DSAG Investment Report 2024: SAP S/4HANA, SAP BTP and AI in focus

When it comes to their IT and SAP budgets, almost half of companies in the DACH region are planning to spend more than last year. This is the conclusion of the DSAG Investment Report 2024, which is based on a member survey conducted by the German-speaking SAP user group (DSAG).

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Higher spending on IT and SAP

43% of companies state that their investments in IT will increase this year. Compared to the previous year, this represents a decrease of 11%. A total of 36% of companies plan to maintain the same level of investment (2023: 26%), while 18% want to reduce their IT expenditure (2023: 15%). According to the survey, 46% of companies are increasing their budgets for SAP solutions. Here, too, the share was higher last year at 52%. The differences between stagnating and decreasing SAP budgets are smaller at 32% (2023: 31%) and 19% (2023: 15%) respectively.

“Market conditions are difficult and uncertain. It is therefore understandable that companies are taking a wait-and-see approach – but this is not recommended if they want to remain competitive in the long term,” says DSAG Chairman Jens Hungershausen.

End of SAP ECC makes investments necessary

With the end of maintenance for SAP ECC approaching in 2027, it is not surprising that the willingness to invest in SAP S/4HANA in particular is bucking the general trend. 38% of companies consider high investments in SAP S/4HANA to be relevant. This is 10% more than in the previous year. One explanation for this is certainly the market penetration of the latest SAP ERP generation, which is still below expectations.

When asked which SAP ERP solution they use, 68% of companies responded with SAP ECC. SAP S/4HANA on-premise is in second place with 44%, followed by SAP S/4HANA Private Cloud (11%). The use of SAP S/4HANA Public Cloud has doubled within a year, and the cloud ERP is now used by 6% of DSAG members. “The cloud operating models for SAP S/4HANA continue to play a subordinate role,” states Jens Hungershausen. “(...) Strategic reasons such as investments already made and security concerns for critical IT infrastructures certainly play a role here.”

Holistic changeover with RISE with SAP

With the help of the RISE with SAP transformation offering, companies can take a holistic approach to the move to SAP S/4HANA. 16% are already using the offering or plan to do so in the future. For 61% of respondents, RISE with SAP is not an option. However, it should be noted that the DSAG survey took place before the launch of “RISE with SAP Modernization and Migration”. The initiative aims to make the move to SAP S/4HANA Cloud more lucrative through financial incentives and additional services.

High relevance of SAP BTP for investments

As a scalable cloud platform, SAP Business Technology Platform (BTP) is playing an increasingly important role in companies’ complex system landscapes. As a result, SAP BTP ranks first when it comes to investments in SAP cloud solutions. A third of respondents are planning high to medium investments here. This is followed by SAP SuccessFactors (21%) and SAP CX (12%) as further cloud solutions.

Within SAP BTP, the planned investments are mainly distributed between analytics solutions (34%) and the area of integration (27%). For application development and automation, 17% of companies have planned high to medium investments.

Spending on AI is on the rise

As part of the DSAG Investment Report 2024, the relevance of artificial intelligence (AI) for companies’ IT investments was also surveyed. 28% consider AI to be of high to medium relevance for their IT investments. Two years ago, this figure was only 12%. What is surprising is that 65% rate artificial intelligence as only slightly or not at all relevant.

Jens Hungershausen provides a possible explanation: “The result shows that many companies are still cautious due to the high level of dynamism in the AI sector and the associated development of the market.” When it comes to SAP, the most frequent demands of DSAG members with regard to the use of AI are the provision of practical use cases, easy access to the technology and open integration that does not exclude on-premise customers from the innovations.