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SAP S/4HANA and Cloud Adoption Gain Momentum in UK in Response to Pandemic, Brexit

  • ISG Provider Lens report sees positive outlook for SAP as companies emerge from survival mode and address remote work, new customer channels and changing regulations

Enterprises in the UK have been restarting SAP projects slowed or suspended during the pandemic and modifying their SAP platforms to adapt to Brexit-related changes, according to a new report published today by Information Services Group, a leading global technology research and advisory firm.

“Both SAP S/4HANA transformations and cloud implementations are now gaining speed in the U.K.”

The 2021 ISG Provider Lens™ SAP HANA Ecosystem Services report for the U.K. finds companies in the country had temporarily halted or slowed SAP implementations as they focused on maintaining operations and controlling costs early in the pandemic. But since the second half of 2020, many stalled projects have gained momentum and the outlook for SAP in the region is positive, ISG says.

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“Both SAP S/4HANA transformations and cloud implementations are now gaining speed in the U.K.,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Digital transformations are helping enterprises meet new challenges from the pandemic, and service providers are also adjusting to new realities.”

The sea change in regulations brought on by Brexit has forced many U.K. enterprises to realign their business processes, which in turn requires changes to their SAP systems, the report says. Companies are doing this in conjunction with S/4HANA implementations as they approach SAP’s deadline for the end of support for SAP ERP Central Component (ECC).

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U.K. enterprises also are pursuing cloud-based implementations to enable new channels of business and better customer experiences, ISG says. Service providers are helping companies roll out cloud-based SAP projects so they can quickly pivot to deploying appropriate solutions.

As pandemic restrictions led U.K. companies to shift to remote work and reduce in-person meetings to nearly zero, service providers also have adjusted their work processes, the report says. Providers are rethinking their onshore-offshore talent strategies to focus on both cost optimization and employee safety, and for SAP services, most of the work is being delivered remotely.

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The report finds adoption of SAP Business Technology Platform (BTP) has been slow in the U.K., despite many proofs of concept, partly due to the complexity of robust integration with other applications. For BTP to gain traction, interoperability with other applications needs to be made easier, ISG says.

SAP managed services providers are embracing automation to better serve their clients, the report says. By increasing their use of artificial intelligence and machine learning, providers aim to help companies optimize costs and address the shortage of resources for specific skills.

The 2021 ISG Provider Lens SAP@ HANA Ecosystem Services report for the U.K. evaluates the capabilities of 30 providers across five quadrants: SAP S/4HANA System Transformation – Large Accounts, SAP S/4HANA System Transformation – Midmarket, Managed Application Services for SAP@ ERP, SAP Business Technology Platform (BTP) and Intelligent Technologies, and Managed Cloud Services for SAP HANA.

The report names Accenture, Capgemini, HCL, IBM, TCS and Wipro as Leaders in four quadrants each. It names Atos as a Leader in three quadrants and Infosys and Tech Mahindra as Leaders in two quadrants each. Hexaware, LTI, Mindtree, NTT DATA and T-Systems are named as Leaders in one quadrant each.

In addition, Cognizant is named as a Rising Star—a company with a “promising portfolio” and “high future potential” by ISG’s definition—in two quadrants. Deloitte and NTT DATA are named as Rising Stars in one quadrant each.

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