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Survey results are based on 179 responses collected from SAP customers and system integrators through a standardized online questionnaire during April of 2009. 1 Some of survey’s key findings include:
• The average cost of SAP development and support across the surveyed organizations is $5,670 per user per year. 2
• On average, 70% of the cost goes towards in-house resources and 30% towards outsourcing.
• Overall cost is the top support-related challenge, as cited by 70% of the respondents.
• The effort involved in implementing Support Packages is quite considerable, reaching an average of 73 person days per support package, with the majority of the effort associated with testing (42 days).
• When asked about their reaction to the recent changes in SAP’s Enterprise Support policy, the majority of the respondents (68%) do not think the price increase is reasonable. At the same time, a surprising 32% is either supportive of the price increase or neutral to it.
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1 The survey can be accessed online at http://www.surveygizmo.com/s/117894/benchmark-sap-support-costs. 2 Cost per User = (Total Internal Cost + Outsourcing Cost) / Number of SAP Users
Eighty percent of the survey respondents represent SAP customers that run their own business on the SAP system. The remaining twenty come from SAP-partner organizations that help other companies with their upgrade projects.
Consultant/SI
20%
Customer
80%
Figure 1: Respondents’ Relationships with SAP
The survey was completed by respondents from all over the world, with the majority coming from Europe and The Americas, followed by Asia & The Pacific and Africa & The Middle East.
Customer organizations responding to the survey come from a variety of industries, with a particularly strong representation of the manufacturing sector.
2%
3%
4%
4%
5%
6%
6%
8%
11%
11%
13%
25%
Healthcare
Professional Services
Aerospace & Defense
Communications
Retail
Financial Services
Construction
Public Sector & Education
Utilities
High Tech
Other
Manufacturing
Figure 3: Responding Customers by Industry
Responding customers represent a fairly even distribution of company size (measured by revenues), ranging from smaller companies with annual revenues of less than $0.5 billion US dollars to larger ones with revenues of over 5 billion dollars.
27%
20%
14%
21%
18%
0%
5%
10%
15%
20%
25%
30%
<$0.5B $0.5B-1B $1B-2B $2B-5B >$5B
Company Size (2008 Revenues in $US)
Figure 4: Responding Customers by Company Size (2008 in $US)
The vast majority of the respondents (64%) are currently using ERP 2005.
6%
16%
9%
64%
4%
0%
10%
20%
30%
40%
50%
60%
70%
4.6C 4.7 ERP2004 ERP2005 Other
Figure 7: Current Version
The modules most commonly used by survey respondents are FI (98%), CO (95%), and MM (89%). The least used modules are LE (33%), QM (51%), PS (53%), and PM (54%).
The vast majority (81%) of the respondents use SAP® NetWeaver Components. Among those that use the SAP NetWeaver Components, BW/BI is the most commonly used (83%).
Using
Components
81%
No
19%
35%
19%
43%
47%
83%
Others
TREX
SAP EP
SAP XI/PI
SAP
BW/BI
Figure 9: Components Used
Over 41% of the respondents are using SAP industry solutions.
Overall cost is the clear top challenge cited by a large majority of the respondents (70%) when asked about their support-related challenges. Next in line are response to service requests (46%) and level of enhancement/new functionality (42%).
7%
12%
15%
15%
42%
46%
70%
Other
Downtime
System response time
Stability of system
Level of enhancement/new functionality
Response to service requests
Overall IT costs
Figure 11: Support Challenges (Top Two Selected)
Part of the ongoing challenge faced by most support organizations is the deployment of SAP Support Packages, which are deployed by 83% of the respondents. Almost half of the respondents (43%) deploy Support Packages as part of a Support Package stack, while 25% select only the required packages.
The vast majority (82%) of those that deploy Support Packages apply more than one package per year. More than half of these organizations (54%) deploy 2-4 support packages per year and over a quarter of the organizations (28%) deploy 5 or more packages yearly.
8%
20%
54%
18%
0%
10%
20%
30%
40%
50%
60%
One Two to Four Five to Ten Over Ten
Figure 13: Support Packages per Year
The effort involved in implementing Support Packages is quite considerable, reaching an average of 73 person days per support package, with the majority of the effort associated with testing (42 days).
Preparations
18
Installation
14
Testing
42
0 10 20 30 40 50 60 70 80
Figure 14: Average Support Package Implementation Effort (in person days)
Given these figures, it is not surprising that the primary challenge associated with Support Packages is assessing the impact on the existing solution, cited by 58% of the respondents, followed by efficient testing (39% of the respondents) and minimizing downtime (24%).
Top 3 Support Package Challenges 1. Assessing the
impact on the
existing solution 2. Efficient testing
3. Minimizing
downtime
5%
10%
15%
18%
20%
24%
39%
58%
4%Other
End-user training
Project Management
Justify budget for project/value proposition
Modification adjustment
Cost/effort estimation
Minimize downtime
Efficient testing
Assess impact on existing solution
Figure 15: Support Package Challenges
SAP Enhancement Packages are deployed by 80% of the organizations that are currently on ECC 6.0. Of the organizations that implement Enhancement Packages, almost half (49%) plan to implement 2-4 packages in the next year and 15% plan to implement 5 or more packages.
Plan on Enahncement Packages?
Yes
80%
No
20%
36%
49%
7%8%
0%
10%
20%
30%
40%
50%
60%
One Two to Four Five to Ten Over Ten
Figure 16: Enhancement Packages Planned in the Next Year
The challenges associated with Enhancement Packages are somewhat similar to those associated with Support Packages, with the added challenge of understanding the new functionality included in the enhancement package, which was cited as one of the two top challenges by over half (51%) of the respondents. Assessing the impact on the existing solution was a close second (47%), followed by understanding how to implement the new functionality (24%).
Top 3 Enhancement Package Challenges 1. Undestanding the
new functionality 2. Assessing the
impact on the existing solution
3. Understanding
how to implement
3%
6%
9%
14%
16%
18%
24%
51%
47%
3%Modification adjustment
End-user training
Project Management
Minimize downtime
Cost/effort estimation
Justify budget for project/value proposition
Efficient testing
Understand how to implement the new functionality in our system
Assess impact on existing solution
Understand the new functionality
Figure 17: Enhancement Package Challenges
Another type of system maintenance task that is practiced by most organizations on an ongoing basis is the release of transports. Most organizations (59%) release transports as often as needed, without a pre-determined release schedule. Another 24% of the organizations release transports at least once a week, while only 18% release them monthly or quarterly.
that comes with the new SAP® Enterprise Support offer is reasonable.
As of January 2009, SAP launched SAP® Enterprise Support, which offers a broader scope of services at an increased price. 3 While the majority of the respondents (68%) do not think the price increase is reasonable, a surprising 32% is either supportive of the price increase or neutral to it.
the value of the new SAP® Enterprise Support offer.
Respondents showed a slightly more positive attitude when asked about the value they see in the new enterprise support offer. Still, close to half of the respondents (49%) either disagree or strongly disagree when asked if they appreciate the value of the offer.
The average cost of SAP development and support is $5,670 per user per year.
SAP customers allocate a considerable amount of resources to the ongoing support of their applications. The average cost of SAP development and support across the surveyed organizations is $5,670 per user per year (the cost of internal and outsourced resources divided by the number of SAP users). Costs are higher in Europe and the Americas compared to the rest of the world.
$6,789
$5,537
$3,957
$-
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
Europe Americas ROW
Figure 22: Average Annual Support Costs per User
Almost all the organizations surveyed outsource some of their SAP development and support work. On average, 30% of the spending is used for outsourcing.
Figure 1: Respondents’ Relationships with SAP ............................................... 4 Figure 2: Respondents by Region .................................................................. 4 Figure 3: Responding Customers by Industry .................................................. 5 Figure 4: Responding Customers by Company Size (2008 in $US) ..................... 5 Figure 5: Number of SAP Production Systems (Customer Organizations) ............ 6 Figure 6: Number of SAP Production Users (Customer Organizations) ................ 6 Figure 7: Current Version ............................................................................. 7 Figure 8: Modules Used ................................................................................ 7 Figure 9: Components Used .......................................................................... 8 Figure 10: Use of Industry Solutions .............................................................. 8 Figure 11: Support Challenges (Top Two Selected) ......................................... 9 Figure 12: SAP Corrections Implementation Policy ........................................... 9 Figure 13: Support Packages per Year ......................................................... 10 Figure 14: Average Support Package Implementation Effort (in person days) ... 10 Figure 15: Support Package Challenges ....................................................... 11 Figure 16: Enhancement Packages Planned in the Next Year .......................... 11 Figure 17: Enhancement Package Challenges ............................................... 12 Figure 18: Transport Release Policy ............................................................. 12 Figure 19: Is the Price Increase Reasonable? ................................................ 13 Figure 20: Appreciate the Value of the New Enterprise Support Offer .............. 13 Figure 21: Little or No Impact from the New Enterprise Support Offer ............. 14 Figure 22: Average Annual Support Costs per User ........................................ 15 Figure 23: Outsourcing vs. In-house Costs ................................................... 15 Figure 24: Distribution of In-House Resources .............................................. 16