SAP Upgrade Survey 2012

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2012 SAP Upgrade Survey

|Page2Panaya Inc, 201www.panayainc.com

Panaya Inc.

SAP Upgrade Benchmark

January 2012

Survey Results and Executive Summary

For questions and additional information

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Table of ContentsSummary ............................................................................................................................................... 3

Respondent Demographics ..................................................................................................................... 5

SAP System Sizing ................................................................................................................................. 7

SAP System Characteristics ..................................................................................................................... 8

Upgrade Plans ..................................................................................................................................... 11

Outsourcing and Use of Partners ........................................................................................................... 13

Upgrade Challenges ............................................................................................................................. 14

Upgrade Duration, Effort, Budget .......................................................................................................... 15
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SummaryUpgrades can be major undertakings for companies that rely on enterprise software to run their business.Not only is the upgrade project intensive on resources (over 3,800 person days and five millions dollars fora large organization), it is also a source of risk. Any system errors introduced during the upgrade progress

could be severely disruptive to the companys operations.

In its third year now, this benchmark survey was conducted by Panaya to help companies that are planningan SAP upgrade validate their planning assumptions and compare them to those of other organizations.

Survey results are based on 128 responses collected from SAP customers and system integrators worldwidethrough a standardized online questionnaire during December 2011.

Some of the key findings from this years survey include:

The pace of upgrade activity has remained consistently high throughout the years. Overall, 96%of the companies that run version 5.0 or earlier versions are either currently upgradingtheir systems or have plans for a future upgrade. The majority of these companies (57%)have either already started their upgrade or will start the project in the next 6 months.

Similarly to the 2009 results, Extended Maintenance is the clear top reason for upgrade (67%),followed by Functional Requirements (29%). There is a significant increase in the number ofrespondents citing legal compliance as a primary reason for upgrade (18% in 2011 vs. 9% in2009).

Three of the top four challenges mentioned by survey respondents relate to the planning phases ofthe upgrade, including cost/effortestimation (39%),justifying a budget (31%), andassessing the impact on the existing solution (29%). Minimizing downtime (29%) is alsoa top challenge.

Upgrade duration, effort, and cost are highly correlated to the number of production users. Whilethe median effort for organizations with 500 or fewer users is 150 person days over 12 weeks at acost of $125,000, the median effort for organizations with over 2,500 users is 3,350 daysover 31 weeks at a cost of over 1.4 million US dollars.


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About Panaya

Panayas software-as-a-service helps companies that use SAP or Oracle reduce 80% of their upgrade andtesting risk and effort. Utilizing a cloud-based supercomputer, Panaya simulates the upcoming upgrade,

automatically pinpointing which custom programs will break as a result of the upgrade and automaticallyfixing most of these problems.

Panayas testing solutions dramatically expedite ERP testing and eliminate the need for manual test scriptmaintenance. Seamlessly capturing business knowledge in the background, as users work with the ERPapplications, Panaya automatically generates plain-English test scripts that are rapidly executed andcontinually self-adjust based on test results.

To learn more, or apply for a free upgrade evaluation click here:http://www.panayainc.com/Request-a-Trial.html
http://www.panayainc.com/http://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/


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Respondent Demographics

More than half (55%) of the survey respondents come from companies that are SAP customers and runtheir own business on the SAP system, while 36% represent SAP-partner organizations that help othercompanies with their upgrade projects.

Figure 1: Respondent Relationship to SAP

Survey respondents represent all regions of the world. Almost a third (31%) are fromAsia Pacific. Asimilar portion of the respondents (30%) is located in Europe, while North America and the Rest of theWorld are represented by 18% and 21% of the respondents respectively.

Figure 2: Respondents by Region


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The responding customerorganizations are fairly evenly distributed among large and small companies.46% of the responding customers are from companies with revenues of less than one billion US dollars,while the remaining 54% represent companies with revenues of over one billion dollar.

Figure 3: Responding Customers by Company Size


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SAP System Sizing

Close to two thirds of the responding customer organizations (63%) operate more than one SAPproduction system. While most of these organizations (43% of the total) operate 2-5 systems, someorganizations operate over twenty systems.

Figure 4: Number of SAP Production Systems (Customer Organizations)

More than half of the responding organizations (58%) have over 500 production users, with 26%reporting over 2,500 users and the largest organization with 55,000 users.

Figure 5: Number of SAP Production Users (Customer Organizations)


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SAP System Characteristics

ERP 6.0 is used by two thirds of the survey respondents (67%), followed by R/3 4.7 with 21% andversions 4.6 and 5.0 with 11% each (some organizations use more than one version).

Figure 6: Current Version

The modules most commonly used by survey respondents are FI (96%), MM (89%), CO (87%), and SD(84%). Least used modules are PS (49%), QM (45%), and LE (31%).

Figure 7: Modules Used


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The vast majority (88%) of responding organizations use SAP NetWeaver Components ,compared to 73% in 2009. Among those that use the SAP NetWeaver Components, BW/BIis the mostcommonly used (76%), followed by EP (50%) and XI/PI (47%).

Figure 8: NetWeaver Components Used

Over half of the responding organizations (55%) use industry solutions, continuing a trend ofgrowing adoption over the past three years.

Figure 9: Use of Industry Solutions


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Almost all organizations surveyed (95%) have at least one interface from the SAP system to anothersystem. 55% of the organizations have more than ten interfaces, 23% are using over fifty interfaces, and9% have over 100 different interfaces.

Figure 10: Number of Interfaces to Other Systems


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Upgrade PlansOverall, 96% of the companies that run version 5.0 or earlier versions are either currently upgradingtheir systems or have plans for a future upgrade. Similarly to the results in 2009, the majority ofthese companies (57%) have either already started their upgrade or will start the project in the next 6months.

Figure 11: Upgrade Date

Similarly to the 2009 results, Extended Maintenance is the top reason for upgrade (67%), followed byFunctional Requirements (29%). There is a significant increase in the number of respondents citinglegal compliance as a primary reason for upgrade (18% in 2011 vs. 9% in 2009).

Figure 12: Reasons for Upgrade (Top Two Selected)


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While extended maintenance is the primary driver for upgrade, the majority of organizations (65%)do plan on functional or strategic enhancement as part of the upgrade project . However, most ofthese organizations (41% of total respondents) start out with aTechnical Upgrade, followed bysubsequent implementation of additional functional or strategic enhancements.

Figure 13: Upgrade Type

Unicode conversion, highly recommended by SAP, is an important goal for many organizations. Close totwo thirds of the organizations that are currently upgrading or planning an upgrade (63%) areincluding Unicode conversion as part of their upgrade project.

Figure 14: Unicode Conversion Included in Upgrade


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Outsourcing and Use of Partners

A majority of the organizations surveyed outsource at least part of the upgrade project workto third-party partners. Only 20% of the organizations are not using any partner help, while 45% of theorganizations outsource at least half of the project work.

Figure 15: Uses of Outsourcing

Many organizations use more than one partner. The most frequently cited partners are TCS (19%), SAP(17%), and Satyam (15%).

Figure 16: Most Mentioned Partners


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Upgrade ChallengesThree of the top four challenges mentioned by survey respondents relate to the planning phases of theupgrade, including cost/effortestimation (39%),justifying a budget (31%), and assessing theimpact on the existing solution (29%). Minimizing downtime (29%) is also a top challenge.

Figure 17: Upgrade Challenges (Top Two Selected)


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Upgrade Duration, Effort, BudgetTotal upgrade project duration is highly correlated to the number of production users , rangingfrom an average of 12 weeks for organizations with 500 or fewer users to over one year (53 weeks) fororganizations with over 2,500 users.

Figure 18: Average Project Duration by Number of Production Users

On average, the most time-consuming stage in the project is Realization (35% of total projectduration), followed by Preparation (19%) and Blueprint (18%).

Figure 19: Average Duration for Each Stage


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Not surprisingly, upgrade effort and budget are also highly correlated with the number of production users.The median effort for organizations with up to 500 users is 150 person days, reaching a median of3,350person days for organizations with more than 2,500 users.

Figure 20: Average Upgrade Effort by Number of Users

The median upgrade project budget for organizations with up to 500 users is $125,000, climbing up toover $1.4 million dollars for organizations with more than 2,500 users.

Figure 21: Average Upgrade Effort by Number of Users


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Table of FiguresFigure 1: Respondent Relationship to SAP ............................................................................................... 5

Figure 2: Respondents by Region ............................................................................................................ 5

Figure 3: Responding Customers by Company Size .................................................................................. 6

Figure 4: Number of SAP Production Systems (Customer Organizations) ................................................... 7

Figure 5: Number of SAP Production Users (Customer Organizations) ....................................................... 7

Figure 6: Current Version ....................................................................................................................... 8

Figure 7: Modules Used .......................................................................................................................... 8

Figure 8: NetWeaver Components Used .................................................................................................. 9

Figure 9: Use of Industry Solutions ......................................................................................................... 9

Figure 10: Number of Interfaces to Other Systems................................................................................. 10

Figure 11: Upgrade Date ...................................................................................................................... 11

Figure 12: Reasons for Upgrade (Top Two Selected) .............................................................................. 11

Figure 13: Upgrade Type ...................................................................................................................... 12

Figure 14: Unicode Conversion Included in Upgrade ............................................................................... 12

Figure 15: Uses of Outsourcing ............................................................................................................. 13

Figure 16: Most Mentioned Partners ...................................................................................................... 13

Figure 17: Upgrade Challenges (Top Two Selected) ............................................................................... 14

Figure 18: Average Project Duration by Number of Production Users....................................................... 15

Figure 19: Average Duration for Each Stage .......................................................................................... 15

Figure 20: Average Upgrade Effort by Number of Users.......................................................................... 16

Figure 21: Average Upgrade Effort by Number of Users.......................................................................... 16


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Disclaimer and Trademark NoticesThis report is provided by Panaya Inc. It is completely independent of and not affiliated with Oracle or SAP

AG. Oracle is a registered trademark of Oracle. Oracle and other Oracle products and services mentionedherein as well as their respective logos are trademarks or registered trademarks of Oracle. SAP is aregistered trademark of SAP AG. SAP and other SAP products and services mentioned herein as well astheir respective logos are trademarks or registered trademarks of SAP AG in Germany and in several othercountries. All other product and service names mentioned are the trademarks of their respectivecompanies.

Survey results are based on responses provided by anonymous participants and have not been verified byPanaya. The results are based a limited number of responses and are not warrantied to accuratelyrepresent any data beyond the scope of the individuals that responded to the survey.

DISCLAIMER OF WARRANTYPanaya Inc. makes no representation or warranties, either express or implied by or with respect to anythingin this document, and shall not be liable for any implied warranties of merchantability or fitness for aparticular purpose or for any indirect special or consequential damages .

COPYRIGHT NOTICENo part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form orby any means, photocopying, recording or otherwise, without prior written consent of Panaya Inc. Nopatent liability is assumed with respect to the use of the information contained herein. While everyprecaution has been taken in the preparation of this publication, Panaya Inc. assumes no responsibility forerrors or omissions. This publication is subject to change without notice.

Copyright Panaya Inc. All rights reserved.

About Panaya

Panayas software-as-a-service helps companies that use SAP or Oracle reduce 80% of their upgrade andtesting risk and effort. Utilizing a cloud-based supercomputer, Panaya simulates the upcoming upgrade,automatically pinpointing which custom programs will break as a result of the upgrade and automaticallyfixing most of these problems.

Panayas testing solutions dramatically expedite ERP testing and eliminate the need for manual test scriptmaintenance. Seamlessly capturing business knowledge in the background, as users work with the ERPapplications, Panaya automatically generates plain-English test scripts that are rapidly executed andcontinually self-adjust based on test results.

To learn more, or apply for a free upgrade evaluation click here:http://www.panayainc.com/Request-a-Trial.html
http://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.htmlhttp://www.panayainc.com/Request-a-Trial.html

SAP Upgrade Survey 2012

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SAP Upgrade Survey 2012