According to the 2022 ISG Provider Lens SAP Ecosystem study for France, many businesses in the country are relying on SAP cloud service providers for the knowledge and tools necessary to modernize their SAP deployments and maintain their SAP applications.
The ISG Provider Lens Quadrant research series is a thorough assessment of service providers that incorporates factual, data-driven research, and market analysis with the first-hand experience and insights of the firm’s worldwide advisory group. ISG advisors utilize the reports to validate their own industry expertise and provide suggestions to its enterprise customers, while the analyses themselves are used by organizations to support the selection of relevant sourcing partners.
Today, the study involves service providers operating in Europe, the United States, Canada, Brazil, the United Kingdom, France, Benelux, Germany, Switzerland, the Nordics, Australia, Singapore, and Malaysia. The ISG report for Brazil released last month indicated that the majority of businesses in the country are still operating their SAP enterprise resource planning (ERP) applications on-premises or with third-party data centers. However, as cloud technologies become the standard, more and more enterprises are starting to migrate their core systems to the cloud.
In France, the demand for SAP services is booming as a rising number of companies are moving their operations to SAP S/4HANA — the German tech giant’s ERP business suite based on the SAP HANA in-memory database — and the cloud, in order to achieve greater levels of agility and resilience. According to ISG’s study, major migrations have been initiated by large corporations as a consequence of the increasing complexities of SAP systems and the requirement for cloud hosting. But it is also worth noting that medium-sized companies continue to be more cautious.
Furthermore, the study also stated that the global pandemic caused by COVID-19 increased the level of interest in cloud services in France. This is because many businesses found it difficult to secure the availability and security of their information systems when the crisis was at its peak. Applications developed by SAP, which are often essential to a company’s core business operations, were among the first to be moved to a cloud-based environment.
Sharing his insights on the report, Lyonel Roüast, Partner and President at ISG SEMEA, said:
“In-house management of SAP applications is becoming a thing of the past in France. Many companies still retain their traditional ERP, but the move toward managed services contracts has strong momentum.”
Recognizing the Capabilities of SAP Cloud Service Providers
ISG also noted that many French businesses’ IT departments have been strained to breaking point by the increasing complexities of SAP solutions. SAP S/4HANA, SAP Business Technology Platform (SAP BTP), and the Business Transformation as a Service signature cloud offering RISE with SAP are all gaining popularity as a result of this movement. Having said that, the role of service providers in the deployment of such solutions is also growing.
Moreover, the study also found that companies in France’s middle market take a unique approach to SAP modernization and service provider selection compared to their global counterparts. Most mid-sized businesses are still using SAP’s older ECC6 ERP software, which the company will no longer support beyond 2027.
Commenting on this topic, Jan Erik Aase, Partner and Global leader at ISG Provider Lens Research, remarked:
“Enterprises in France are finally recognizing the capabilities of cloud service providers. Most still favor private clouds, but hybrid clouds are gaining acceptance.”
However, some medium companies said that they are apprehensive about transitioning to the cloud and haven’t started using it yet. Because of factors like proximity, ease of engagement, and the absence of a language barrier, local providers enjoy a considerable advantage in the French middle market.
Several other French SAP ecosystem developments are examined in ISG’s research as well, such as the growing significance of customization tools, the talent shortage that many service providers are experiencing, and the contrast between the capabilities of global and local SAP cloud service providers. Based on criteria including SAP S/4HANA System Transformation, Managed Application Services for SAP ERP, Managed Platform and Cloud Services for SAP, and SAP BTP, the ISG Provider Lens SAP Ecosystem study for France in 2022 has ranked the 29 participating providers.
Accenture, Atos, and Capgemini were all deemed to be Leaders across all four categories. Meanwhile, leaders in two of the four quadrants are DXC Technology and TCS, while IBM, oXya, and T-Systems are each recognized as a Leader in just one of the four.
