Horváth: 90% of companies have started SAP S4/HANA transformation, but 60% are exceeding the initial budget and deadline

• 30% of companies have completed or are close to completing their SAP S/4HANA implementation, and the majority (83%) started their transformation processes after 2019. On average, implementation takes 30% longer than planned.
• 98% of companies use external support for implementation.

Digitalization and automation of business processes are increasingly important for companies around the world, and 90% of the companies surveyed have started transformation processes through SAP S/4HANA, shows a study conducted by Horváth, the global management consulting company, present in Romania since 2005.

However, 60% of the companies that completed the implementation encountered significant deviations from the initial plan, exceeding the budget and deadline, and 65% reported quality issues. In addition to these challenges, 30% of the companies managed to complete the transformation, shows the Horváth study “Business Transformation Unlocked – Maximizing the Benefits of SAP S/4HANA”, conducted between December 2024 and January 2025.

Among the digital transformation objectives through SAP, assumed by companies, in first place (36%) is the optimization of business processes and/or the introduction of new functions. This is followed by:

• creating a basis for further digitalization and, in particular, for the implementation of artificial intelligence applications;
• standardizing/harmonizing business processes; and
• adapting the business model to the future – each with 31%.

Other objectives are:

• promoting automation across the company (30%); and
• centralizing tasks and processes (29%).

The majority of companies (83%), whose executives participated in the Horváth study, started their transformation processes after 2019, and one of the biggest obstacles to implementation was project management. On average, companies needed 30% more time than they had initially estimated to complete the transformation, with the average project duration increasing from 15 months to 20 months.

In addition, 32% of companies reported major delays and 24% exceeded planned budgets. The main causes of these deviations include unforeseen expansion of the project scope (32%), weaknesses in project management (27%), and additional time required for testing and migration (24%).

Another key aspect identified in the study is the need for external support: 98% of companies collaborate with consultants to implement SAP S/4HANA. Of these, 61% work with IT consulting firms, and 46% use strategic and process consulting. However, only 21% of companies integrate consulting for change management, which can contribute to difficulties in adopting new systems and processes.

Over 75% of companies prefer external cloud solutions to host SAP S/4HANA, while only 20% still use on-premise solutions, and 5% are undecided. Thus, almost half of the companies opt for private cloud solutions and a third opt for public cloud solutions. Companies that have completed the SAP S/4HANA transformation say that if they were to repeat the process, they would allocate a larger budget, a longer implementation period and reduce the complexity of the project.

The main improvements they would make are extending the project duration (46%), increasing the allocated budget (41%) and reducing the project scope (30%).

“Digital transformation through SAP S/4HANA is an essential step for companies that want to remain competitive, but the success of this process depends on careful planning, allocation of sufficient resources and correct prioritization of objectives. Companies must understand that although the benefits are considerable, the challenges can be just as great. Therefore, the involvement of IT departments and specialized consultants becomes a necessity, not just an option,” said Costin Lăpădat, Senior Project Manager, Horváth Romania.

The study was conducted through interviews with 200 executives from companies using SAP, with more than 200 employees and generating revenues of more than 200 million euros per year. The companies analyzed came from manufacturing (51%), services (38%) and other (11%) industries, 50% of which were located in Germany, and 10% each in Austria, Denmark, Switzerland, Romania and the USA. SAP S/4HANA is the latest version of the ERP (Enterprise Resource Planning) solution suite from SAP, the largest global provider of ERP software, designed to help organizations digitize and automate their business processes.

Unlike previous versions, S/4HANA uses in-memory computing technology to improve the speed and efficiency of operations, allowing companies to analyze and process data in real time. Implementing this system is a critical step for companies that want to remain competitive in an increasingly digital business environment.