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SAP modernization generates business for services providers willing to deal with a high degree of complexity: Customers' on-premises systems include everything from mainframes to aging client-server systems. The goal is to run SAP's enterprise software in the modern cloud.
Making that happen isn't easy. For one, customers can have a range of motivations, migration methods and modernization objectives. Their software may require refactoring to run effectively in the cloud. Additionally, customers can have high-performance expectations for partners. Organizations have spent decades building heavily customized environments to get the most out of their SAP deployments, and partners must measure up to that benchmark.
Nevertheless, IT services companies have decided to gear up for modernization projects amid SAP's push for S/4HANA adoption. Several systems integrators, for example, recently bolstered their skillets by buying SAP specialists, hoping to land customers willing to transition their SAP workloads to the cloud.
Out with the old
Legacy hardware, costly to run and ripe for retirement, often provides an impetus for SAP modernization projects. Those older systems include IBM mainframes, mid-range products such as AS/400s and an array of x86 products.
Vince Lubsey, CTO at Lemongrass, an Atlanta-based MSP that specializes in migrating SAP systems to AWS, said most of the company's SAP modernization clients use x86 platforms. Some customers, however, use AIX-based IBM z13 mainframes running against a DB2 database.
Mainframe customers, which usually run SAP R/3 applications, can follow the general migration methodology their x86 counterparts follow, Lubsey said. But customer-specific mainframe integrations and customizations require special consideration, he added.
Maintaining older and idiosyncratic systems typically stretches the IT budget, which makes cost reduction the initial driver for many cloud migrations.
"They are typically looking into the cloud to save money," Lubsey said. A cloud migration can pay off for customers running SAP on very expensive proprietary gear, such as non-commodity or non-x86 machines, he added.
The COVID-19 pandemic also influences customers' cloud migration decisions. "There has been a general trend to use the cloud as a result of the pandemic," Lubsey said, noting some companies have struggled to remotely operate conventional data centers.
Hans Georg Uebe, global head of ecosystem delivery success at SAP, also noted the pandemic's role in accelerated cloud adoption. "Companies more and more realize the importance of having IT decentralized, providing the … flexibility to access the IT from everywhere."
That said, the cloud migration trend can vary significantly from customer to customer, according to Alex Heublein, president of GT Software, a digital transformation and mainframe migration company based in Atlanta.
"One thing many [customers] have in common is that the pandemic caused a reevaluation of many priorities, and mainframe-to-cloud migrations was one of them," Heublein said. "Some organizations that had plans to migrate put everything on hold, while others that were not planning to immediately migrate took another look at the costs they were incurring and accelerated their migration plans."
SAP modernization services in demand
Enterprises that greenlight cloud migration tap service providers for a range of needs.
Customers initially ask for strategic consulting on how to proceed, Heublein said.
"Mainframe systems are inherently complex, with many interconnected parts and pieces that are not easily extricable from one another," he said. "So many organizations need help coming up with a migration roadmap and evolutionary strategy that looks at the entire environment holistically."
Consulting services may require analysis tools that help determine just how intertwined customers' mainframe components have become. The tools also sort out which components can be easily migrated without affecting other parts that will remain in place for some time, Heublein noted.
Alex HeubleinPresident, GT Software
"It's a very complex situation, so figuring out what to migrate, when to migrate it and in what order is not a trivial task," he said.
Clients also tap partners to place an abstraction layer between their modern applications and the mainframe, Heublein explained. This approach shields the newer applications from the inherent complexity of most mainframe environments.
"We find this is a key success factor in mainframe-to-cloud migrations because [customers] are, as the old saying goes, trying to sail the boat while they're fixing it," Heublein said.
Lubsey, meanwhile, outlined a multiphase process for SAP cloud migrations:
- The discovery phase starts the process, evaluating the customer's as-is environment to understand what the business has in place. This step also assesses the performance of the existing, on-premises SAP system.
- The design phase envisions the customer's to-be setting.
- A series of financial planning steps follows to clearly understand financial outcomes.
- In the realization phase, a customer's legacy systems are migrated and onboarded to the cloud.
- The validation and transition phase uses system response time information collected during the discovery phase to ensure the cloud environment offers comparable or better performance.
- A steady-state operations phase comes next, leading to …
- A continuous improvement phase that aims to optimize the cloud environment.
Customers' paths may diverge at the migration step of an SAP modernization project. Lubsey identified the two main branches: a lift-and-shift migration and a lift-and-modernize approach.
Organizations use the first strategy when their main priority is to get quickly to the cloud and the expected cost savings. But a head-to-head cost comparison doesn't always favor the cloud and, in any event, may not prove the decisive advantage of migrating in the long run. Lubsey said businesses should consider their "access to the newer and innovative services" in the cloud.
Vince LubseyCTO, Lemongrass
For that reason, Lubsey said he recommends the migrate-and-modernize method as providing the most value over time. Customers can take advantage of ongoing cloud advancements, while also moving toward an agile operating model that responds quickly to business changes.
"Why not focus on agility and innovation, and take advantage of all the capabilities of the cloud?" Lubsey said.
SAP's Uebe also cited growing interest in cloud benefits other than cost reduction. Three or four years ago, customer conversations often focused on total cost of ownership, but those discussions have now shifted to how companies can use the cloud for innovation, he said. Businesses gearing up for anticipated post-COVID-19 growth are looking to digitize products, sell new services and enter new markets, he noted.
"This is where companies really look for cloud offerings that help them, on the IT side, to support their new business initiatives," Uebe said. SAP has established "move programs" to enable partners to support migrations of legacy environments to the cloud, he added. Partners, for example, are poised to participate in the Rise with SAP program, which aims to entice customers to adopt S/4HANA.
Customers move to the cloud for various reasons, and their methods can prove similarly diverse. Indeed, many organizations combine more than one migration method, Heublein noted.
"There are many different approaches, from code refactoring to lift-and-shift solutions to simply replacing the mainframe functionality with commercial off-the-shelf applications," he said. "We find that it's rarely just one approach. Most organizations end up with a mix of two or three of those approaches because every application has different characteristics."
Heublein, citing the complexities of mainframe-to-cloud migration, said no "magic bullet" exists for getting the job done. Some technologies, however, such as Heirloom Computing's mainframe replatforming offering, can quickly refactor existing applications into cloud-native code, he said. In addition, services providers, including Advanced (formerly Modern Systems), provide skill sets and project management methodologies for large-scale migrations, he added.
Customization and change management
Customers with heavily customized mainframe systems present partners with another modernization hurdle.
"Customized environments can be very challenging because many of them were built decades ago and designed to extract extremely high-volume performance from a very specific set of hardware and software [platforms]," Heublein explained. "It's hard to take a very old design and make it perform in a completely new environment without at least some degree of re-architecture and refactoring."
The extent of modification required depends on the specific application and its effect on capacity planning. Certain applications, Heublein said, are much more conducive to horizontal scaling -- the addition of cloud instances and load balancing to achieve better performance. From a performance perspective, applications that can be horizontally scaled move to the cloud more easily.
Other applications lean toward vertical scaling, which involves adding capacity to a cloud instance for better performance. Heublein said many legacy applications were written to run on a "very large, scale-up machine" such as a mainframe. Those applications weren't designed and optimized to operate in a distributed, load-balanced environment, which typically rules out horizontal scaling. Vertical scaling, however, can prove difficult.
"You can generally only make cloud VMs so big and it's generally not particularly cost-effective to make them really big," Heublein said. "So, that can make it more difficult to migrate some -- but not all -- of those applications without some level of re-architecture and refactoring."
SAP modernization, however, isn't strictly a technical endeavor. "There is an organizational change management aspect to it, as well," Lubsey said.
For example, customers may need to reskill or upskill their personnel to effectively manage and maintain systems in a cloud environment. Lemongrass educates customers on the difference between on-premises and cloud-based management, while also advising them on new roles and activities they should adopt to run the cloud, Lubsey noted.
One difference: The cycle to provision and procure on-premises infrastructure involves a long lead time, which isn't the case with the cloud.
"The infrastructure is digitized, so the time to provision is minutes, rather than weeks," Lubsey said of cloud computing. "The implication of this is that uncontrolled provisioning can lead to unexpected costs, so guiderails and education about these implications needs to be understood."