According to a report from Gartner last week, global IT debt will total approximately $500 billion in 2010, with the potential rise to $1 trillion by 2015 (http://bit.ly/9Ut9Lz). Gartner defined IT debt as the cost of clearing the backlog of maintenance that would be required to bring the corporate applications portfolio to a fully-supported current release state. While you can argue the validity of the overall IT debt figure, it is clear that a lot of organisations are deferring upgrades to their application portfolios in the face of ever-tightening IT budgets.
Research we carried out last year revealed that 54% of SAP users in the UK & Ireland were planning to upgrade their software over the next 12 months. However, of those questioned 70% felt that the cost of upgrading was too high, particularly at a time when organisations are facing reductions in IT budgets. So many organisations still face a difficult balancing act and need to be wary that delaying their upgrade cycle doesn’t bring unexpected long-term costs. For example, older versions may require more maintenance and management and have limited capability compared to newer versions.
Many SAP users will continue to face important decisions over the next 12-18 months as whether to upgrade their software, so guidance is essential. At this year’s annual user conference, we will again be aiming to further help educate SAP users on how to best approach upgrading their SAP software and make best use of the latest functionality. Hopefully by doing this, users will then be able to further realise the performance and cost-reduction benefits.