Customers of software group SAP are reportedly facing intensifying pressure to increase IT spending to go digital, despite severe declines in revenue and earnings.
A poll of SAP’s German users found nearly three-quarters experienced sharp drops in revenue, while four-fifths said the COVID-19 pandemic has made digital transformation a pressing task.
“At the center of this crisis is the need for businesses to do more with less,” said Marco Lenck, the Chairman of the German-speaking DSAG user group who commissioned the poll.
DSAG, a representative of 3,700 businesses, has called on SAP to make it easier to upgrade systems that are traditionally hosted on-site to be run in remote data centers or cloud-based infrastructures.
SAP’s new CEO, Christian Klein, welcomed the DSAG survey’s findings. He said the results were representative of how the group’s global business was performing.
Mr. Klein said he had taken into account calls to improve integration between its four main processes: sales, procurement, human resources and supply chain management.
Work on creating a common data model, user interface and consistent security and identity management in these four areas is now 57% complete. By the end of the year, 90% of the job will be done, Mr. Klein said.
“We expect the transformation in the IT and technology sectors to gather pace and that demand will rise. We are of course offering targeted support to those customers in economic difficulty – we want long-term client relationships,” added Mr. Klein.
SAP has offered flexible payment terms to clients facing cost pressures, like those in the airlines sector, to help them ride out the economic downturn caused by the pandemic.
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