Navigating ECC to S/4HANA Transition
Introduction – Why Licensing Defines Your Migration Strategy
Migrating from SAP ECC to S/4HANA isn’t just a technical upgrade – it’s a contractual and financial transformation. How you handle licensing will largely determine your project’s cost and flexibility.
SAP’s support deadlines (mainstream support ending in 2027, with limited extensions through 2030–2033) add urgency, but they also create leverage points if you plan wisely.
To avoid overpaying during this transition, enterprises need a structured negotiation playbook.
In other words, success lies not only in how you migrate, but when and under what terms you negotiate your SAP licenses and support. Read our ultimate guide to S/4 Hana Licensing.
ECC Support Timeline
SAP has outlined clear end-of-support dates for ECC (SAP Business Suite 7) that should guide your strategy.
Key milestones include:
- 2027 – End of Mainstream Support: Standard support for ECC core applications runs until December 31, 2027. After this date, no new patches or updates will be available unless you opt for extended measures. This is the first big deadline pressuring customers to move or pay extra for support.
- 2028–2030 – Optional Extended Maintenance: SAP offers extended maintenance from 2028 through 2030 for an additional fee (approximately +2% on your annual support costs). This maintains official support until December 31, 2030, but at a higher cost. It’s essentially “buying time” if you aren’t ready for S/4HANA by 2027.
- 2031–2033 – Customer-Specific Support: If you still haven’t transitioned by 2030 and don’t choose SAP’s cloud options, you enter customer-specific maintenance. This is a very limited support model through (at most) 2033, providing only critical fixes with no new enhancements. It’s better than being completely unsupported, but it comes with risks and no guarantees.
- RISE Private Cloud Transition Option: As an alternative to the above, SAP now offers a Private Edition, Transition Option under RISE with SAP. This lets you move your ECC system into SAP’s cloud and continue running it with full support up to 2033. In effect, you subscribe to RISE (SAP’s cloud subscription model) but can keep ECC for a few more years until you’re truly ready to cut over to S/4HANA. It buys extra time for complex enterprises, but it comes with subscription fees and contractual commitments (more on that later).
Understanding these timelines is crucial. They set the outer limits of how long you can delay your S/4HANA move.
They also highlight when your negotiation leverage is strongest. For example, opting for extended support (2028–2030) can provide a bit more safety, but it will cost more each year.
Pushing all the way to 2033 via the RISE private cloud option might ensure support, yet it effectively locks you into SAP’s ecosystem and pricing through that period.
Every organization should map these dates to its own roadmap and assess the trade-offs associated with transitioning at the appropriate time.
For more insights on the licensing metrics, see SAP S/4HANA User Licensing Metrics – Named Users vs. Full User Equivalents.
License Conversion Programs
When planning the ECC to S/4HANA migration, a core consideration is how to handle your existing SAP licenses.
Fortunately, SAP has offered conversion programs to smooth the process – but the details of these deals determine whether you end up paying double or getting a fair exchange.
- Cloud Extension Policy: One option is SAP’s Cloud Extension program, which allows you to trade in some of your perpetual ECC licenses in exchange for credits toward SAP cloud subscriptions (like S/4HANA Cloud or RISE with SAP). In essence, you replace on-premise license plus maintenance costs with a cloud subscription, using your past investment as a partial offset. This can be a good path if you’re ready to embrace SAP’s cloud model, as it prevents you from holding unused ECC licenses while paying for new S/4 subscriptions at the same time.
- Contract Conversion Credits: If you’re moving to S/4HANA on-premise or simply converting licenses outside of RISE, SAP offers conversion credits for your existing licenses. In a contract conversion, you terminate (or reduce) your old ECC license contract and purchase new S/4HANA licenses – and SAP gives you a credit for the unused portion of your ECC investment. For example, if you have a large number of ECC user licenses you no longer need, you might receive a credit value that reduces the cost of buying S/4HANA licenses. The goal is to recognize the money you’ve already spent on ECC so you’re not paying twice for equivalent functionality.
- Pitfall – List Price vs. Net Value: Be careful: SAP’s initial conversion offers often use list prices and standard formulas that may undervalue your investment. They might say “we’ll give you a 70% credit” – but 70% of what? If it’s 70% of the list price of your old licenses, and you originally bought at a deep discount, you could be losing out. Don’t accept SAP’s default conversion rate blindly. This is a major negotiation point.
- Negotiation Strategy: Always base the conversion on your net license value – essentially, what you actually paid or the current book value of your licenses – rather than SAP’s list prices. If you have $10 million in ECC licenses (net value after discounts), and SAP’s standard approach only recognizes, say, $5 million of it, push back. Come prepared with your purchase history and maintenance records to demonstrate the real value. You aim to maximize the credit (or discount) so that as much of your prior investment as possible carries forward into the S/4 era. Well-prepared early adopters have negotiated very high credits in the past (even 80–90% in the early years of S/4HANA’s launch). As time goes on, SAP has been reducing these incentives – another reason to negotiate sooner rather than later. The bottom line: insist on getting full value for what you’ve already paid, and structure the deal so that any unusable ECC licenses are effectively discounted from your S/4HANA costs.
For strategies, read SAP S/4HANA Licensing Overview: Models, Metrics, and Migration Strategies.
Negotiating Extended ECC Support
What if you simply need to stay on ECC a bit longer? Many organizations aren’t ready to flip the switch by 2027 and will consider SAP’s extended support or transition options.
These come with extra costs and conditions, but they can be negotiated.
- Extended Maintenance Surcharges: Extended maintenance (2028–2030) typically adds a surcharge to your annual support fees – roughly 2% extra per year (e.g. if standard support is 22% of license value, it might become ~24%). Negotiate to cap these surcharges. For instance, ensure the premium stays at 2% and doesn’t creep higher each year, or push for a flat maintenance fee during the extended period. You might also negotiate that any extended support fees you pay will count toward future credits if you convert to S/4HANA before 2030 (so that money isn’t wasted). The key is to prevent SAP from using your delay against you by steadily ramping up maintenance costs. Make it part of the deal that you won’t be subject to arbitrary increases beyond the agreed uplift.
- Private Cloud “Transition Option” (RISE with ECC): SAP’s offer to run ECC in a RISE private cloud until 2033 can be a lifeline for those truly needing extra time. However, treat this as a bridge, not a destination. When negotiating a RISE private cloud deal for ECC, build in exit clauses and flexibility beyond 2030–2033. For example, ensure you have the right to terminate the cloud subscription or switch to S/4HANA earlier without heavy penalties. Confirm that you’re not locked into paying for ECC hosting past 2033 if you don’t need it. Essentially, you want an “off-ramp” in case your plans accelerate or if the costs become unsustainable. Also, negotiate incentives for an earlier move – e.g. credits for moving to S/4HANA ahead of schedule. SAP may be open to offering a rebate or discount on your S/4 subscription if you leave the ECC-in-cloud arrangement before the final deadline. This way, you’re rewarded (or at least not penalized) for transitioning sooner.
- Leverage Third-Party Support Carefully: (Side note – even if not using SAP’s extended maintenance, some companies consider third-party support providers as a bargaining chip. If you mention that you might go to a third party for support after 2027, SAP could become more flexible on terms to keep you. Please note that third-party support means no new updates, only break-fix assistance. Use this option only if it aligns with your IT strategy, but it can be a useful negotiating lever with SAP when discussing extended support pricing.)
In any scenario, make sure any short-term extension plan comes with long-term clarity. You don’t want to wake up in 2031 still on ECC and out of options. Negotiate now to keep control over the timeline and cost.
Timing and Leverage
In SAP negotiations, timing is everything. Your bargaining power with SAP will wax and wane depending on the calendar.
Here’s how to think about it:
- 2025–2027: Leverage is at its peak. This period (right now through the end of mainstream support) is when SAP is highly motivated to lock in S/4HANA migration commitments. SAP has aggressive revenue targets for S/4HANA and its cloud offerings, so they are more likely to grant concessions to customers who decide early. Suppose you engage SAP now, before the 2027 deadline. In that case, you can secure better discounts on S/4 licenses or subscriptions, more generous conversion credits, and even special perks like extended dual-use periods (where you run ECC and S/4 in parallel) at no extra cost. Early movers can often negotiate bigger bang for the buck because SAP wants success stories and doesn’t want you exploring alternatives (like third-party support or competitors’ software).
- 2028–2030: Leverage starts shrinking. Once mainstream support has lapsed and you’re in the extended maintenance window, SAP knows you’re essentially paying for time. Your choices are fewer – either pay the maintenance premium, move to S/4HANA/RISE, or possibly leave SAP support entirely. At this stage, SAP might be less generous with conversion credits or discounts, because the pressure is now on you. They realize that if you’ve waited this long, you likely must make a deal before 2030. You can still negotiate (for example, if you threaten to go to third-party support or delay until 2033 via RISE, SAP will want to sway you back). But expect tougher negotiations and smaller incentives compared to the pre-2027 offers.
- 2031–2033: Leverage is minimal. If you haven’t migrated by 2030 and are hanging on via the customer-specific maintenance or the RISE transition extension, SAP is in the driver’s seat. By 2033, they assume nearly everyone will be off ECC one way or another. You may have to accept whatever terms are left just to stay supported. At this late stage, SAP has little reason to offer discounts – in fact, your costs could skyrocket if you need special support. And if you’re still not migrated, you risk running an unsupported system after 2033, which is a high-risk, high-cost position to be in. In short, the later you wait, the more you’ll pay (and the fewer favors you can ask).
The lesson: act while you have leverage. Treat 2025–2027 as your golden window to get a favorable deal. The longer you delay, the more the balance of power shifts in favor of SAP. Procrastinating might seem convenient now, but it can corner you into an expensive commitment later.
Key Negotiation Playbook
To navigate the ECC to S/4HANA transition wisely, you need to negotiate a contract that’s as future-proof and flexible as possible.
Consider this your negotiation checklist or playbook – these are the elements to secure in your agreements with SAP:
- Contractual Flexibility: Don’t get locked into rigid license quantities that don’t reflect your actual use. Aim for terms that allow “true-downs” (reducing license counts) at certain intervals, like at renewal or annually. For example, if you have 1,000 users today but might only need 800 after streamlining processes in S/4HANA, you want the ability to adjust those numbers and not pay for shelfware. Also, include options to swap license types if needed (e.g., if you over-bought one module and under-bought another). Flexibility in the contract ensures you’re not overpaying for idle capacity and can adapt as your business changes.
- Price Locks for Expansion: Negotiate price protection for additional licenses or users in the future. This means if you need to buy more S/4HANA users or additional modules later, SAP can’t charge you a higher unit price than what you initially agreed. For instance, if your current S/4HANA Professional User price is $X per user, and two years from now you need 200 more users, a price lock clause would ensure those 200 come at $X each (perhaps with an inflation adjustment cap, but nothing drastic). This guards against the scenario where SAP gives you a great upfront deal but then gouges you on later expansions when you have less negotiating leverage.
- Migration Credits for Unused Licenses: If you have ECC licenses or components that you won’t need in S/4HANA, negotiate how those will be credited or compensated. Maybe you have a whole module (like ECC Manufacturing or Warehouse Management) that you’ll drop in favor of a third-party solution, or simply a chunk of licenses that turned out to be surplus. As part of your S/4 migration deal, secure credit for these unused licenses. The credit could be a direct reduction in the price of the new licenses, or perhaps a services credit (SAP could provide training, migration support, or consulting hours of equivalent value). The point is to get value for everything you’ve already paid for, even if you won’t use it in the future. Don’t allow a situation where you keep paying maintenance on a dead asset or throw it away without any benefit.
- Dual-Use Grace Period: Insist on a grace period for dual use of ECC and S/4HANA during your transition. This is critical for a smooth migration – you might need to run ECC in parallel with S/4HANA for several months (or longer) while you validate the new system, train users, and gradually cut over modules. You should not have to pay for two full sets of licenses during this overlap. SAP has, in some cases, allowed 6-12 months of dual-use rights at no extra cost when negotiated upfront. Clearly document this in the contract: for example, “Customer may continue to use SAP ECC software for up to 12 months after S/4HANA production go-live, for transitional purposes, without additional license fees.” Also, ensure maintenance fees aren’t doubled up during that time. This way, you avoid the “double pay” trap and reduce risk by not rushing the switchover.
- Exit and Transition Clauses: If you are entering into any long-term arrangement (like a RISE with SAP subscription, a multi-year S/4HANA contract, or an extended ECC maintenance agreement), include exit clauses and safeguards. You want the ability to pivot if needed. For instance, if you sign a 5-year RISE contract in 2025 to cover you through 2030 (with ECC in private cloud, then moving to S/4), negotiate an option to terminate or downscale after 3 years in case your plans change (maybe you complete the migration early or decide to switch to a different hosting strategy). Similarly, if you’re in the Private Cloud Transition Option to 2033, ensure there’s clarity on what happens post-2033 – do you automatically transition to a full S/4HANA subscription? Can you exit without penalties? Don’t leave those answers solely in SAP’s hands. Essentially, avoid being trapped. An exit clause might specify conditions under which you can cancel the deal or renegotiate (for example, if SAP’s pricing for post-2033 support is unacceptable, or if the cloud service doesn’t meet certain performance benchmarks). By having these clauses, you maintain leverage throughout the life of the contract, not just at the signing.
Think of these points as your defense against surprises.
A well-negotiated contract can save millions and prevent headaches down the road. It’s much easier to get these terms in writing before you sign, when SAP is eager for your business, than to try to add them later.
Pitfalls to Avoid
During the rush of an ECC to S/4HANA migration, many organizations make avoidable mistakes in their licensing agreements. Steer clear of these common pitfalls:
- Double-Paying in a RISE Deal: Be cautious when moving to RISE with SAP (the all-in-one subscription). If you simply sign a RISE contract for S/4HANA without addressing your existing ECC licenses, you could end up paying for the new subscription while still carrying the cost of your old licenses. This often happens if you don’t get credit for the ECC licenses you “turn off.” Always ensure the RISE deal explicitly accounts for your ECC license base – either through credits, maintenance waivers, or some form of compensation. The goal is to avoid paying maintenance on ECC and a subscription for S/4 simultaneously for the same set of users. If negotiated properly, your ECC licenses can be put into a sort of hibernation or given a residual value in the new deal. Don’t let SAP “forget” the investment you’ve already made.
- Signing Multi-Year Transitions Without Exit Options: SAP might offer a multi-year migration bundle – for example, a deal that covers extended ECC support for a couple of years and then a switch to S/4HANA or RISE by a certain date. These can be attractive, as they package everything together. However, if such a deal lacks flexibility, you could be stuck if circumstances change. Maybe your business is acquired, or you decide to accelerate the timeline, or perhaps S/4HANA isn’t delivering expected value, and you want to pause. Whatever the case, a rigid long-term deal could become a cage. Avoid contracts that commit you to a course without “off-ramps.” Insist on review points or the ability to adjust the plan. If SAP is confident you’ll move to S/4, they should have no issue building in clauses that let you recalibrate along the way instead of binding you to a fixed schedule no matter what.
- Waiting Until the Last Minute: Delay is dangerous when it comes to SAP negotiations. Some customers hope that by waiting, they might catch a last-second fire sale or that SAP will blink and extend deadlines. The track record suggests otherwise: SAP has been firm about the 2027 and 2030 dates, and incentives for conversion have been shrinking each year. If you approach SAP in late 2026 or 2027 with no prior preparations, you’ll be negotiating under duress. SAP knows you have limited time and will be less inclined to offer generous terms – after all, at that point your risk of going off support is very real, and they assume you won’t want that. Plus, your internal project will be rushed and likely more expensive (consultants, overtime, etc.). In short, don’t lose your negotiating leverage by procrastinating. Engaging early costs nothing, and it sets you up for a better outcome.
- Overlooking Support Uplift Clauses: When you do sign new agreements, read the fine print on support fees. SAP often includes clauses that allow for annual support cost increases (for example, a 3% annual inflation adjustment). In extended maintenance contracts or cloud subscriptions, there might be built-in escalators after a certain period. If you miss these, you could be budgeting for X and suddenly paying X+5% in a couple of years with no recourse. Negotiate caps on any maintenance or subscription fee increases (e.g., no more than CPI or a fixed 2% per year). And specifically for extended ECC maintenance, clarify that the surcharge is fixed and won’t compound or jump unexpectedly. This will prevent nasty surprises, such as a 2% fee becoming 5% by 2030, or your cloud subscription price rising steeply after a promotional period. Lock it down in the contract to keep cost predictability.
Avoiding these pitfalls comes down to due diligence and foresight. It’s about thinking two steps ahead in the chess game of SAP negotiation, rather than taking the first shiny deal that’s offered or burying your head in the sand until deadlines loom.
Understand what drives costs, SAP License Cost Drivers – Named Users vs. Engines in S/4HANA.
ECC to S/4HANA Migration Timeline & Leverage
To summarize the timing factors, here’s a quick timeline of key deadlines and how they impact your negotiating leverage as a buyer:
| Deadline | SAP’s Offerings at This Stage | Your Leverage | Risks if Ignored |
|---|---|---|---|
| 2027 – Mainstream Support Ends | Move to S/4HANA or opt into Extended Maintenance (or RISE). SAP eager to lock in migrations by this date. | High leverage: SAP wants deals and will negotiate actively. Early movers get the best discounts and incentives. | If you ignore 2027, you face higher migration costs later. Conversion credits and deals will shrink after this, and you’ll start incurring extra support fees. |
| 2030 – Extended Maintenance Ends | Last chance with SAP’s official support (unless going to RISE private option). Options: complete S/4HANA transition, enter RISE transition to 2033, or drop to limited support. | Moderate leverage: Fewer options now. SAP knows you’re under pressure, but still might offer incentives to get a cloud commitment. | If you ignore 2030, you roll into costly or unsupported territory. You’ll pay hefty maintenance surcharges or be forced into a cloud transition with less negotiating power, potentially on unfavorable terms (lock-in risk). |
| 2033 – Final Transition Period Ends (RISE Private Cloud or Customer-Specific Support) | By end of 2033, all SAP-provided lifelines expire. Beyond this, no standard support for ECC. | Low leverage: Virtually no bargaining power left. SAP expects you to have migrated; otherwise you’re an exception case. | If you’re still on ECC past 2033, you face very high costs (perhaps premium custom support fees) or run completely unsupported. No flexibility remains – you may be forced off ECC under duress, with no negotiating room on pricing or terms. |
Use this timeline to plan backward: the earlier dates give you the strongest hand to play. Don’t let the final deadlines dictate your strategy – by then, it’s checkmate.
FAQs
What happens to ECC licenses after moving to S/4HANA? → They’re usually converted or put on a shelf. In a contract conversion, your ECC licenses are retired, and you get credit towards S/4HANA licenses. If you move to a subscription (like RISE), the ECC licenses can be terminated, so you stop paying maintenance. Always negotiate to get value for those ECC licenses (credits or discounts) in the new deal.
Can I delay my S/4HANA move until 2030? → Yes, you can delay by paying for extended maintenance through 2030 (or using third-party support), but expect significantly higher fees and diminishing leverage. By 2030, you’ll be paying a premium just to keep ECC running, and SAP will have less incentive to offer you concessions. Delaying is technically possible, but it will incur additional costs and leave you with fewer options.
Is SAP’s Private Cloud Transition Option a good idea? → It can be a useful bridge if you truly need it until 2031–2033. It buys you time by letting you run ECC in SAP’s cloud with support. However, it’s only a good idea with strong exit clauses. Make sure you’re not locking yourself into an untenable long-term commitment. You should use it as a short extension, with the freedom to jump to S/4HANA (or even leave SAP) when you’re ready.
Do we need to “rebuy” licenses for S/4HANA? → No, in theory you shouldn’t pay twice for the same scope of functionality – but it depends on how you convert. SAP will swap or credit your existing licenses toward the new ones if you negotiate it. If you handle it poorly, it might feel like rebuying because you’ll pay a lot. The key is to use SAP’s conversion programs: trade in your old licenses for new licenses or subscriptions so that you’re only paying the incremental difference. Always negotiate those credits based on the real value of your original licenses.
Can we run ECC and S/4HANA in parallel during the migration? → Yes, and in fact, many companies do a phased migration. But you must insist on a free dual-use period in your contract. Get SAP’s agreement that for a certain time (e.g,. 6-12 months) you can run both systems in parallel without additional license charges. This avoids double-paying maintenance and gives you a safety net to fall back on ECC if something in the S/4 launch needs tweaking.
Five Expert Recommendations
- Map all ECC licenses before engaging SAP. Do an internal audit of what SAP software and user licenses you have, and how much you’re actually using. This inventory is your power – it shows where you might have shelfware to drop and what you truly need in S/4HANA. It also prevents SAP from “selling” you something you already own under a different name. Go into discussions with a clear picture of your entitlements.
- Negotiate conversion credits based on net value, not SAP’s first offer. SAP’s initial conversion or upgrade proposal might undervalue your existing licenses. Push back. Present the net license value you’ve paid and use that as the baseline for credits. Your goal is to minimize net new spend by maximizing recognition of your past investments. If SAP offers 50% credit but you think it should be 80% given your circumstances, make the case with data and, if needed, comparisons to what peers have received.
- Secure a dual-use grace period to avoid double payments. When structuring the migration plan, make sure you won’t be paying for both ECC and S/4HANA at the same time. Negotiate a grace period where you can run the old and new systems concurrently as you cut over. This should come at no extra license cost – essentially, a temporary free pass on one of the environments. It’s a common ask and can usually be obtained if you raise it early.
- Treat 2025–2027 as your prime leverage window – act early. Don’t wait for the last year. Start engaging SAP well ahead of the 2027 end of support. Let them know you’re planning and weighing options. Early engagement often leads to offers of incentive programs, larger discounts, and more attention from SAP execs eager to win your business. By 2028, those nice-to-haves may vanish. Use the next couple of years to play vendors against each other (SAP vs third-party support, or even SAP vs other ERP alternatives) and lock in the best deal while SAP is motivated.
- Avoid long-term lock-in beyond 2030/2033 – demand exit clauses. Whether you sign up for RISE with SAP, extended maintenance, or any bridge contracts, always include conditions that let you exit or change course by the time key deadlines arrive. You do not want to be stuck in 2031 with a contract that forces you to pay for ECC until 2033, even if you’re ready to migrate, or one that automatically rolls into a costly S/4HANA subscription without negotiation. Structure your agreements so that you retain control over the timeline. This might mean having a break clause at 2030 to evaluate options, or a provision that any post-2030 extensions require mutual agreement. Keep your options open – it will enable SAP to continue earning your business on your terms.
By following these strategies and recommendations, you’ll navigate the ECC to S/4HANA transition with far greater confidence and cost control. Remember, this migration is a once-in-decades change – taking the time to negotiate the fine print now can save you from years of regret later. Good luck on your journey to S/4HANA, and happy negotiating!
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