Sainsbury's has become the third top-ten UK retailer to join the SAP program to lift legacy applications to the cloud and migrate them to its latest S/4HANA ERP system.
The UK's second-largest retailer – with around £29 billion ($38 billion) in revenue – has signed up with SAP, cloud provider AWS, and systems integration and consultancy biz Accenture to "revolutionize its commercial systems and help drive its Next Level Sainsbury's ambitions."
The retailer said in a statement that through "consolidation of its legacy systems," it would increase "agility through cloud-based solutions, as well as a simplified and cost-optimized technology estate."
Sainsbury's joins fellow UK retailers Co-op and Asda on the RISE with SAP program, launched in early 2021 amid investor concerns that the German software giant was failing to move customers from its sprawling legacy systems to cloud infrastructure and software-as-a-service quickly enough.
Asda has run into delays and spent £430 million ($544 million) on its IT separation from US giant Walmart to the end of December 2023. The difficult project has also seen the departure of digital transformation chief Mark Simpson, who had been with the retailer for 28 years.
Sainsbury's deal will mean around £78 billion ($102 billion) of UK retail revenue – including Co-op and Asda – will be managed by SAP systems under the cloud-based arrangement.
- RISE with SAP sinking year on year
- Now as many as 10,000 SAP jobs to be hit by restructure
- SAP customers warned on hidden risks in the unofficial route to the cloud
- Asda IT staff shuffled off to TCS amid messy tech divorce from Walmart
The Register understands that Sainsbury's will adopt the RISE with SAP program, which will be underpinned by SAP's Cloud ERP solution, S/4HANA for Retail, as well as SAP Business Technology Platform (BTP), SAP Ariba, and other surrounding SAP cloud solutions.
Sainsbury's declined to say which legacy systems it was migrating from, but The Register understands it is not ECC 6.0, the last ERP system before the launch of S/4HANA in 2015.
RISE with SAP launched in 2021, with the vendor promising to help users steer and plan "across the enterprise in real-time, based on one source of truth."
The idea is to lift and shift complex SAP environments into the public, private, and hybrid clouds with SAP being solely accountable to the customer. Once in the cloud, SAP promises to help with migration to the latest S/4HANA and BTP systems, as well as perform the necessary business transformation.
However, users have been sluggish in adopting the plan. Earlier this week, Gartner said RISE projects had been falling over the last year as a proportion of total SAP revenue. The number of customer wins has also fallen from its peak, the global tech research firm revealed. ®