IT Skills Shortage: Bad for Organizations, Good for MSPs

IT Skills Shortage: Bad for Orgs, Good for MSPs

Written by Kelly Teal
November 24, 2020

And when it comes to SAP applications, there’s urgent need, according to new research from Ensono.

The IT skills shortage is real. And SAP users relying on old versions of the brand look to take the next hit. The good news is, managed service providers will fill the gap.

The problem all starts with trying to migrate legacy, premise-based SAP platforms to the public cloud. Even though SAP now offers cloud versions of its data management tools, many of its customers don’t have the resources to lift their older SAP applications into the modern era. There just aren’t enough experts.

That’s one of the conclusions Ensono, a hybrid IT services provider and SAP on Azure specialist, reaches in its new report, “The True Impact of the SAP Skills Crunch.” Using Vanson Bourne, the Chicago-headquartered channel partner surveyed 100 in-house senior SAP professionals in the U.K. to assess the premises-to-cloud SAP situation. Overall, the findings come out a bit dire for end users.

For instance, Ensono found that 70% of respondents agree migrating SAP to public cloud will benefit them more than keeping SAP in the private cloud or on premises. As a result, 60% of organizations want to go all-in on public cloud.

Cloud Migration Issues

But most SAP applications still reside on premises because of migration barriers. Just more than a third (35%) of respondents said SAP skills would hinder their organizations’ move from on premises to cloud. That same percentage also cites lack of public cloud skills as an issue. Meanwhile, almost one-third (29%) told the channel partner that an IT skills shortage related to legacy technology presents a real problem.

Because of that, only 4% of respondents have wrapped up an SAP-to-public-cloud migration. One-half have yet to start. Of those who have not finished the journey:

Eighty percent have either postponed or cancelled their migration plans altogether.
Nine percent have avoided making plans, due to the SAP skills shortage.
Seventy-four percent have either postponed or canceled their migration plans.
Twenty-three percent have avoided making them, citing a public cloud skills shortage.

Furthermore, 43% of respondents said security poses an obstacle when trying to move SAP into the cloud. The challenges could be overcome, were it not for an IT skills shortage.

Ensono’s Oliver Presland

“We are in the midst of an IT talent drought that is holding organizations back, constraining their ability to transform, causing business bottlenecks, competitive disadvantage, security issues and compliance risk, said Oliver Presland, vice president at Ensono.

Barney Taylor, managing director for Europe at Ensono, agreed.

Ensono’s Barney Taylor

“It is undeniable that there is a shortage of skills in many areas, with an increasing shortage of skills in SAP,” Taylor said. “However, a large part of the problem businesses face is how they are adapting their workforce to meet changing times. Demand for cloud and SAP skills has risen significantly over the last few years, and as our findings indicate, adjusting to these conditions hasn’t been easy. Few organizations are meeting cloud or SAP demands successfully.”

IT Skills Shortage = SAP Churn?

For SAP, the question becomes one of risk and customer churn. Ensono found that if the SAP or cloud skills gap remains unaddressed, many organizations will abandon the tech stalwart.

Indeed, 14% of respondents told the channel partner they will completely move off SAP over the next three years. Forty-four percent said they will not maintain their SAP portfolios. One-quarter said they will move away from SAP. And another 15% intend to reduce the number of SAP applications they use. None of that comes as welcome news for SAP, which is struggling. Meanwhile, the end users who keep SAP still will face that IT skills shortage.

Ensono’s Simon Ratcliffe

“Each business will have different methods for managing that challenge depending on their situation,” said Simon Ratcliffe, principal consultant at Ensono.

One fix?

“[A] partnership with a managed service provider — acting to support an in-house team,” Ratcliffe said.

To be sure, MSPs represent the obvious solution to the IT skills shortage. And yet, just under a quarter of the organizations Ensono (an MSP itself) surveyed use an MSP for SAP applications management.

That looks to change, though.

More than one-third (34%) of respondents told Ensono they expect to use an MSP for SAP portfolio help within three years.