The first half of 2024 saw a 26% increase in aggregate job placement volume, according to Baer data. While the market for contingent S/4HANA specialized expertise has not yet reached the incredible pace of the early pandemic, demand is steadily increasing. But an increase in demand is only part of the story. The SAP contingent labor market is vast. To implement and maintain the software requires hundreds, if not thousands, of both commonplace and highly specialized skillsets. There are trends within verticals, trends in demands for specific skillsets, and even trends in where and how you engage your contingent workforce.
No trend exists in a silo—they are interdependent and have ripple effects. Demand for expertise in one industry may limit the ability of an enterprise in a completely different area to access specialized expertise when and where it’s needed. And that impacts how and when your program rolls out, potentially putting timelines at risk.
Following are three emerging key trends that are currently impacting the S/4HANA contingent labor market.
SAP is all-in on RISE, and it appears more of its customers are, too. At Baer, we’re seeing a steadily growing set of global and national enterprises choosing truly transformative, greenfield, clean-core S/4HANA implementations. Previously, we have seen more large enterprises choosing brownfield implementations due to the complexity, risk, and expense of completely transforming all their processes and systems, especially if they wanted to complete work prior to the 2027 end of mainstream maintenance for Business Suite 7.
This indicates that SAP’s vision for the future of the enterprise that they have so earnestly been painting is at long last landing. More enterprises are connecting with it strongly enough that they are willing to go this route. A decision to go this route is more strategically driven and less financially driven than the earlier brownfield implementation trend. These transformations will undoubtedly take five to six years—well beyond the 2027 end of mainstream support. So enterprises that go this route are either willing to pay increased fees for maintenance to get things right or they have negotiated a deal with SAP for support concessions in exchange for their willingness to go down its recommended and desired path.
It appears 2023’s return to office bubble has popped. In 2023, 13% of all Baer placements were on site, however our 2024 Q1 and Q2 proprietary data indicates that onsite roles comprise only 6% of placements. And while fully remote roles remain the dominant approach at 62% of placements, it’s hybrid roles that are seeing the greatest growth momentum. In 2023, they represented just 13% of all Baer placements, but this year, they are at 32%. That’s quite an increase. A primary driver behind this trend is the exceptional project management skills required to manage a fully remote workforce for such a complex initiative.
What constitutes a hybrid role? There is no one clear definition of hybrid roles. For some enterprises, it means being in the office at project kickoff and for certain milestones, while for others it means a percentage of time. But travel is costly, and contingent workers with existing contracts stipulating fully remote work may be reluctant to make the change.
You can read an in-depth analysis of this trend on our website: What 2024’s Massive Increase in Hybrid Contingent IT Roles Means for Your SAP S/4HANA Transformation.
Another interesting trend I am seeing is that the earliest S/4HANA adopters are already finding that the releases they are currently in production on are outdated and no longer supported. While being first to market might have seemed like a strategic advantage, in some cases the technology was so nascent that SAP was not offering long-term support agreements. To stay current, these enterprises must upgrade to a supported version. In addition, the software has evolved so significantly, and SAP has introduced so many new capabilities, that is driving some to reevaluate their initial approaches.
It's essentially a project behind a project, and the trend is driving a small but unexpected demand for very niche experience.
The upshot is that the SAP S/4HANA labor market is extremely complex, fragmented, and competitive. SAP continues to invest heavily in the solution and it’s continuously evolving, creating demand for expertise in emerging technologies like GenAI. Add to it that these implementations are measured in years. The path you set at the beginning of your initiative will likely evolve as much as the technology. And of course, the market is subject to a host of external pressures, as the past several years have shown us. The path you set at the beginning of your transformation will likely evolve, and so will your need for specialized expertise.
Access to the right S/4HANA expertise, at the right time, for the appropriate investment, is critical to the success of your program. Will a traditional IT staffing agency be able to meet the moment? I wouldn’t bet on it. But an enterprise performance partner like Baer, who is looking down the innovation curve, tracking the trends, and proactively identifying expertise can.
At Baer, however the market unfolds, however your program evolves, we’re ready when you are.
Unlike typical technology staffing companies, Baer is a true enterprise performance partner. We have a deep understanding of the scope of enterprise digital transformation and the highly specialized skillsets you will need at different stages of the process.
To learn more about how Baer can make a positive impact on your enterprise transformation, please reach out to Brian Trout, Executive Vice President, Sales, at btrout@baergroup.com, or John Wilson, Vice President of Strategic Accounts, at jwilson@baergroup.com.