SAP's RISE with SAP program — the company's attempt to migrate its entire installed base of on-premise ERP customers to the cloud — is the most operationally ambitious undertaking in enterprise software since the Y2K remediation projects of the late 1990s. The scale is staggering: roughly 25,000 on-premises customers running some of the world's most complex and customized business systems, managing supply chains, financial close, manufacturing planning, and payroll for companies that collectively represent a significant fraction of global GDP. Getting all of them to the cloud requires re-platforming mission-critical systems that have been customized over decades, often by consultants who are no longer at the company, on code that in many cases has not been touched in years.
SAP has been clear about the end date: mainstream maintenance for SAP Business Suite 7 — the core on-premise ERP platform — ends in December 2027. After that date, customers who have not migrated to SAP S/4HANA Cloud will pay extended maintenance fees at a premium, and eventually face a system that no longer receives security patches or regulatory updates. The stick is real. The carrot — a modern cloud ERP with AI capabilities, real-time analytics, and a unified data model — is compelling. The path from the stick to the carrot runs through a migration process that makes even seasoned IT executives nervous.
The numbers make the stakes concrete. SAP's cloud revenue reached roughly €17 billion in fiscal 2025, growing 25%. Cloud backlog — contracted revenue not yet recognized — stands at approximately €45 billion. The company's market capitalization is roughly €280 billion, implying a multiple of roughly 16x trailing revenue. That multiple prices in a successful migration. If the migration stalls, the multiple compresses, and the compression will be abrupt because the market has been pricing the cloud backlog as near-certain revenue. Backlog is not revenue. It is a promise to deliver. If the delivery fails, the backlog converts to litigation instead of income.
The structural risk in RISE is not that the SAP software doesn't work. It is that the customer's existing SAP system is so heavily customized that migrating it is closer to a reimplementation than a migration. SAP encourages customers to adopt "standard" processes during migration — to shed the customizations that accumulated over decades and move to best-practice configurations in the cloud. This is good advice and also a confession that the migration path for heavily customized systems is not a lift-and-shift. It is a rip-and-replace of business processes that may have been in place since the first Clinton administration.
A midsize manufacturer with 5,000 employees and a SAP system that was installed in 2003, customized across three generations of IT leadership, integrated with a dozen third-party systems for warehouse management, quality control, and logistics, does not "migrate" to S/4HANA. It redesigns its business processes around the new system, retrains its workforce, rebuilds its integrations, and goes through a cutover weekend that everyone involved will remember for the rest of their careers. The migration is a business transformation project that uses software as the vehicle. The software is the easy part.
SAP disclosed in its Q2 2026 earnings that approximately 60% of its Business Suite 7 customers have either gone live on S/4HANA, are in active migration, or have signed a RISE contract. Research from Precisely found that 64% of companies will be fully live or in the process of migrating to S/4HANA by the end of 2025. The remaining 60% — roughly 10,000 customers — have not yet started. With mainstream maintenance ending in 18 months, the math is uncomfortable. Even if SAP accelerates migrations to 2,000 per quarter — roughly triple the current pace — roughly 4,000 customers would miss the deadline. Those customers face a choice: pay extended maintenance, migrate under pressure, or defect to a competitor. The first option is bad for the customer. The second option is risky. The third option — switching ERP systems at a company that has run SAP for 20 years — is so expensive and disruptive that most will pay extended maintenance and stay.
The locked-in revenue for SAP is real. An ERP system is the stickiest enterprise software category in existence. The data gravity is extreme — every financial transaction, every purchase order, every payroll run, every inventory movement lives in the system and cannot be exported meaningfully to a competitor. The switching costs are measured in years and tens of millions of dollars. RISE's forced migration timeline activates this lock-in: customers who delay past 2027 face a binary choice between paying SAP whatever it asks and undertaking a multi-year ERP replacement project. Most will pay.
The risk for SAP is not that the migration fails entirely. It is that a subset of large, complex, heavily customized customers experience painful, extended, and publicly visible migration failures that freeze the rest of the pipeline. One Fortune 500 manufacturer that misses a quarter-close because the S/4HANA migration went sideways is a scary anecdote. Three of them in a quarter is a narrative. The RISE program is designed to succeed. The question is whether it can succeed without any high-profile failures that spook the customers who have not yet started. The next 18 months will answer it.