SAP Partner, Mignow specializes in migration to S/4Hana

By December 2027, users of the SAP ECC ERP must convert to SAP S/4Hana, otherwise they will lose SAP Enterprise Support.

Over the past three years, Mignow has distinguished itself in automating migration processes from SAP ECC ERP to SAP S/4Hana. The company has initiated 61 projects, achieved 29 successful go-lives, and established 53 strategic partnerships, both national and international. The year 2023, in particular, was significant for Mignow, with the addition of 20 new clients and the establishment of 30 new partnerships. In this interview, Guilherme Joventino, Mignow's COO, explains how the company is capitalizing on the current market momentum.

How did Mignow come about?

Mignow was born out of a market need. There are approximately 40,000 large enterprise SAP clients worldwide who need to migrate from SAP ECC ERP to SAP S/4Hana, otherwise they will lose SAP Enterprise Support. This means that after December 2027, if Petrobras, for example, hadn't moved to SAP S/4Hana, it would no longer be entitled to updates, such as for tax invoices. In Brazil, we're talking about roughly 1,300 clients who need to make this migration, and we now have less than four years. We should be seeing over 200 go-lives per year, but this isn't happening, and we don't have enough consultants available in the market to meet this demand. Mignow originated as a spin-off from another SAP partner consultancy, which began developing an accelerator in late 2016 and launched it in 2019. We identified that the product had enormous potential and executed this spin-off to give it a life of its own.

Are there other opportunities in the market?

The second problem we identified is that SAP's lifecycle is now different from what it used to be. Previously, an ECC version could go 10 or 15 years without an update. Today, it's only a maximum of 7 years to upgrade, otherwise the client loses support. For example, the last ECC update was in 2015, which is already 9 years ago. All clients who implemented the first versions of S/4Hana have already lost initial support and had to perform at least one upgrade. In 2028, we will have 48,000 clients needing upgrades, which means over 7,300 go-lives per year. This is another problem that no one has paid attention to, and it's even bigger than what's happening today. Clients are paying 22% for SAP support, which is extremely expensive, and they are not receiving any of the new functionalities.

How does Mignow operate?

Considering all of this, we thought about how to solve this problem. Doing it manually is possible, but not feasible. We started developing an RPA-based solution that handles data loads, moving them from one place to another, but it's not a conversion. A conversion requires business understanding and intelligence. So, in 2017, we sought out Artificial Intelligence tools to develop what we now call Mignow. Today, Mignow is the first software capable of keeping SAP updated. I not only update from ECC to S/4Hana but also from S/4Hana to S/4Hana. Today, we are a SAP-certified partner, we are on the SAP marketplace, we have some interesting ESG versions, and we are leaders in certain quadrants with automation for Rise with SAP, which is SAP's new SaaS offering. Mignow is a software that complements Rise with SAP.

What are the benefits for clients?

In a conversion project, we provide over 80% automation, but some tasks still need to be done manually. We have a case with a large Brazilian retailer that had almost 19,000 customized objects; they would have needed to adjust 7,500 objects for the new S/4Hana version. After running Mignow, only 140 objects needed to be addressed, a very significant reduction. If we translate this into hours, understanding, adjusting, and testing each of those 7,500 codes would have taken over 30,000 hours. With Mignow, we completed it in a total of 2,000 hours.

Which clients does Mignow have in its portfolio?

Today, we have major clients such as Carrefour, Drogaria Pague Menos, Votorantim, Eurofarma, Randon, among others in Brazil, and also outside Brazil, like Galler (Belgian chocolatier), EOC (Netherlands), Longping (China), Alouette (Canada). We are currently working with the Central Bank of Costa Rica, a large retailer in Honduras, in addition to a pipeline of deals to close around the world. We are now opening our first international branch in North America.

Does Mignow also implement SAP?

We do not implement SAP; we only handle conversions. Today, we are the only SAP partner in the world 100% specialized in conversion, and that's all we do. No SAP partner that implements ERP includes an agreement for updating to a new version. When a partner sells SAP, they sell the implementation, a project. Once it goes live, the project is over. Then an AMS (Application Management Service) comes in, which ultimately provides support for application management and maintenance, but not a version update. For the market, an update is considered a new project.

What are Mignow's plans?

The December 2027 deadline, by which ECC clients who do not convert to S/4Hana will lose support, is the primary driver for Mignow's business. There's a second driver: clients who already have S/4Hana discover they need to update more frequently, and that's where we come in again. To meet this client need, we changed our business model. We don't sell it as a project, but as a three-year subscription contract, entitling the client to updates and one upgrade per year. Our goal is to create a new market category; we want to be an ERP update company, outsourcing the update process via software. There are other companies that provide this service, but they are more expensive and time-consuming. That's why we have several major partners providing this service using Mignow, such as Deloitte, Cast Group, Atos, ITS, Vexia, T-Systems, Neoris, Essence, and other big names. Approximately 60 partners worldwide are using Mignow in their SAP conversion projects.

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