Why Siloed Governance, Risk, and Compliance Is Derailing S/4HANA Projects

Mainstream support for SAP ECC ends on December 31, 2027, leaving SAP customers − who represent some of the world’s largest organizations − with a narrowing window to complete one of the most significant ERP transformations in decades. While extended maintenance will be available through 2030 at an additional cost, delaying migration is becoming an increasingly expensive and risky option.

Yet the real challenge facing SAP S/4HANA programs isn’t simply meeting SAP’s deadline. Most organizations have already committed to migration. The bigger question is why so many projects continue to exceed budgets and struggle to deliver the expected business value.

Part of the answer lies in the growing strategic importance of SAP S/4HANA itself. For many enterprises, the move is no longer just an ERP modernization effort, it is the foundation for future AI, analytics, and automation initiatives. If the underlying ERP environment is poorly designed, those downstream digital transformation efforts fail to deliver their expected returns.

One overlooked factor is the way governance, risk, and compliance (GRC) functions are managed during the transition. According to Pathlock’s 2025 Digital Transformation & Access Risk Report, 52% of organizations don’t plan GRC controls early in the migration project.

As the race toward 2027 accelerates, organizations can no longer afford to treat governance, risk, and compliance separately.

Common SAP S/4HANA Migration Mistakes

People often mistake the transition to SAP S/4HANA as just another software upgrade, when in reality, it represents a comprehensive business transformation. In a legacy environment like SAP ECC, GRC often operates separately and independently from other technical and business teams. When GRC processes are siloed, organizations inadvertently carry years of accumulated roles and associated security risks over into a new system.

The complexity of SAP makes this challenge particularly difficult. SAP includes a large number of standard transactions (80,000+) that define what users can do. When organizations focus on SAP in a vacuum, they miss how it connects to the rest of the business. This causes existing security problems and flawed access controls to continue as they migrate into a new system.

SAP S/4HANA includes new technology components such as Fiori.  SAP Fiori introduces new authorizations and user access pathways that must be governed alongside traditional backend SAP permissions.  Meanwhile, SAP Business Technology Platform (BTP) extensions and custom applications often create new business processes, permissions, and integration points that must be included into Segregation of Duties and access-risk analysis.

Organizations that fail to account for these changes early often discover governance gaps late in the project lifecycle. In that scenario, instead of using the transition as an opportunity to modernize governance, they simply recreate existing problems in a more advanced platform, inheriting risks to their workflows spanning finance, procurement, manufacturing, payroll, supply chain, and other critical business functions. As a result, remediation becomes especially costly after go-live.

Best Practices for Streamlining SAP S/4HANA Migration

Successfully navigating these technical shifts requires governance to be embedded from the beginning of the transformation.

The most efficient SAP S/4HANA programs start with an assessment of their current environment. Before redesigning roles or migrating users, organizations should inventory systems, analyze existing access risks, identify Segregation of Duties conflicts, and understand where governance gaps already exist. This creates a baseline that helps teams avoid carrying legacy issues into the new platform.

Next, organizations should establish standardized governance policies that meet business requirements and are aligned with security objectives and compliance obligations. Consistent role design standards, provisioning workflows, access request processes, and risk definitions reduce confusion and improve decision-making throughout the migration project.

Most importantly, governance milestones must become part of the migration roadmap itself. BASIS teams, security leaders, internal audit, compliance teams, and business process owners should work together from the earliest planning stages. Segregation of Duties analysis, controls validation, and role design should start before deployment, not after systems are already in production.

Building the Foundation for What’s Next

The need for integrated governance becomes even more important as organizations accelerate the adoption of AI and automation. The fact is, deploying AI successfully requires organizations to understand who has access to what data across their critical applications and to clean up excessive or outdated access promptly, something that is addressed during a migration project either way. If you have numerous outdated entitlements in your ERP environment and feed that data into AI models, you don’t get better insights. You get faster propagation of bad inputs.

That is why, as enterprises deploy more AI-enabled capabilities on top of SAP S/4HANA, governance, risk, and compliance become essential foundations for success. Without a strong governance framework, organizations risk scaling existing access, security, and data quality problems rather than solving them.

Ultimately, SAP S/4HANA migration represents a rare opportunity to eliminate years of accumulated access risk and build innovation directly into the foundation of the future ERP environment.

Chris Radkowski is an SAP GRC expert at Pathlock, an identity security and governance platform. A recognized leader in access governance with over 20 years of experience driving innovation in enterprise security and compliance solutions, he brings deep expertise in application access governance, risk management and regulatory compliance.