If you’re an executive thinking about implementing S/4HANA for the first time in your career, you’re not alone, and you’ve got some choices to make. We think that’s a good thing and thought outlining the options along with how they align with specific business needs would help.
As digital transformation continues to drive business strategy, CXOs are being asked to step up and deliver real organizational change. That’s a far cry from the days of IT being the group that compiles reports and keeps the lights on; now the business expects information in real-time. Aligning your S/4HANA deployment strategy with business needs is an important first step. The choices proliferate as quickly as the acronyms used to describe them. On-Prem or Cloud? Single Tenant or Multi-Tenant? Should I consider Platform-as-a-Service or will Infrastructure-as-a-Service meet my needs?
Many companies are getting confused by the number of different—and viable—deployment choices they have. So, where do you start?
When it comes to rolling out an enterprise-wide software solution, start by considering where your business is right now. You’ll want to examine a number of factors, including the size and complexity of your organization, its commitment to digital transformation, its preference for CapEx or OpEx budgetary models, and competitive drivers such as time-to-value.
Next, assess your business priorities. What do you need to move your business forward? Our clients typically cite three important drivers:
We’re seeking AUTONOMY AND CONTROL – because we’re continuously changing
We’re seeking AGILITY – because projects have to happen quickly
We’re seeking STANDARDIZATION – because we need streamlined processes
If your primary driver is autonomy and control, consider these options:
For some companies, particularly those in highly regulated industries, control over their data, infrastructure, and IT assets is essential. Generally, these organizations prefer to invest in infrastructure and software licensing as well as the expertise to maintain the system and its customizations. Increasingly, On-Premise environments (either housed in your data center or hosted by a third party) provide flexible options to customers seeking control and autonomy over their business process configuration, their data, their IT hardware assets, and upgrade/maintenance cycles. You can begin with SAP’s baseline (Best Practices) and work with a partner, such as Enowa, to make the system fit your unique differentiators.
Advantages: Full control over data, configuration, customization, maintenance, and upgrade cycles.
It’s the deployment option you’re likely most familiar with and it’s available for S/4HANA. Autonomy? There’s plenty. You buy SAP licenses and pay annual maintenance on your license footprint in perpetuity. You purchase the infrastructure through capital expenditure, choosing the hardware you want your system to run on in your on-site data center or with a colocation provider.
Advantages: Full control over hardware usually managed by your own employees.
The hosted public cloud, including AWS, Google, and MS Azure, offers high levels of control over your SAP landscape, while providing you with better scalability and agility as an end-to-end information platform. In this model, you still own your S/4HANA licenses, but move your infrastructure and services to a tested cloud platform that delivers high levels of availability and privacy. These cloud providers easily support and integrate additional hosted software packages you may be using to run your company.
Advantages: Focus on the deployment and management of your applications. Achieve faster time-to-value by leveraging a large-scale, flexible, scalable hosting platform with built-in security, high-availability, and disaster recovery solutions. Predictable CapEx and OpEx costs.
Like the above Hosted Public Cloud option, deploying through a Hosted Managed Cloud provides you with the control and autonomy you’re looking for, but your infrastructure and services are maintained through a dedicated provider who has deep, specific experience with SAP’s products, their release levels, upgrades, and dependencies, as well as with common SAP peripheral systems such as Concur, Ariba, and C/4HANA.
Advantages: The Hosted Managed Cloud environment is SAP-specific, which differentiates it from the Hosted Public Cloud’s and still enables you to focus on the deployment and management of your applications. Achieve faster time-to-value by leveraging a partner that intimately knows SAP technology.
If your primary driver is agility, and you’d like to test the viability of the cloud for your business, consider this option:
You want to eliminate the time and tedium involved in managing your technology and take advantage of SAP’s standard business processes and preconfigured capabilities. And your CFO has indicated he or she would like to see a shift from hefty capital investments to ongoing operational expenses. Still, you’re not sure you’re 100% committed to SAP’s defined processes.
S/4HANA STE provides a sound alternative. In this deployment model, you have your own SAP database within HEC (SAP’s datacenter) with an independent instance of the application and its supporting infrastructure. It’s inherently secure, because your data is isolated, and availability and performance are not dependent on shared resources. SAP also provides some good incentives for choosing STE, including access to standard business processes along with the ability to extend those processes without performing modifications, easy integration with APIs white listed by SAP, and upgrades twice a year with some flexibility on timing.
Advantages: Predictable OpEx costs, improved business agility, innovation cycles with flexibility.
If your primary driver is standardization, consider this option:
Right now, SAP Multi-Tenant Edition might be the “truest” example of everything the cloud is meant to achieve. It’s what it sounds like: an architecture and configuration where a single instance of S/4HANA is shared by a number of different companies. Your business information is partitioned, keeping your data separate and secure, but because you are pooling resources, you can take advantage of real cost efficiencies.
SAP’s MTE subscription comes preconfigured and your company would receive prescribed upgrades along with all other MTE customers simultaneously four times a year – this is the reason it requires standard configuration. MTE is less flexible than STE, but the standardization of business processes does provide faster time-to-value, during implementation and across the upgrade cycles. If you think your organization can benefit from that level of standardization, MTE is a great option to consider.
Advantages: Fast time-to-value, lower upfront costs (excluding change management), standardized business processes with predictable OpEx costs, quarterly released innovation cycles giving access to the latest enhancements.
If you’re considering options for deploying S/4HANA you’ve probably found some challenges. To make the right decision for your organization, you need a clear understanding of what your options are and how those choices align with your business goals. Enowa can help, contact Rick Place and the Enowa team at (610) 296-3640 or by e-mailing firstname.lastname@example.org.
Rick Place has held various management positions at organizations which offered IT and SAP services. Rick has been in the SAP ecosystem since 2000 and has built a wide network of professionals including executives who face large business and IT challenges. In 2004, Rick joined Enowa to further establish the US business in various capacities including sales, marketing, recruiting, partnerships, delivery and operations. Today, Rick works with many of Enowa’s clients who are looking to make progress in how they run as a business, by leveraging SAP products. In this capacity, Rick has worked with executives from the early stages of future S/4 considerations through successful go lives. This unique vantage point enables Rick to be a trusted partner in sharing S/4 options to meet the individual needs of Enowa’s clients.