Bluff or Best of Breed

Comparing prices only makes sense if you compare comparable services realistically - and not just in the short term! With Rise, SAP presents an offer that looks very attractive at first glance. But a closer look at the comparative calculation reveals the famous apples-to-oranges comparison. The decision for or against Rise with SAP should therefore be a question of the business case!

In the comparison scenarios, the total costs are to be considered: Licenses, Operations, and Services. Rise only shows a package price. This total package is compared with a license migration to S/4 on-prem, together with the costs of in-house operation. SAP specifies the costs of the license migration without taking into account a real negotiation outcome. 

The right comparison

It is therefore recommended to calculate the comparison scenario of a self-operated on-prem solution: Does it make sense to switch to the S/4 user model (contract conversion) or do my contracts offer me advantages worth keeping (product conversion)? What is the optimal user distribution? Are all desired supplementary products included in Rise? Do I need the Hana Enterprise Edition or is the Runtime Edition sufficient? Are all products included, e.g., Digital Access (on-prem still discounted at 90 percent until the end of 2022) and Solution Manager (chargeable in the cloud, but on-prem license-free)? Do the products included with Rise add value?

Together with the costs for operations and services, I thus contrast the Rise model with a comparable cost model on-prem: an apples-to-apples comparison! Rise differs from on-prem mainly in two points: the switch to a rental model and the outsourcing of SAP operations externally. Often forgotten in the business case is that there are comparable alternative models (best of breed). In addition to standalone rental solutions, the leasing model is still possible - after its contract term, the costs drop to zero, while the rent usually increases after the lease expires. There is also the question of operating a private cloud via classic hosting providers/hyperscalers. It is often worth considering the best-of-breed alternative for SAP operation.

Scale and quantity structure

Scalability is considered the main argument for cloud solutions. However, it should not only refer to quantity scaffolds, but also to the constellation of different SAP products (additions to services). This requires a "configuration option" as we know it from purchase contracts. For the S/4 users, the configuration is already anchored in the user model. For the volume-based cloud metrics, a comparable flexibility must first be contractually fought for.

A decision for Rise with SAP is a life decision. When the contract ends, all that remains for an SAP customer is the raw data. Whereas in the past it was common to switch maintenance, service and hosting providers for cost and quality reasons, with Rise you are tied to one provider. No business case will ever take this point into account - but it is part of the overall consideration.

Evaluating alternative private and public cloud scenarios makes strategic as well as commercial sense. With Rise, SAP has taken a step in the right direction that is worth considering. However, it is urgently recommended to validate the business case, taking into account a fair on-prem license migration for the licenses and a real benchmark for operations.