Many customers are asking themselves about SAP Private Cloud, Public Cloud, or On-Prem solutions in light of the upcoming S/4HANA transformation. XEPTUM assists companies in selecting and implementing the right architecture, which depends on the specific requirements for the new solution, especially innovation capability or individual customization options.
What are the Differences between SAP Public Cloud, Private Cloud, and On-Prem?
SAP Public Cloud is a SaaS solution hosted in SAP’s own data centers. It offers standardized processes and regular updates, but customization to individual customer needs is very limited. Classic user exits or modifications are replaced here by so-called Side-by-Side Extensions on the SAP Business Technology Platform (BTP), which plays a central role in SAP’s cloud strategy. The SAP Public Cloud is shared by many companies and kept up-to-date by SAP, comparable to a car-sharing model. This means that all users benefit from the latest updates and security standards, but have fewer individual customization options.
SAP Private Cloud offers more customization options and is hosted either in SAP data centers or by an external service provider. It is very similar to a classic on-premise system, with the difference that the Private Cloud is provided exclusively for one company. The customer pays for the use of the system. This allows for greater flexibility and adaptability to specific business requirements, while also leveraging the benefits of a hosted system.
SAP On-Prem is installed and operated on customer-owned servers. The company purchases the SAP system and is responsible for its maintenance, updates, and security. On-prem systems offer the highest flexibility and the most customization options, as they are fully owned and controlled by the customer. These systems can also be operated in the cloud, but even then, the responsibility for operation remains with the company.
Which SAP Deployment Model is Best Suited for My Company?
The choice depends on the specific requirements of a company. For example, the SAP Public Cloud is suitable for customers who prefer quick implementation and predictable costs. New SAP features, such as the AI assistant Joule and other AI functionalities, are always delivered to cloud products first.
In contrast to the SAP Public Cloud, the SAP Private Cloud offers more extension possibilities and is ideal for companies that require more control and customization options.
On-Prem is suitable for companies with strict compliance requirements or specific customization needs. However, it should be noted that SAP pursues a very clear “cloud-first” approach. This means that innovations will primarily be developed for cloud products in the future. With an on-premise approach, there is therefore a risk of falling behind technologically in the long run. Customers should therefore at least consider a hybrid solution approach, where a classic SAP S/4HANA system is extended with SAP BTP services in the cloud.
SAP Private Cloud, Public Cloud, and On-Premise: Overview of the Architectures
What Role Does the SAP Business Technology Platform (BTP) Play in the Cloud Strategy?
The SAP BTP is of central importance in SAP’s cloud strategy. It provides a unified technological foundation that enables companies to extend, integrate, and personalize SAP applications. The SAP BTP consists of various services that can be added either individually or as a license package in the form of SAP GROW and SAP RISE.
For example, Side-by-Side Extensions are possible with SAP BTP. These web applications run in parallel with the SAP Public Cloud or Private Cloud and extend them on various levels. Side-by-Side Extensions replace the classic on-stack extensions from the on-premise world and offer more flexibility and customization options.
SAP GROW and SAP RISE offer support on the way to the SAP Private Cloud and Public Cloud
What is the Importance of SAP GROW and SAP RISE for the SAP Cloud Strategy?
GROW with SAP is a license bundle that helps companies adopt the SAP S/4HANA Cloud Public Edition. It offers cloud-native ERP software along with a package of BTP services and access to a supportive ecosystem of experts and resources from SAP. This bundling aims to help bring existing solutions securely into the cloud.
RISE with SAP is a similar product to GROW, but is based on the Private Cloud. RISE also offers a comprehensive solution to support companies in their digital transformation, but with more customization and control options.
Important! Often, the SAP BTP services offered in GROW and RISE come with capacity limitations regarding the number of users or storage space. Therefore, additional costs may arise. Furthermore, GROW and RISE contracts are legally complex products, where responsibilities such as hosting and maintenance are precisely regulated and partly lie with the customer and partly with SAP.
What Does a Transition to SAP Cloud Products Cost?
The costs for transitioning from On-Prem to the SAP Cloud depend on various factors, such as the chosen migration strategy (Greenfield, Brownfield, or Hybrid), the complexity of existing systems, and the specific requirements of the company. A switch to the SAP Public Cloud can be more cost-effective, as it involves lower initial investments and fewer ongoing operating costs. The Private Cloud can be more expensive, but offers more customization options and control.
Generally, the expected costs heavily depend on the required licenses outside the SAP Public/Private Cloud. To implement existing processes in the cloud, additional BTP services are often necessary. XEPTUM will gladly assist you in selecting the appropriate solutions to enable an optimal architecture for you.
How Can XEPTUM Support your Company on its Journey to the SAP Cloud?
It is important to emphasize that the transformation to an SAP S/4HANA environment is not just a technological decision and the resulting costs, but primarily represents a change project for the company. We recommend using this change as an opportunity to improve processes, organization, and much more.
In addition to our deep expertise in SAP technologies and architectures, we also have extensive experience in the business sector. Please feel free to contact us; we can competently assist you in developing and implementing a suitable overall SAP Cloud strategy!
