SAP S/4HANA: RISE or GROW?

Rise With SAP is a commercial program launched by SAP on January 27, 2021, aimed at accelerating customers’ move to the Cloud.

Initially, the program covered the following two solutions:

• SAP S/4HANA Cloud (Public Cloud)
• SAP S/4HANA Private Edition (Private Cloud) 

Since the end of 2023, SAP has simplified its business program logic like this: 

• SAP RISE with SAP = SAP S/4HANA Private Cloud
• SAP GROW with SAP = SAP S/4HANA Public Cloud

SAP S/4HANA Public Cloud is a true multi-tenant SaaS solution, updated automatically (twice a year). It is perfectly suited to customers with simpler management needs (no complex supply chain or production processes), and with a good culture of adopting standardized processes (“Fit-to-Standard” approach). To date, only some of the functional processes (Scope Items) available in SAP S/4HANA Private Cloud are available on SAP S/4HANA Public Cloud. The S/4HANA Public Cloud roadmap is available online (Access the S/4HANA Public Cloud roadmap) and indicates a functional convergence of the two versions by 2025. Beyond this date, new functionalities will be offered on S/4HANA Public Cloud before eventually being ported to the Private Cloud version. 

With SAP S/4HANA Private Cloud, SAP is pushing less towards Cloud logic than with SAP S/4HANA Public Cloud in terms of simplification. SAP S/4HANA Private Cloud is aimed above all at customers with complex landscapes or processes who wish to retain the same possibilities for parameterization and specific developments as with an On Premise solution. For SAP ECC6 customers, this is the only version for which SAP offers automatic migration or conversion tools (for SAP S/4HANA Public Cloud, only a GreenField project, a new installation, is currently possible, and we do not know whether SAP plans to offer migration tools in the future);

With SAP S/4HANA Public Cloud, SAP’s objective is to push customers towards maximum standardization of the solution implemented, in order to facilitate and even automate version upgrades (as is the case for multi-tenant SaaS solutions). This implies a strong limitation of the specific applications and technologies that can be used to implement these specific applications. However, the high degree of standardization of the SAP S/4HANA Public Cloud solution does not prevent it from being customized thanks to the Extensibility possibilities offered by SAP directly within the ERP. And for customers who want to go even further, specific programs can be created via the SAP Business Technology Platform (SAP BTP) and its numerous services available in the cloud.

As far as infrastructure and related services are concerned, customers have no choice but to entrust SAP with all supervision and facilities management services. Customers and partners have virtually no control over this infrastructure. During migrations, they can only rely on SAP services for all technical aspects. With SAP S/4HANA Private Cloud, customers have more choice, and can decide to carry out a certain number of outsourcing services themselves (or entrust them to the partner of their choice, such as Applium, which offers S/4HANA Private Cloud outsourcing). They can also choose which hosting partner (Microsoft Azure, Amazon Web Services, Google Cloud or IBM Cloud) SAP will work with;

SAP S/4HANA Public Cloud or Private Cloud consists of a single product number (SKU) covering, in the form of an annual subscription with SAP or an authorized reseller, the following elements:

• Right to use SAP S/4HANA
• Maintenance/Support
• Technical infrastructure (servers)
• Supervision and outsourcing services for SAP infrastructures and lower layers (Run System)

It’s very clear that SAP has chosen to invest heavily in SAP S/4HANA Public Cloud and make it its central ERP solution for the future. SAP S/4HANA Private Cloud and Public Cloud initially shared the same code, with the Public Cloud version being a subset of the Private Cloud version in terms of Scope Items. This approach is no longer true since 2022, when SAP announced that numerous functionalities would be developed specifically for the Public Cloud version. The two solutions will therefore evolve according to two distinct roadmaps, and there is every reason to believe that the Public Cloud version will accelerate at the expense of the Private Cloud version.

For all customers considering SAP S/4HANA, SAP requires an initial qualification (Digital Discovery Assessment – DDA) to verify the availability of S/4HANA Public Cloud Scopes Items meeting the customer’s needs. The DDA consists of 4 to 6 hours of workshops on an online tool provided by SAP. It is carried out by SAP and/or the integrator partner, and requires the participation of the customer’s Key Users.

Our recommendation is to align as far as possible with SAP’s strategy, and to consider SAP S/4HANA Public Cloud as a first approach. This is particularly true for new SAP customers. At the end of a Digital Discovery Assessment phase, if functional suitability is not assured, then an SAP S/4HANA Private Cloud scenario should be considered. This will be the case in particular for long-standing SAP ECC6 customers who are planning to migrate to SAP S/4HANA and wish to retain an ERP solution that is strongly adapted to their business needs, often with many specific Abap applications that need to be migrated. The ability of the business to adopt a new solution, rather than demanding that the ERP be adapted to their business processes, is also a key criterion in guiding the choice. SAP S/4HANA Public Cloud is preferable for customers who already have a strong culture of SaaS solution use, and know how to adopt solutions rather than adapt them.

For the time being, it’s still possible to opt for an On Premise version of SAP S/4HANA, especially for long-standing SAP customers already using SAP ECC6 (new customers are obliged to consider SAP’s Cloud offerings).

We do not recommend this choice, as it runs counter to SAP’s strategy and exposes customers to the risk of becoming second-rate customers, not a priority for SAP and its partners.

Furthermore, SAP is accelerating its efforts to “kill” the On Premise model as quickly as possible: 

• Priority release of new functionalities on cloud versions
• Access to certain SAP cloud solutions reserved for RISE or GROW customers only. This is notably the case for Sustainability solutions such as SAP Green Ledger, SAP Sustainability Footprint Management, SAP Sustainability Control Tower or the SAP Joule AI suite.
• Annual increase in maintenance costs for On Premise versions of SAP S/4HANA and SAP ECC6. RISE and GROW subscriptions are also subject to annual revisions, but these are capped and significantly lower than what SAP charges for On Premise versions.

To date, SAP S/4HANA On Premise remains the only alternative for customers who do not wish to have their data hosted outside France or by American hyperscalers. This is the case for many private operators managing confidential data (military or other). In fact, the French government updated its Cloud doctrine on May 31, 2023, opening up access to cloud….. solutions on condition that, where sensitive data is concerned, these cloud solutions are hosted on a commercial cloud qualified SecNumCloud by the ANSSI and protected against all extra-Community regulations.

• More information on Cloud au center: la doctrine de l’État | numerique.gouv.fr
• Direct access to the updated doctrine on the use of cloud computing by the State (“cloud au center”): Légifrance – Droit national en vigueur – Circulaires et instructions – Actualisation de la doctrine d’utilisation de l’informatique en nuage par l’État (“cloud au center”) (legifrance.gouv.fr)

For the time being, SAP is not in a position to offer SAP /4HANA Private Cloud or Public Cloud hosted with a Sovereign Cloud operator, and has made the choice to wait for the emergence of a European Sovereign Cloud before integrating new hosting partners into its RISE offering. It is likely, however, that given the complex and highly political discussions that will take place between the various members of the European Union, such a European standard will not emerge for many years to come.

For concerned customers who still wish to benefit from outsourced hosting, we suggest considering OVHcloud’s SAP hosting offer, which meets ANSSI requirements. More information on the OVHcloud hosting offer for SAP. More information on the OVHcloud hosting offer for SAP