Two Tier ERP and which SAP S/4HANA Cloud?
SAP promote the use of both their private cloud and public cloud services as part of their their S/4HANA SaaS solutions in a two-tier ERP. This article looks at the background.
As more companies migrate/re-implement their ERP to S/4HANA, they will consider the pros and cons of a “brownfield lift and shift migration” compared to “re-implementing a new greenfield” system.
However, SAP S/4HANA Public Cloud Edition is the web version and does not support brownfield migrations or extensive customisation, so both these needs require a private cloud option. SAP S/4HANA Private Cloud Edition service will be required for any organisations that have high complexity needs (such as manufacturing or pharmaceuticals) and want an SAP SaaS service.
S/4HANA Cloud now has two variants:
- SAP S/4HANA Private Cloud Edition (which was the single-tenant on HEC)
- SAP S/4HANA Public Cloud Edition (which is the Web based, multi-tenant version)
"SAP HANA Enterprise Cloud, customer edition” was launched last year as SAP's private hybrid cloud IaaS. This was recently renamed to “SAP S/4HANA Cloud, private edition, customer data center option” which is the new name of SAP S/4HANA Private Cloud hybrid SaaS offering.
First a bit of background on HEC and SAP S/4HANA Cloud:
SAP HANA Enterprise Cloud (HEC)
HEC was SAP’s original private cloud service named SAP HANA Enterprise Cloud (HEC) which was launched in 2013 and consisted of SAP providing the cloud infrastructure with certain applications offered as a cloud service. HEC was effectively an 'Infrastructure as a Service' (IaaS) with some low-level software, that enabled companies to run SAP based operations in a hosted environment with the advantages of being on cloud.
SAP's HEC originally hosted in SAP’s own data centres and was not available in the UK.
In 2017 HEC was made available on both Amazon Web Services (AWS) & Microsoft Azure public clouds and later in 2019, HEC also became available on Google Cloud Platform (GCP).
However, as HEC is now positioned as SAP’s “private cloud offering”, I’m not sure how popular a private cloud offering on a public cloud will be.
SAP S/4HANA Cloud
In 2017, SAP launched their SAP S/4HANA Cloud which is a SaaS version of the SAP S/4HANA ERP, a suite of integrated business applications. This is also referred to as "SAP S/4HANA Public Cloud" and marketed as an ‘Intelligent Cloud ERP’.
SAP S/4HANA Cloud includes three key technologies that form the foundation of what they call the intelligent ERP:
1. Digital assistant. SAP S/4HANA Cloud uses SAP CoPilot, virtual assistant
2. Machine learning. SAP S/4HANA Cloud automates repetitive and error prone tasks.
3. Predictive analytics. SAP S/4HANA Cloud has embedded analytics to predict the outcomes of certain actions.
SAP S/4HANA Cloud has seen some big-name early adopters publicised as using the service but has also faced some criticism about its lack of customisation, especially in complex industries like manufacturing or pharmaceuticals. Note as SAP essentially controls the basic infrastructure of this Web only SaaS, it does not allow for extensive customisation. S/4HANA Cloud was not seen as being suitable for larger enterprises that need their ERP systems to be highly configurable to meet their needs. This contributed to the need and creation of their 'industry cloud' and the two tier ERP model.
Originally named, “Multi-Tenant Edition” the web-based service became known as “Cloud essentials edition (ES)” was S/4HANA SaaS service. This is now marketed as “SAP S/4HANA Public Cloud Edition”
The originally named, “Single-Tenant Edition” became known as “Cloud Extended edition (EX)” and is the SaaS private/hybrid cloud service that is now marketed for “SAP S/4HANA Private Cloud Edition." The hybrid version (that also includes infrastructure on-prem, managed by SAP as part of the service) has changed names from "HEC customer edition" to a new name of "SAP S/4HANA Cloud, private edition, customer data center option." The renaming of an infrastructure service being replaced with a SaaS brand name reflects the rolling up of infrastructure services within the SaaS offering.
The reason for all these name changes is to help align SAP’s SaaS solutions with the appropriate solution for different customer needs. Revisiting my opening comments, SAP S/4HANA public cloud version, does not support brownfield migrations or extensive customisation. Therefore, both of these requirements must be delivered by SAP S/4HANA private cloud service.
SAP are now marketing both of these solutions as part of their two-tier ERP which recommends the more complex private cloud service for the HQ and the Web based public cloud service to subsidiaries.
References
Two-Tier ERP with SAP S/4HANA Cloud and deployment possibilities
Information Technology Senior Manager
3yOf course depending on the customers' varying scenarios combinations of the two options could be opted, but this will bring additional infrastructure complexity. Often times especially for customizing intensive cases saas,private and on prem landscape s will bring operational complexity