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‘RISE with SAP’ has been on the market for a few weeks now – a global customer program for intelligent enterprises in the cloud. Cloudy to serene, the Walldorf-based software group sees itself on the way towards a full-service provider for business transformation-as-a-service. SAP complements its core business of enterprise software with services and solutions for digital technologies. Partners and hyperscalers remain important for implementation and hosting.
‘RISE with SAP’ is designed to ease the transition from on-premise licenses to cloud subscriptions. Facing the S/4HANA tsunami, industry customers are asking themselves: Is on-premise (formerly ‘Any’) with some control and adaptation or private cloud (formerly ‘Extended’) with client-specific hosting applications the future? After moving to the cloud, is there a way back to on-premise?
For SAP industry customers, individual applications and processes are key for success – not compatible with public cloud or software-as-a-service. Even medium-sized companies cannot get by with systems that are too rigid. Larger companies, especially in manufacturing and life sciences, operate highly customized or proprietary systems and third-party system integrations that are technically valuable and differentiating in the market. Very few large SAP customers could live with the public cloud – at best for small subsidiaries or business areas with a small degree of production, but not comprehensively in the typical manufacturing environment.
Exit still possible
Regarding the exit strategy: The software based on S/4HANA has not really differentiated between on-premise or cloud so far; in the future, the support priority by SAP will move from on-premise to the cloud. In purely technical terms, lift & shift between both worlds remains possible. It may be more complex if the source and target systems differ on the way back from cloud to on-premise, or if parts of the company use different systems. In this case, technical data migration or restructuring is recommended.
The private cloud delivers customer-specific applications with comprehensive functionality and flexibility, as previously on-premise – for industrial customers an option as future platform after ERP and ECC. At second glance, hosting and support for specific on-premise solutions in a provider’s cloud is not entirely new. Many companies are moving this direction anyway with hyperscalers. They buy software from SAP – in the future also technical implementation and potentially hosting and service as integrated contract components. They do business transformation with partners who provide process know-how and industry expertise. In this way S/4HANA Private Cloud will be palatable in the industrial environment, but the promise of cost savings remains to be unseen.
The SAP idea for a comprehensive approach is coherent, but pragmatic and rapid implementation must not be lost sight of. If you subtract hosting in the cloud and SAP software from ‘RISE with SAP’, you are still left with holistic business transformation – SAP does not deliver this on its own, the technical view is only one aspect. Complete business transformation needs the integration of business processes. The Walldorf-based company paves the way for the bigger picture – processes, applications, business models – and underpins the success factors from practice: the combination of consulting, transformation and global delivery. Thus, holistic business transformation is very close to cbs’ experience in designing enterprise-wide business processes – as a strong partner of SAP and independent consultant for industrial customers.
Business transformation as playing field for consulting expertise
While SAP also delivers consulting projects, the large number of consultants that are needed for the many S/4HANA transformations of the next few years will not come from Walldorf. SAP itself emphasizes the interaction of various partners, creating an expectation among industrial companies for complementary consulting services.
For industrial customers of cbs, the move to the ‘RISE with SAP’ program is not a technical migration, but a strategic transformation that – with providers such as Signavio or Celonis – calls for an examination of specialist requirements and a holistic view of the process and system landscape. For the entry into the cloud, it is important to test scenarios in advance and to examine business cases. At cbs, simplifying global process and system landscapes for SAP industrial customers and lifting them into the cloud is part of everyday life – not as a decade-long task, but as a fast and smart transformation to a digital platform on S/4HANA for end-to-end business solutions based on SAP technologies.
Parallel to SAP’s launch, cbs, as a pioneer for S/4 in the industrial market, already has its first lighthouse project: cbs has completed the transformation from ERP on-premise to the S/4HANA private cloud for the steel company SPS Companies Inc. in the USA. Proven migration scenarios and selective transition have demonstrated to be a good starting point for the changeover: select data and relevant history, transform financials, establish Fiori Apps and new SAP general ledger and harmonize cost and profit center structures. At the turn of 2020/2021, the go-live of the productive system took place without interrupting business processes – a successful migration to S/4HANA private cloud as a reference for the future of ‘RISE with SAP’.