In late January, SAP became one of the latest businesses to shift to a subscription model with the introduction of RISE with SAP—a business transformation as a service offer. Details about RISE with SAP remain scarce, but here is what we know so far:
- RISE with SAP is a new offer that bundles licensing, maintenance and hosting for SAP’s ERP applications into a single contract, fee and SL
- The services bundle contains the customer’s choice of hosting app, such as ECC BSoH or SAP S/4HANA, as well as app management services
- All services are guaranteed by SAP
At first glance, RISE with SAP appears to offer organizations new levels of flexibility and customization. Clients can use any version of SAP (including their current application, SAP on cloud as a single tenant or SAP on a multi-tenant cloud); they can also select the cloud platform of their choice from SAP or a hyperscaler. SAP CEO Christian Klein estimates that RISE with SAP could reduce total cost of ownership by 20 percent.
Promising as that may sound, the announcement has left clients with many questions, most notably around what specifically is in the bundle. Is RISE with SAP a repackaging of existing services or is it a truly new offer? If it is a repackaging, then what benefits will the organization reap for using RISE with SAP as compared to procuring the same services on their own? Which SIs will be providing the services?
As of now, there is fairly little information available to answer those questions—which may give some CIOs the false impression that they will need to “wait and see” before moving ahead with their transformation agenda.
We would argue that organizations should not get stuck playing that waiting game. While RISE with SAP is being presented as a game changer by some, the details are too scarce to know for sure.
Is RISE with SAP a good fit for my organization?
Our interpretation of the available information—which, again, is limited—suggests that an organization’s decision to adopt RISE with SAP may depend on whether the business wants to prioritize simplicity and efficiency or flexibility and choice.
If your organization wants to streamline purchasing, then reducing the vendor ecosystem so that the software, cloud platform and managed services are coordinated by one vendor through a single contract might be a good choice. On the other hand, if your organization has a heterogenous IT strategy and values the flexibility and customization that comes from working with a variety of service providers, then it may make sense to continue to forge separate relationships.
3 takeaways from the RISE with SAP announcement
While organizations continue to evaluate how RISE with SAP could impact their migration strategy, the organization’s immediate next step depends on where they are in their transformation journey.
1. For organizations in the process of migrating to the cloud: Proceed as planned
RISE with SAP is a new development, but it should not fundamentally change the organization’s existing migration strategy. SAP’s acceptance of the hyperscale reality should give you confidence in your decision. There seems to be little cause to delay any aspect of the current agenda—even for those organizations pursuing a greenfield migration.
Bottom line: Organizations who chosen the cloud journey can be confident that SAP strategically supports that decision.
2. For organizations that are still determining their cloud migration strategy: Begin the process with an assessment
The shift to the cloud requires mapping and strategizing well before configuration takes place. This process is what we call “the discovery phase”. During this period, the business considers every aspect of the transformation, which includes technical considerations as well as other business issues, such as documentation, security and compliance. It can be an extremely time-consuming process in that the organization must pore over all existing assets and processes and determine if and how they should be migrated to the cloud.
The discovery and assessment capabilities of Protera Arion® can help organizations reduce the costs and complexity of an SAP cloud migration by automating some aspects of the discovery process. To learn more about the importance of the planning and discovery phase and how Protera can help simplify the process, please review our recent blog: Why “as-is” SAP cloud migration can be more complex than expected.
3. For those organizations that do not have a cloud strategy: Now is a good time to reconsider all options, including SAP S/4HANA
The cloud provides businesses with a tremendous opportunity to improve agility, reduce costs and achieve operational excellence. Understanding the benefits of a cloud environment is a requirement for almost every organization. Most businesses who do not yet have a migration strategy are beginning to put one in place.
With the announcement of Rise with SAP, organizations should work with an SAP certified partner to understand their new options. The traditional process for a cloud migration can take up to one year to complete. But organizations who take advantage of automation and analytics tools like Protera Arion® can cut this timeline in half.
Final thoughts: Watch this space for more details on RISE with SAP
Given the lack of detail around SAP’s announcement, it is simply too early for most CIOs to make an informed decision about how RISE with SAP could help their business.
On one hand, SAP is offering cloud and service options that weren’t previously available. On the other, it is still very unclear what is contained in the bundle and what organizations will provide services. For companies that are comfortable putting more purchasing behind SAP, this solution could be a valuable opportunity to simplify some aspects of the cloud migration process. Engaging SAP directly, as opposed to managing contracts with a wider supplier network, could also be a source of cost savings. Finally, for organizations that have recently purchased software from SAP, it may be possible to negotiate a credit or special pricing if the company also invests in RISE with SAP.
While details are scarce at the moment, we are following developments closely and will share more information about what this offer means for our clients as it becomes available. In the meantime, we encourage you to continue moving ahead with your cloud migration strategy—and welcome you to reach out to learn how Protera can help simplify and expedite the process.
What are your thoughts on RISE with SAP and what it means for your business? Respond here and stay tuned for more discussions on the topic.