RISE with SAP vs. S/4HANA Cloud: Which One Should You Choose?

In today’s time, digital transformation is no longer a choice but a necessity for survival. Businesses have witnessed unforeseen challenges in the last few years that have left many unprepared, pushing them to reconsider their digital transformation initiatives proactively. SAP, a leader in enterprise software, has recognized the need to help organizations adapt to these uncertain times, and two of its offerings, RISE with SAP and S/4HANA Cloud, have taken center stage.

This blog will explore these solutions, their differences, and how to choose the right one for your business.

Businesses relying on traditional SAP ERP solutions are aware of the impending end of maintenance for Business Suite 7 by 2027. This significant milestone signals the need for modernization and a shift to more adaptable solutions.

SAP is encouraging users to embrace the cloud and its subscription service, RISE with SAP, as part of their transition to S/4HANA. However, there’s often confusion regarding the differences between RISE with SAP and SAP’s S/4HANA. Both offerings play crucial roles in SAP’s strategy, and companies can choose to have both.

RISE with SAP represents a shift from traditional ERP functionality towards an ERP-as-a-service model. It includes the S/4HANA Cloud ERP, partner-provided migration and implementation services, access to the SAP Business Network, and intelligent business process reengineering. It is offered on SAP’s cloud platform, or a hyperscaler like AWS or Google can host it. One of its key selling points is its “single contract,” providing an all-in-one solution.

SAP has launched RISE with SAP to modernize ERP and foster innovation to meet the demands of the digital era. ERP systems, including SAP’s own offerings, have played a pivotal role in business operations for over three decades. Originally embraced by large enterprises, ERP solutions are now utilized by organizations across various industries. However, the paradigms and structures that have long underpinned ERP systems may no longer be suitable for the fast-paced digital landscape.

Digital Transformation: Today’s world is characterized by globalization, advanced supply chains, widespread mobile computing, a mature internet, seamless integration standards, artificial intelligence (AI), big data, in-memory computing, and cloud computing. ERP systems must evolve to embrace these technological advancements and adapt to the contemporary business landscape.

Accelerated Innovation: Globalization, venture capital support for digital startups, rapid technological progress, the global pandemic, sustainability concerns, increasing regulatory requirements, and generational shifts in the workforce have significantly accelerated the demand for innovation. Businesses now require ERP solutions to keep pace with these changes and support agility and adaptability.

Addressing Supply Chain Vulnerabilities: The global pandemic, especially the widespread adoption of remote work (WFH), exposed vulnerabilities in supply chains. Modern ERP systems, as exemplified by RISE with SAP, are designed to enhance supply chain resilience and responsiveness.

There are several benefits of RISE with SAP as it addresses the need for a more agile, innovative, and adaptable ERP solution that aligns with the current digital landscape. It aims to help businesses navigate the challenges and opportunities the rapidly evolving global business environment presents.

RISE with SAP bundles various products and services to provide a unified experience, with S/4HANA Cloud being a central component. Within RISE with SAP, you’ll find SAP’s S/4HANA Cloud ERP alongside migration and implementation services provided by SAP partners. The Rise with SAP offering also grants access to the SAP Business Network, incorporating Ariba, and features intelligent business process reengineering, bolstered by SAP’s newly acquired process-mining capabilities. A prominent advantage of RISE is its “single contract” approach, presenting itself as an all-inclusive solution encompassing software, services, and infrastructure in one convenient package.

SAP

SAP S/4HANA is a next-generation enterprise resource planning (ERP) system that runs on the SAP HANA in-memory database. SAP S/4HANA is basically a comprehensive suite of business applications that can manage all business aspects, including finance, accounting, sales, marketing, manufacturing, and customer service.

SAP S/4HANA is deployable in a variety of ways, including:

• SAP S/4HANA Cloud: This cloud-based solution is hosted and managed by SAP. It is a good option for businesses that want a quick and easy way to deploy SAP S/4HANA or that do not have the resources to manage an on-premise solution.

• SAP S/4HANA Cloud Extended Edition: This is a more flexible cloud-based solution that gives businesses more control over their deployment. For example, businesses can host their own SAP S/4HANA Cloud extended edition environment or use a managed service provider.

• SAP S/4HANA Cloud Private Edition: This cloud-based solution is dedicated to a single customer. It is a good option for businesses with strict security or compliance requirements. The 2023 version of SAP S/4HANA Cloud, the private edition, goes beyond merely offering the full capabilities of SAP ERP Central Component. It unifies finance, manufacturing, operations, and supplier management within a single cloud platform, integrating them seamlessly with the latest architectural framework for line-of-business applications.

Furthermore, as an integral component of RISE with SAP, the private edition of SAP S/4HANA Cloud has transitioned to a two-year release cycle, introducing user-friendly innovations and enhancements approximately every six months. Additionally, the maintenance support period has been extended from five to seven years, providing customers with an extended window of value from their investment.

• SAP S/4HANA On-Premise Managed by SAP (HEC): This is an on-premise solution that is hosted and managed by SAP. It is a good option for businesses that need a high level of control over their deployment or that have specific on-premise requirements. SAP S/4HANA Any-Premise: This is an on-premise solution that can be hosted by the customer or by a managed service provider. It is a good option for businesses that need a high level of control over their deployment, but that do not have the resources to manage an on-premise solution themselves.

SAP S/4HANA is not directly competing with RISE with SAP; rather, it constitutes a central component of the RISE bundle. Users can utilize S/4HANA as a standalone solution and can select between a public cloud or a private cloud environment, allowing them greater control over their deployment.

RISE with SAP focuses less on the fundamental ERP features and more on delivering ERP as a comprehensive service package enriched with supplementary offerings to enhance its value.

There’s a common misconception that RISE with SAP is only for SAP beginners, but it serves a broader purpose. RISE extends the value of SAP beyond ERP functionality, offering access to a wide range of tools, services, and applications to elevate and modernize a business. RISE can be invaluable if your goal is full-scale modernization and transformation of applications, processes, workflows, and culture.

RISE with SAP is a flexible solution catering to various business scenarios and needs. Here are some situations where businesses can opt for RISE with SAP:

Transition from SAP ECC 6.0 to SAP S/4HANA Cloud

For organizations currently using SAP ECC 6.0, the transition to SAP S/4HANA Cloud is a significant step. RISE with SAP offers a suitable path for this migration, providing a comprehensive solution that includes migration services. This ensures a smoother transition, minimizing disruptions to ongoing operations. The flexibility of RISE with SAP allows these organizations to make this transition at their own pace, considering their unique business requirements and timeline.

Shift from SAP S/4HANA On-Premises to the Cloud

Existing SAP S/4HANA On-Premises clients looking to embrace the benefits of a cloud-based environment can find RISE with SAP appealing. This offering provides an all-inclusive package that simplifies the migration to the cloud, eliminating the complexities associated with infrastructure and deployment. The flexibility in deployment options allows organizations to choose the infrastructure in the cloud that best suits their unique needs, whether public, private, or hybrid.

New Businesses Adopting SAP ERP

Organizations new to SAP ERP who aim to harness the capabilities of the industry’s leading ERP solution can benefit from RISE with SAP. It offers a streamlined approach for newcomers by providing an all-in-one solution that includes not only the ERP software but also migration services, cloud infrastructure, and ongoing support. This simplifies the onboarding process for new users, enabling them to quickly leverage SAP’s capabilities to enhance their business operations.

All-Inclusive Solution for Simplified Adoption

RISE with SAP is an attractive choice for organizations seeking an all-inclusive solution. This is particularly advantageous for those looking to simplify the adoption and management of SAP S/4HANA. The comprehensive package ensures that businesses have access to the essential components required for a successful transition, which includes migration services, infrastructure provision, and ongoing support. Additionally, organizations that want to leverage SAP’s partner network, the SAP Business Network, and process-mining capabilities may find RISE with SAP more appealing.

On the other hand, if you primarily aim to migrate your current SAP systems to the Cloud, starting with S/4HANA Cloud may be the preferred route. The choice ultimately depends on your business’s needs, strategy, and budget. The decision should be based on the organization’s specific needs and strategic goals, as well as budget considerations.

The transition to a SaaS (Software as a Service) model represents a fundamental shift in how SAP structures its payment and pricing strategies. The transition to a SaaS model by SAP represents a more modern, agile, and predictable approach to software acquisition and usage. It offers customers greater flexibility, enhanced access to ongoing improvements and simplifies the management of software-related costs. However, businesses must adapt to this subscription-based structure, which may require reevaluating budgeting strategies and IT financial planning.

Nsight can assist in evaluating your current SAP capabilities, aligning them with your business goals, and determining the right steps to take. Whether you opt for RISE with SAP, S/4HANA Cloud, or other SAP solutions, Nsight offers SAP expertise, strategic guidance, and operational support to maximize the benefits of your investment.

In a rapidly changing business landscape, it is important to embrace digital transformation and choose the SAP solution that best suits your unique needs and ambitions.

SAP is quite keen to provide their customers with help in this regard. They provide an SAP Rapid Deployment software solution specifically to allow a fast and efficient migration to both the SAP HANA database and SAP S/4HANA Finance. Such preconfigured packages are supplied by SAP and sometimes allow fixed-pricing deployments.

RISE with SAP is preferred when transitioning from SAP ECC 6.0 to S/4HANA Cloud, moving from SAP S/4HANA On-Premises to the cloud, or adopting SAP ERP for the first time. It simplifies digital transformation by offering a comprehensive, all-in-one solution, streamlining the transition process.

Naturally, integration providers strive to offer speedy and efficient implementation options. SAP service partners have extensive expertise in the implementation of the SAP Business Suite and, now, SAP S/4HANA. More than 60% of deployment operations are carried out by partners and integration partners rather than SAP.

RISE with SAP is preferred when transitioning from SAP ECC 6.0 to S/4HANA Cloud, moving from SAP S/4HANA On-Premises to the cloud, or adopting SAP ERP for the first time. It simplifies digital transformation by offering a comprehensive, all-in-one solution, streamlining the transition process.

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About the Author

Sunil Varanasi, SAP & CX Practice Head at Nsight Inc., brings 23 years of experience in Technology, Digitization, and End-to-End ERP services, specializing in S/4HANA Cloud. He has worked globally, contributing to implementations, rollouts, and upgradation projects with a focus on Template Development, Design, Architecture, Business Process Analysis, and more. Sunil excels in a multicultural environment, collaborating with leading consulting companies and clients worldwide.