Cloud First or S/4 Hana - on cloud nine or devastated? Every SAP customer knows by now that cloud computing is not more cost-efficient than good old on prem. What to do with S/4, then?

Many SAP customers are having a hard time deciding between cloud computing and their own on prem datacenters concerning S/4 and Hana – and there’s a good reason for that. Many organizational, technological, business and licensing aspects have to be taken into account.

No SAP customer migrates to the cloud simply because it’s more cost-efficient. ERP systems have become way too complex to only focus on the money saved.

Implementing SAP systems is no picnic, and a release change is more adventure than vacation. If customers decide on S/4 and Hana, it’ll seem like they only decided on a new ERP system and database. However, the release change entails so much more.

What SAP isn’t talking about

There’s a number of things that SAP would never dare to say, but every customer knows they are true nonetheless.







For example, AnyDB, meaning Oracle, IBM DB2, Microsoft SQL servers and more, was and is only a filing system for storing ERP system data in R/3 and ERP/ECC 6.0. Oracle, IBM and Microsoft can do so much more – but they were never allowed to show off their skills in the SAP environment.

Hana is a highly complex and efficient database platform with numerous engines and processes. Leveraging its real-time capabilities, SAP customers will transition from IT stone age into the future.

However, with Hana comes ambivalence. On the one hand, large Hana databases could need several days to reboot after crashing, posing a risk to business success. On the other hand, data scientists are ecstatic about its real-time data analysis.

SAP pushed its in-memory database Hana out into the market way too soon. And the ERP company seems to have realized that, too. Every year at Sapphire Now, Hasso Plattner comes out on stage to defend his invention and highlight new technological advances to make it all look more presentable. This year, he was showing off Intel Persistent Memory.

Admittedly, Persistent Memory seems to be able to solve one of Hana’s gravest problems: it can reduce the database’s reboot time to mere minutes!

Unfinished S/4 and Hana construction sites

While this is a major step forward, there are still other unfinished Hana construction sites. Hana 1, Hana 2 and numerous version updates are just the tip of the iceberg.

Not the migration to S/4 or Hana per se is the problem, but everything that has to come before it. SAP customers have to evaluate which Hana version they can, should or must migrate to.

The technological aspect of release changes is not a problem anymore, but what if the SAP banking app has to be customized, for example? Banking is only available on Hana 1, and Hana 1 is only available on HP’s expensive Superdome and antiquated Hana appliances.

S/4 Hana on prem or in the cloud? SAP CEO Bill McDermott doesn’t even hesitate to answer with his mantra “Cloud First”!

A major retail company serves as an example why some customers might consider this a viable option. The CIO of said retail company invested a lot of time and money in their on prem IT environment. Hana started operating and crashed not long after.

Good news: the system wasn’t used in productive operation yet. Bad news: it took them a week to reboot Hana.

The retail company’s CIO now knows that if they ever decide to use Hana again, they will operate it in SAP’s own cloud – so that SAP has to take responsibility for the mess Hana sometimes makes.

Usually very confident in his cloud strategy, Bill McDermott wavered when he presented SAP’s program Embrace to court and praise hyperscalers AWS, Google and Microsoft.

SAP customers have to ask themselves where to operate S/4 and Hana: in their on prem datacenters, in SAP’s cloud, or in third-party clouds? Not only market-leading hyperscalers have nice Hana offers, making it even harder to decide as third-party offerings abound.

Torn-apart SAP community

Many SAP customers have had enough of the dichotomy between SAP on prem and in the cloud.

After years of successfully working together on R/3 implementations with a customer, SAP ensures great on prem support for ERP/ECC 6.0 and seamless communication between customer, user group and SAP.

After years of successfully working together on R/3 implementations with SAP, many customers experience the exact opposite when they decide on SAP’s cloud offer. Individuality is not welcome in the cloud! Cloud standardization makes migration projects even harder for customers. SAP contacts and experts for modification are scarce and hard to come by.

User groups are downright ignored when it comes to cloud and integration topics. A broad discussion regarding cloud integration and hybrid cloud becomes impossible.

If SAP doesn’t fix this dichotomy, many customers will hide in their own datacenters from the nightmare that is SAP cloud computing.