Issue

As ERP Rebuild evaluates its functional deployment for future state SAP S/4HANA, the decision between utilising a public cloud or a private cloud environment, on which to build business capability, is a critical consideration. This document (when completed post reviews) will provide a clear concise comparison of the primary options to inform this decision. 

Recommendation

Option A) SAP S/4HANA Private Cloud Edition

SAP S/4HANA Public Cloud, with its benefits of low touch maintenance and standardised business processes, presents a simple and straightforward solution. However, for a global chemicals company like Syensqo, the realities of running a scaled operation with multinational compliance obligations  and potential for future acquisition/divestments challenge the viability of this option in it's current offering from SAP. While SAP S/4HANA Public Cloud offers cost efficiency, the need for enhanced security, additional compliance, and control over Syensqo data favours the SAP S/4HANA Private Cloud Edition. Additionally, SAP S/4HANA Private Cloud Edition provides flexibility in project deployment options, allows Syensqo to determine its own schedule for maintenance and adoption of new technologies and business capabilities (such as generative AI), that are rapidly emerging and will advance during the lifecycle of the ERP Rebuild. Changing position on capabilities through deployment lifecycle is a likely scenario that is not supported under the constrains of SAP S/4HANA Public Cloud.

Finally, SAP S/4HANA Public Cloud is generally used for new greenfield deployments, especially for emerging companies without significant standing investments in SAP solutions. Given Syensqo's extensive implementation of SAP dating back to 2001, transitioning to SAP S/4HANA Public Cloud is not feasible. Our existing infrastructure and substantial investments in on-premises SAP solutions necessitate a tailored approach that ensures advancement in business capability that leverages on existing deployed assets and Syensqo IP. 

Background & Context

In recent years SAP has been marketing and constructing it's product offerings towards cloud subscription models in order to become a 'Cloud' company. For SAP/S/4 core systems the product offerings are including SAP S/4HANA Public Cloud, GROW with SAP, SAP RISE and Private Cloud Edition each of these options offer varied configurations of which customers may consider. Broadly speaking (and in order to refine the conversation for decision making) these models are either public or private options thus this KDD is narrowed down to option A) SAP S/4HANA Private Cloud Edition or option B) SAP S/4HANA Public Cloud. For the purpose of this KDD Private cloud edition can be also considered as an SAP RISE construct, however SAP RISE or Private Cloud will have it's own consideration with it's own pro's and con's as SAP licensing negotiation commences and as ERP Rebuild aligns on it's understanding and it's requirements on how it aims to operate SAP more fully. 

Assumptions

1) No on-premise data center
Building on-premise data center with a perpetual license model is out of the question due to there being no indicators that this would be a preference and ERP Rebuild charter alignment and Syensqo goals means building a modern future proof solution which aligns with cloud. It is such an obvious elimination of choice that it not sensible to take effort to validate this assumption.

2) Requirement to support intentional but disruptive events
As commonly indicated by executive leadership, Syensqo will at some point undergo mergers/acquisitions/divestments in it's future, possibly even during the ERP Rebuild project lifecycle. These events will have demands and requirements to integrate or onboard / off-board organisational units with speed and flexibility. 

3) No product deviation from SAP
SAP do not alter their product offerings so significantly in the time period between this decision and securing a license to operate that the recommendation becomes invalid.

4) Uptime and Problem Resolution
SLA's for availability and support offered through products considered meet Syensqo's requirements

5) Cost Control and Vendor Lock-in
Ensuring the power dynamic does not shift heavily in SAP's favour while transitioning to a cloud subscription model is a critical non-functional requirement

Constraints

Impacts

Business Rules

Options considered

Option A: SAP S/4HANA Public Cloud

Option B: SAP S/4HANA Private Cloud Edition

Option C: 

Option D: 

Evaluation

	Option A -SAP Public Cloud	Option B - SAP Private Cloud
Ownership and Control	Con You do not own or control the underlying solution, relying on SAP for maintenance and update on their own schedule	Pro You have control over the solution with a dedicated cloud provider.
Security and Compliance	Con Security and compliance are primarily the responsibility of the cloud provider.	Pro Syensqo have greater control over implementing our own security measures and compliance policies to suit international regulations.
Scalability and Performance	Pro	Con
Customisation and Integration
Deployment
Management
Customisation
Updates
Cost
Integration
Data Residency
Vendor Lock-in
Performance

See also

Change log

Workflow history