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To understand whether S/4HANA Cloud extended edition offers the right balance of control and ease, it's important to start with an overview of this ERP system.
Although SAP has been urging its users to migrate to the cloud, it offers cloud, on-premises and hybrid deployment options for S/4HANA. Software flexibility and functionality varies among these. S/4HANA Cloud is the entry-level offering. It's designed for users with relatively simple needs and for subsidiaries of larger enterprises that are running SAP systems. The S/4HANA Cloud extended edition (EX) is one step up in terms of cost, complexity and flexibility.
SAP frequently changes its product offerings' nomenclature and, to that point, previously called S/4HANA Cloud EX the S/4HANA single-tenant edition. As its former name suggests, extended edition is offered on a dedicated cloud landscape.
What is S/4HANA Cloud extended edition (EX)?
S/4HANA Cloud EX offers much of the entry-level S/4HANA Cloud version's simplicity and standardization. However, S/4HANA users have much greater control over their SAP environment because the software offers more customization capabilities and third-party integrations.
The extended edition also has a wider range of user interface options and expanded functionality compared to the multi-tenant version. This comes with a cost, of course. SAP requires a higher user count for EX, and the software's increased complexity makes it more expensive to operate.
S/4HANA Cloud EX is appropriate for midsize and large enterprises that don't want to manage an IT infrastructure but want more options and flexibility than the entry-level version offers.
The extended edition provides the complete range of SAP features, including localization and best practices for 64 countries. It's available in 39 different languages and offers vertical functionality for 25 industries. By contrast, the multi-tenant S/4HANA Cloud ERP functionality is more limited.
Organizations can integrate S/4HANA Cloud EX with SAP SuccessFactors Employee Central, which handles HR; Fieldglass, which handles vendor management; Hybris, which handles e-commerce and CRM; and Ariba Network, which handles procurement and supply chain management.
One of the primary drawbacks of SAP's entry-level S/4HANA Cloud version is its limited customization and enhancement options. The extended edition offers a bit more flexibility but is still limited compared to the more complex "Any Premise" versions.
S/4HANA Cloud EX allows ABAP extensions, but modifications that alter SAP's existing functionality are not permitted. As with the basic Cloud version, developers can opt for side-by-side development and create cloud-based apps that run alongside S/4HANA. This approach is likely new for many veteran SAP programmers but can extend S/4HANA functionality to very good effect.
Power users can take advantage of the product's in-app extensibility features to create new fields and add business logic, among other functions.
Like the entry-level product, S/4HANA Cloud EX supports the use of partner-developed content, but partners must add those configurations manually.
Although some of the more complex S/4HANA configurations offer a perpetual license option, S/4HANA Cloud EX is available on a subscription basis only and is only available as a SaaS product.
Hosting and infrastructure management are included in S/4HANA Cloud EX's monthly fees, and companies usually sign up for multiyear contracts.
Who manages the environment?
S/4HANA Cloud EX users have a few new cloud platform options that aren't available for multi-tenant users. Although SAP manages the environment and it runs on the SAP Cloud Platform (SCP), one of the SAP-approved hyperscalers -- such as Microsoft Azure, AWS or the Google Cloud Platform -- may host the environment.
Unlike the multi-tenant version, the S/4HANA Cloud EX ERP option provides a dedicated environment, so organizations don't share with other users. However, the environment is still highly standardized. It offers a common set of infrastructure processes, services and service-level agreements for every user running this version of S/4HANA. Because of that standardization, S/4HANA Cloud EX users have less flexibility and fewer extensibility options than those using the more complex variations of SAP's latest ERP product.
Suitable implementation scenarios
S/4HANA Cloud is limited to new -- that is, greenfield -- implementations. Companies performing a direct migration from an older SAP version will need to select one of S/4HANA's higher-end versions. Users planning a move from SAP R/3 will need to implement a new system from scratch.
Many of SAP's existing users will likely be dissatisfied with the extended edition because it's built for standardization.
The upgrade process
S/4HANA Cloud EX's upgrades offer a bit more flexibility than the basic Cloud version. Upgrades occur twice a year, and users have some control over their timing. For many companies, this offers the best of both worlds: They get fast access to new innovations, but they can also postpone the potential disruptions associated with an upgrade process. Companies facing high-volume seasonal fluctuations or other events will likely value that flexibility.
S/4HANA Cloud EX use cases
S/4HANA Cloud EX is likely best for new SAP users who need a bit more flexibility and functionality than the multi-tenant S/4HANA Cloud version can provide, but who are still willing to embrace SAP's standard processes and best practices.
Extended edition users may be advised to rework their existing business processes to fit S/4HANA's recommended approach rather than tailoring the software. In this respect, EX offers a move away from S/4HANA Cloud's high degree of standardization.