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Understand your S/4HANA deployment options

SAP deployment options can be confusing, particularly with name changes. Learn which SAP program is right for your company based on your organization's goals and needs.

SAP S/4HANA represents a significant step forward in the company’s flagship ERP product evolution. Its release is coinciding with SAP's stronger emphasis on cloud computing, leading many to mistakenly believe S/4HANA is a cloud-only product. While S/4HANA was designed with the cloud in mind, the product can accommodate multiple deployment options, including cloud, on-premises or hybrid environments.

However, the array of SAP deployment options can sometimes be mystifying. In addition, SAP frequently changes the terminology in their product portfolio and messaging. This article will refer to each flavor of S/4HANA by its current name and will also include some previous product names for clarification.

Here are the deployment options currently available for S/4HANA.

S/4HANA Cloud

S/4HANA Cloud is the SaaS option and was previously called S/4HANA Cloud Essentials Edition. Prior to that, it was known as Multi-Tenant Edition.

SAP created S/4HANA Cloud as a simple and standardized option for companies that prefer a cloud-focused ERP strategy. SAP hosts and manages the cloud platform and automatically installs upgrades, which are not optional. Functionality is limited to a subset of core ERP features, with industry software and operations capabilities available for 42 countries.

The most common use cases for S/4HANA Cloud are new SAP users or subsidiaries of larger enterprises that run on SAP. S/4HANA Cloud is limited to new greenfield implementations, so companies performing a direct migration from an older SAP instance should look for another option.

S/4HANA Cloud Extended Edition

S/4HANA Cloud Extended Edition (EX), previously known as Single Tenant Edition, provides additional hosting options. Configuration and upgrade timing are more flexible.

While S/4HANA was designed with the cloud in mind, the product can accommodate multiple deployment options, including cloud, on-premises or hybrid environments.

As the product's previous name suggests, S/4HANA EX is based on a single-tenancy model, so users have much greater control over various aspects of their SAP environment, including third-party integrations. User interface options are more widely available. The Extended Edition also provides a broader features collection, so users have access to the full range of functionality found in SAP's on-premise S/4HANA ERP software.

Users who choose EX must pay for a minimum user count. The count is based on a formula that applies weighted values to various user types and calculates a full user equivalent. S/4HANA EX's minimum user count requirement as well as its increased cost and complexity makes the product most appropriate for midsize and large enterprises.

Like the baseline S/4HANA Cloud product, the Extended Edition is only suited for greenfield implementations.

S/4HANA Cloud Private Edition

S/4HANA Cloud Private Edition is new in 2021. This edition builds upon EX and is more flexible. Users can make modifications and apply upgrades at their own pace.

Many of the distinctions between S/4HANA EX and Private Edition boil down to technical flexibility. For example, Private Edition allows the use of partner templates, which make it easier and more efficient to build out an environment based on third-party intellectual property.

Private Edition users can also carry out a system conversion or selective data transition from a pre-existing SAP environment. Because of that, many users migrating to S/4HANA in the cloud will likely select Private Edition.

S/4HANA Any Premise managed by SAP on HANA Enterprise Cloud (HEC)

S/4HANA Any Premise managed by SAP on HANA Enterprise Cloud (HEC) combines the SAP's flagship ERP product with the HANA Enterprise Cloud and SAP managed services for private cloud. HEC is an infrastructure as a service offering that simplifies a complete SAP landscape's deployment and management. The process is simplified regardless of where it's hosted.

As Any Premise suggests, HEC users can deploy S/4HANA on their own hardware within their own data center or within an SAP-operated data center. They can also select a hyperscaler cloud provider such as Google, Amazon or Microsoft.

SAP handles the environment management no matter the location. Users receive additional SAP upgrades flexibility as well as partner templates use and maximum extensibility.

S/4HANA Any Premise managed by the user or third party

S/4HANA Any Premise managed by the user or third party is similar to Any Premise on HEC. However, with this option, the user is responsible for environment management. They can do it themselves or delegate it to a third party.

The user can host their SAP environment within their own data center or at a cloud hyperscaler. Current options include Google Cloud Platform, Amazon Web Services, Microsoft Azure, IBM Cloud, Alibaba, Huawei and Open Telekom Cloud.

Users should look at the size, complexity and functional scope of their planned S/4HANA environment as they decide which deployment option is right for them.

They should also think about the nature of their SAP implementation. Any of these deployment options will work for greenfield projects, but companies upgrading from an older SAP environment should consider options like Private Edition and HEC.

Organizations that can make do with limited flexibility in exchange for comparatively simple implementation and management should choose S/4HANA Cloud and S/4HANA Cloud EX. Meanwhile, larger enterprises with more complex functional requirements will likely gravitate toward Private Edition and HEC.

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