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SAP S/4HANA Cloud and On-Premise Deployment Options

Last updated: May 29 2020

This blog targets SAP solution architects and explains the different deployment options for SAP S/4HANA. I have used the latest terminology. It covers cloud, on-premise and hosted deployment options. Here are the options discussed:

  1. SAP S/4HANA Cloud essentials edition (ES): previously called Multi-Tenant Edition.
  2. SAP S/4HANA Cloud extended edition (EX): previously called Single-Tenant Edition
  3. SAP S/4HANA AnyPremise Private Cloud managed by SAP (HEC)
  4. SAP S/4HANA AnyPremise: On-Premise or managed by cloud provider Hyperscalers

I cover the following aspects of each option: infrastructure, license, how upgrades are managed, scope (functional, country and industry), configuration, extensibility (how solution can be extended beyond configuration) and implementation (possible approaches).

I also cover which roadmap of the SAP Activate implementation methodology is relevant, what SAP Best Practices are used and what tools are relevant. See my other blog for an overview of SAP Best Practices and Model Companies.

1. SAP S/4HANA Cloud essentials edition (ES)

Commonly used by net new customers that want the full cloud approach with regular quarterly upgrades that include new configuration and new software. Also used for subsidiaries alongside SAP on-premise implementations.

  • Infrastructure: public cloud shared with other customers hosted only by SAP
  • License: subscription for Software as a Service
  • Upgrades: quarterly fixed and mandatory (configuration and software)
  • Scope: core ERP (subset of full ERP) and specific industries and 42 countries
  • Extensibility: Extensibility framework and extensions through SAP Cloud Platform with whitelisted APIs.
  • Configuration: use Self Service Configuration User Interfaces (SSCUIs) based on fit-to-standard workshops in the Explore phase
  • Implementation: greenfield only (new implementation)
  • SAP Activate roadmap: SAP Activate Methodology for SAP S/4HANA Cloud
  • SAP Best Practices: scope is selected from these cloud-specific Best Practices. https://rapid.sap.com/bp/#/BP_CLD_ENTPR
  • You can choose to use the Implementation Portal for SAP S/4HANA Cloud to manage your project. See: https://support.sap.com/en/alm/sap-cloud-alm/implementation-portal.html

Unlike all the other deployment options, the user interface is purely Fiori launchpad and configuration is done using SSCUIs and not the IMG.

 

2. SAP S/4HANA Cloud extended edition (EX)

Has advantages of the cloud with more flexibility and control. Has standardized infrastructure processes, services and SLAs. There is a minimum number of users.

  • Infrastructure: dedicated landscape on cloud infrastructure (SAP or Hyperscaler e.g. Microsoft Azure, AWS, Google Cloud)
  • License: subscription for Software as a Service
  • Upgrades: two per year with flexibility (software)
  • Scope: same S/4HANA functional scope as on-premise. 64 countries, 39, languages and 25 industries. Some third-party add-on limitations.
  • Extensibility: full extensibility but no modifications: includes Extensibility framework and extensions through SAP Cloud Platform. See SAP note 2920697.
  • Configuration: use the IMG based on fit-to-standard workshops in the Explore phase. Some restrictions apply e.g. SE80.
  • Implementation: greenfield (new implementation) or selective data transition
  • SAP Activate roadmap: SAP Activate Methodology for SAP S/4HANA Cloud EX
  • SAP Best Practices: SAP Best Practices and Model Companies are available. Mutli-national corporation is available for a production system while others are currently available for sandbox only. https://rapid.sap.com/bp/BP_OP_ENTPR
  • Customers use SAP Solution Manager to manage their project design.

Also see this blog on the 5 golden rules for extended edition (formerly single tenant edition). https://blogs.sap.com/2018/07/28/the-5-golden-rules-for-implementing-sap-s4hana-cloud-single-tenant-edition/

3. SAP S/4HANA AnyPremise Private Cloud managed by SAP (HEC)

An on-premise solution with individual and private hardware and infrastructure hosted by SAP or a hyperscaler. Hardware and infrastructure delegated to SAP with flexible service offerings.

  • Infrastructure: customer specific landscape on SAP HANA Enterprise Cloud (HEC) in SAP data centre or at a hyperscaler
  • License: Bring Your Own License and infrastructure subscription
  • Upgrades: annual and you choose your own speed of adoption (software)
  • Scope: full S/4HANA functional, country and industry scope and partner add-ons
  • Extensibility: customization, modification, and extensibility possible as with ERP
  • Configuration: use the full IMG based on a fit-to-standard approach in the Explore phase
  • Implementation: new implementation, system conversions or selective data transition
  • SAP Activate roadmap: Transition to SAP S/4HANA
  • SAP Best Practices: all SAP Best Practices and Model Companies are available. https://rapid.sap.com/bp/BP_OP_ENTPR
  • Customers use SAP Solution Manager to manage their project design. Most customers use SAP Best Practices activated using SAP Solution Builder or set up by SAP through a Model Company service.

The SAP Activate roadmap has 3 approaches: new implementation, system conversion or selective data transition. The term “selective data transition” is used instead of “landscape transformation” in the latest version of the roadmap. In this approach, there are tools to selectively transfer configuration and custom code from your old ERP system to a new SAP S/4HANA instance. System conversion involves converting your existing ERP system into SAP S/4HANA by migrating the database, applying software updates and doing a data conversion from the old data model to the new S/4HANA data model.

 

4. SAP S/4HANA Any Premise: On-Premise or managed by cloud providers Hyperscaler

On-premise SAP S/4HANA managed by the customer in their own data centre or managed by a third party.

  • Infrastructure: customer data centre or hosted by hyperscaler (e.g. e.g. Microsoft Azure, AWS, Google Cloud)
  • License: perpetual or Bring Your own License
  • Upgrades: annual and you choose your own speed of adoption (software)
  • Scope: full S/4HANA functional, country and industry scope and partner add-ons
  • Extensibility: customization, modification, and extensibility possible as with ERP
  • Configuration: use the full IMG based on a fit-to-standard approach in the Explore phase
  • Implementation: new implementation, system conversions or selective data transition
  • SAP Activate roadmap: Transition to SAP S/4HANA
  • SAP Best Practices: all SAP Best Practices and Model Companies are available for sandbox systems. https://rapid.sap.com/bp/BP_OP_ENTPR
  • Customers may use SAP Solution Manager to manage their project design. Many customers use SAP Best Practices activated using SAP Solution Builder or set up by SAP through a Model Company service.

What will influence your choice of deployment option? Organizations that are completely new to SAP will do a new “greenfield” implementation and can choose any option 1 to 4. What about if you are currently running the on-premise ERP Business Suite and want to move to S/4HANA?

  • The route selected by most customers is a “system conversion” where your existing system is converted to S/4HANA. This means option 3 or 4.
  • If you want to start again on a new page and do a “new implementation”, you can choose any deployment option. Note: option 1 may not cover all the processes and scope in your current solution.
  • The “selective data transition” approach allows you to take some of your existing solution into a new S/4HANA instance. Option 2,3 or 4 can be used.

See me related blog on moving to S/4HANA from ERP: https://blogs.sap.com/2019/10/30/how-to-move-to-sap-s4hana/.

When using the Transition to SAP S/4HANA SAP Activate roadmap, be sure to select the approach on the content screen.  See below.

 

 

I hope you found this blog informative.

Amin Hoque
Enterprise Architect at SAP Services UK

30 Comments
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  • Amin, I like the article but one thing concerns me presently in the area of Data Privacy.

    1809 Cloud Edition has 1J7 Best Practice describing the implementation of ILM-full or partial to support data privacy such as GDPR.

    However, 1809 Single Tenant Edition does not. Is this a documentation error or do we have an issue with full support for Data Privacy on Single Tenant?

     

    J1809

  • Hello David

    This is really out of my area of expertise, so I cannot provide a 100% answer.

    However, single tenant edition is like any other on-premise solution and can be managed to meet data privacy legislation in the same way as other SAP deployments.

    Cloud S/4HANA is the special case where a customer has less control and flexibility that in the other deployments. That is why Best Practice scope item 1J7 is provided to show how data privacy is met.

    Kind regards

    Amin Hoque

  • Thank you Amin for this excellent overview.

    I am slightly confused between Option 2 – S/4 HANA Cloud – Single Tenant and Option 4 – S/4 HANA On-Prem particularly if I am going to deploy it on public cloud infrastructure like AWS/Azure.

    Am I right to say that both are pretty much the same, but Option 2 is managed by SAP whilst Option 4 allows me to choose who to manage it (be it my own IT or outsource to a 3rd party AMS vendor)?

     

    Thank you

     

    • Hello Steven

      That is partially correct.

      Only SAP offers S/4HANA Cloud Single Tenant.  This is Software As a Service. The SAP Best Practices are always used.  SAP hosts and looks after things like the operating system, SAP software and upgrades.

      Partners like Azure, AWS and Google offer IAAS (Infrastructure As A Service). You might not use SAP Best Practices. They look after networking, storage, servers and virtualization.  The customer looks after the operating system up including upgrades.

      Cheers

      Amin

  • Hello Amin,

    Thank you for this really helpful article. I have a couple of questions.

    Can we perform a landscape transformation for SAP S/4 HANA Cloud Single Tenant Edition? And further, where will this be hosted (public cloud providers/SAP Cloud Platform)?

    For a transformation from SAP ECC 6.0 in Cloud to SAP S/4 HANA, what deployment model would be most suitable and feasible?

    Thank you!

     

     

    • Hello Simran

       

      “Landscape Transformation” is now called “Selective Data Transition”.

      You can move to SAP S/4HANA Cloud Single Tenant Edition with Selective Data Transition or a New Implementation.  You cannot do a system conversion.

      SAP S/4HANA Cloud Single Tenant Edition can be hosted by SAP or Hyperscalers.

      If you want to go to S/4HANA Cloud (previously called Multi Tenant Edition) the only option is a New Implementation.

      Kind regards

      Amin Hoque

    • SAP GUI is currently available in the S/4HANA Cloud extended edition (previously called STE).  There are long term plans to limit access to SE80 and move to purely browser based access.

  • Hello Amin,

    Can local (in-country) cloud providers provide the infrastructure services for options #2 and #4? If so, what are the requirements to be certified and provide these services?

    Regards

     

  • Hi Amin

    Really nice and helpful article. I have a couple of queries:

    1. Is it possible to have SAP S/4HANA Cloud extended edition (EX) on infrastructure provided by cloud hyperscalers like AWS, AZURE? In your article you have written it is possible. However as far as I have read, this is a SAAS provided only by SAP? Please confirm.

    2. Is it possible to have SAP S/4HANA Private Cloud managed by SAP (HEC) infrastructure provided by other hyperscalers like AWS, AZURE?

     

    Thanks

    Akhilesh

    • Hello Akhilesh

      1. Yes, SAP S/4HANA Cloud extended edition is available with infrastructure provided by MS Azure or AWS.  It remains a SAAS offering with SAP.  SAP partner with the hyperscaler.  See standard slide below.
      2. No, the private cloud is only available with SAP (HEC) infrastructure.

       

      Kind regards

      Amin Hoque.

       

      /
  • Thanks Amin for nice and informative blog.

    I have few queries and will be great if you can help –

    1. Do we get SAP Data Services as free with STE.

    2. Is there any difference in Migration cockpit approach in different deployed solutions like on premise or STE.

    3. How can I check which version or S4 hana deployment we are using.

    Regards,

    Kamal

     

  • Amin is coorect the afirmation that deployment option 3 (SAP S/4HANA Private Cloud managed by SAP (HEC)) has same functionalities that deployment option 4 (SAP S/4HANA On-Premise).

    BR

    Molina

  • Dear Amin,

    Thank you for this great overview of the different options.

    Is there also a functional difference between the two cloud editions?

    1. SAP S/4HANA Cloud essentials edition (ES): previously called Multi-Tenant Edition.
    2. SAP S/4HANA Cloud extended edition (EX): previously called Single-Tenant Edition.
    • Hello Caelen

      Yes.  Currently, Extended Edition offers nearly all of the scope of regular SAP S/4HANA on-premise. Nearly all the configuration is available.

      Essentials Edition offers a reduced set of the on-premise functionality, transactions, industries, countries and languages.  It is a simplified version of ERP.  The configuration is also reduced meaning that there is less flexibility than in on-premise.

      Cheers

      Amin

       

  • Hi Amin,

    This is insightful and brings clarity.

    Also, does SAP MTE ( now ES) support multi-country instances e.g 1instance for US business & other for APAC/China?

    How mature is the SAP MTE product for China in terms of local compliance (Data regulations, tax & Payment gateway integrations)?

    • Hello Mustafa

      Yes. SAP ES can have many countries all running in one instance. The solution for China draws on the same codeline (product) as the on-premise solution.  There are many features for country localisations. It would be best for you to look at the scope items for China in BPX at this link: https://rapid.sap.com/bp/#/BP_CLD_ENTPR/S4CLD/2005/CN/20

      I do not know whether there are specific on-premise features for China that are not in S/4HANA Cloud Essentials Edition.

      Regards

      Amin Hoque

  • Thanks Amin for this very interesting overview.

    Regarding S/4 HANA cloud STE (or EX), assuming to use the ABAP restricted functionality and all new syntax rules.

    It is possible to create ABAP custom development into the system or we need to assume that only side-by-side and extension-in-app are possible? Shortly, can I create a custom report with, for example, user parameters and an ALV output and run this from SAPGUI?

    Thanks in advance and regards

    Federico