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Author's profile photo Danielle Larocca

What is SAP HCM for S/4HANA On-Premise (H4S4)?

SAP HCM for SAP S/4HANA On-Premise (more familiarly known as ‘H4S4’) is another variation, similar to the SAP S/4HANA Private Cloud Edition (PCE) offering, for customers who wish to extend their current investment in SAP ERP HCM. As opposed to the PCE offering, H4S4 allows continued use of the on-premise SAP® talent solutions, including learning and recruiting (subject to licensing). It will be available in Q4/2022, synced with the SAP S/4HANA® release, and can be deployed either within the SAP S/4HANA environment or run standalone. More information can be found in this blog by SAP’s Ralf Wagner. More details will become available in 2022 as the delivery date approaches. Commercial details are not yet available.

There are existing SAP customers who have made large investments in the SAP on-premise talent capabilities, including Learning Solution (LSO) and/or e-Recruiting. While it is highly recommended to move to the SAP SuccessFactors solutions, given that innovation is focused there, those who wish to extend their support for those talent modules in addition to their core HR (Personnel Administration and Organizational Management) will have a choice with this offering. As you may know, the SAP S/4HANA Private Cloud Edition offering allows customers to extend their on-premise investment through calendar year-end 2040 for the core SAP HR Payroll and Time solutions. This variation will allow for that, as well as offer support for the on-premise talent components.

H4S4: The Basics

  • Based on SAP ERP HCM with comparable functional scope and business processes

  • Running on SAP HANA DB with performance benefits

  • UX, legal changes, continuous enhancements

This is not a new code line in on-premise SAP HCM; it is simply the existing code line that SAP is putting into the S/4HANA environment for those customers moving to S/4HANA and wanting to continue to run the ERP HCM code line in the same instance as S/4HANA. It is a technical upgrade that will take customers to the latest version. It will also have performance optimizations, as well as other usability enhancements. However, customers will still need to implement and deploy the new innovations, the same as any other normal system upgrade.

H4S4: Transition notes

  • Upgrade with existing migration tools and services
  • Customers can run HCM embedded in, or in a separate, SAP S/4HANA instance
  • Any customer Enhancement Pack level is supported; however, they will end up on EhP8 (technical upgrade)

2022 Payroll Options

Starting in 2022, SAP customers will have four options for world-class SAP Payroll as detailed in the table below.

Option Payroll Description Learn more
1 SAP ERP HCM Payroll On-Premise Business as usual SAP SuccessFactors has given a commitment to their approximately 9,000 on-premise SAP Payroll customers that they will not experience an interruption in their continuous world-class support, guaranteed until calendar year end 2027, with extended support available until 2030. SAP Business Suite 7 Extension: What This Means for SAP ERP Human Capital Management Customers 
2 SAP S/4HANA Private Cloud Edition (PCE) Non-disruptive pathway to digital transformation This offering, aligned with the HXM Move program, is part of SAP’s continued commitment to helping customers continue to get ROI from their on-premise SAP investment, while creating a bridge to the cloud and the future.This is a non-disruptive way to keep your HR, Payroll Time and/or Benefits via a cost-effective pathway to the cloud, while retaining the functional richness of your existing systems. This option involves migrating to an SAP S/4HANA Private Cloud Edition (S/4 PCE) subscription, moving your environment to SAP’s own data center or in a hyperscalar (Azure, GCP, AWS). A conversion from on-premise SAP ERP HCM licenses to PCE cloud subscriptions is also required. Migrate your HCM on-premise to S/4HANA Private Cloud Edition (PCE)
3 SAP SuccessFactors Employee Central Payroll Innovation The current focus of innovation with approximately 850 customers and 48 local versions. SAP also allows partners to build their own with partner localizations.Customers running SAP Payroll (on-premise) who wish to move to SuccessFactors Employee Central Payroll (ECP) can do so using tools provided by SAP and partners. Employee Central is a prerequisite to deploying ECP. Migrate on-premise Payroll to SuccessFactors’ Employee Central with PRISM for ECP
4 SAP HCM for S/4 HANA On-Premise (H4S4) Available in Q4 2022 An offering for customers who wish to extend their current investment in SAP ERP HCM. As opposed to the PCE offering, H4S4 will allow continued use of the on-premise SAP® talent solutions, including learning and recruiting (subject to licensing). It will be available in Q4/2022, synced with the SAP S/4HANA release and can be deployed either within the SAP S/4HANA environment or run standalone. SAP Business Suite 7 Extension: What This Means for SAP ERP Human Capital Management Customers 

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      12 Comments
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      Author's profile photo Suresh Datti
      Suresh Datti

      Good blog Danielle.. can you pl verify this link?  SAP S/4HANA Private Cloud Edition (S/4 PCE)

      Author's profile photo Danielle Larocca
      Danielle Larocca
      Blog Post Author

      Sorry I fixed the broken link.

      Author's profile photo Lise Clark
      Lise Clark

      Hello Danielle,  That is an amazing article!  Thank you for that clear description of the options.  I have a question about #4. Is this a new workaround for customers who fall into #1 (wanting to keep their original on-premises payroll engine)?  It seems to allow customers to extend the life of that system until 2030....or 2040 as opposed to the push to move to Cloud by 2027.   Is this true or have I misunderstood?

      Sincerely,

      Lise Clark

      Author's profile photo Danielle Larocca
      Danielle Larocca
      Blog Post Author

      Yes, when H4S4 becomes available it will be another variation that allows customers to extend their current on-premise payroll through calendar year end 2040.

      Author's profile photo Yonas Habtemariam
      Yonas Habtemariam

      thank you for the clarification. one question i have is that, is it only for extension of the system they have or it is for companies that are going to implement SAP for the first time. meaning can they buy H4S4 rather than SF?

      Author's profile photo Danielle Larocca
      Danielle Larocca
      Blog Post Author

      I would expect once it is available on the price list, all customers and prospects will be able to buy it.

      Author's profile photo Bushair Alkatib
      Bushair Alkatib

      Great Article

      Author's profile photo Kimmo Koivu
      Kimmo Koivu

      Thanks for the article. Doing now feasilibity study for a customer.

      Author's profile photo Seiji Watanabe
      Seiji Watanabe

      Hello Daniella, Great article!  Some customers want to know any update on H4S4.

      When additional information and update (release date, technical information, etc.) would be available?

      Author's profile photo Danielle Larocca
      Danielle Larocca
      Blog Post Author

      It will be available in Q4/2022, synced with the SAP S/4HANA® release - I currently have no additional intel but I keep an eye out here in the comments to learn more.

      Author's profile photo Jochen Raab
      Jochen Raab

      Many thanks Danielle for the interesting information. Do I also have the option of migrating HCM data from an existing ERP 6.0 EHP-8 to an existing S/4 (2022). I heard there should be a tool for that.

      Author's profile photo Jonathan Gijsemans
      Jonathan Gijsemans

      Hey Danielle, we are currently running HCM in compatibility mode in s/4. We are also looking into upgrading our S/4 system. If we decide to go to s/4 2022 will our HCM be impacted big time?

      Thank you for the read! 🙂