Understanding SAP ERP options is an important step in a successful implementation journey.
SAP released S/4HANA in 2015, and it represented a significant step forward in the evolution of the company’s flagship ERP product. The release coincided with a shift toward cloud computing. Organizations that can make do with limited flexibility in exchange for a comparatively simple implementation and management should choose Public Edition, while larger enterprises with more complex functional requirements will likely gravitate toward Private Edition.
Here are the deployment options currently available for S/4HANA.
S/4HANA Cloud Public Edition
S/4HANA Cloud Public Edition is the SaaS option and was previously named S/4HANA Cloud Essentials Edition, or simply S/4HANA Cloud. At one time, it was known as Multi-Tenant Edition.
SAP created S/4HANA Cloud Public Edition as a standardized option for companies that prefer a cloud-focused ERP strategy. The company currently markets this version alongside its GROW with SAP and RISE with SAP initiatives, as both GROW with SAP and RISE with SAP can accompany Public Edition.
Both GROW with SAP and RISE with SAP are bundles of tech tools and services that are meant to make it easier for organizations to transition to S/4HANA cloud software. GROW with SAP is aimed at helping midmarket companies get started with S/4HANA. It combines preconfigured industry functionality and streamlined implementation methodologies to reduce costs and accelerate time to value. RISE with SAP offers a similar framework but includes greater flexibility, including more options for tailoring the software to meet company-specific requirements. RISE with SAP is meant for current customers, while GROW with SAP is mostly aimed at new users.
SAP hosts and manages the cloud platform for Public Edition and automatically installs upgrades, which are required. Functionality is limited to a subset of core ERP features, with industry software and operations capabilities available for 42 countries. Recent Public Edition updates emphasize built-in AI and sustainability features as well as a more extensive integration with SAP Analytics Cloud.
The most common use cases for S/4HANA Cloud Public Edition are new SAP users or subsidiaries of larger enterprises that run on SAP.
S/4HANA Cloud Private Edition
S/4HANA Cloud Private Edition, which was previously known as Single Tenant Edition, is based on a single tenancy model. The model gives users greater control over various aspects of their SAP environment, including third-party integrations, and user interface options are more widely available. Private Edition also offers partner templates, which make it easier and more efficient to build out an environment based on third-party intellectual property.
In contrast to Public Edition, Private Edition gives users access to S/4HANA’s full range of functionality. Customers using the RISE with SAP framework and who have more complex company requirements will likely opt for Private Edition.
Private Edition offers more hosting options than Public Edition, and configuration and upgrade timing are more flexible. Users who would have chosen SAP’s Extended Edition in the past would now opt for Private Edition.
Companies can deploy S/4HANA Private Edition in the cloud, on-premises, or in a hybrid environment. In the past, SAP offered a version of S/4HANA known as Any Premise, which was designed to offer the most flexibility of the S/4HANA products and was available as customer-managed Any Premise and Any Premise on HEC. However, SAP has discontinued their Any Premise versions and increased the flexibility of Private Edition.
Companies that choose S/4HANA Private Edition must pay for a minimum user count, which is based on a formula that applies weighted values to various user types, then calculates a full user equivalent. Private Edition’s minimum user count requirement and its increased cost and complexity make the product most appropriate for midsize and large enterprises.
S/4HANA customers can also host their SAP environment within their own data center or at a cloud hyperscaler. Popular options include Google Cloud Platform, Amazon Web Services and Microsoft Azure.
Jim Kofalt spent 16 years at SAP working with SME business applications and was a product manager for integration technology at Microsoft’s Business Solutions division. He is currently the president of DX4 Research, a technology advisory practice specializing in ERP and digital transformation.