Don't Rush your RISE - Empower Yourself to get RISE Right… or Go Native!

Presented together with Andrew Tribe from Visy, and my colleague PF Grillet at Mastering SAP 2023 in Melbourne.

Transcript

1. Don’t Rush Your RISE: Empower Yourself to get RISE Right… or Go Native!
2. Your speakers & Andrew Tribe Program Manager, Digital Transformation & ERP Strategy Visy Australia PF Grillet Global Lead, SAP Services SoftwareOne Sascha Wenninger Director, SAP CoE SoftwareOne &
3. Who we are
4. 150+ Operations delivering innovation, manufacturing and logistic capabilities in an integrated closed loop. This gives life to tailored solutions that deliver enduring value for our customers, partners and communities. Our comprehensive end to end solutions 4 An introduction to Visy | June 23
5. Closed loop manufacturing sets us apart 5 An introduction to Visy | June 23 PAPER & CARDBOARD 1.27M TONNES GLASS 512k TONNES PET 29k TONNES HDPE 18k TONNES OTHER PLASTICS 44k TONNES ALUMINIUM 17k TONNES STEEL 24k TONNES We take it* (FY2022) We make it (FY2022) * Includes recyclable materials used by Visy and provided to other recyclers. Source: Visy Blue Book FY2022 ANZ Materials Reporting GLASS 814k TONNES KRAFT PAPER 681k TONNES RECYCLED PAPER 813k TONNES BOARD 928k TONNES PLASTIC CONTAINERS 1B FOOD CANS 547M PLASTIC PREFORMS 1B BEVERAGE CANS 2.4B
6. 2017 AWS Migration Oracle→SQL Unicode Pratt US SAC Pratt US BPC License “Review” +3000 users 6 Visy’s SAP journey 2000 Southcorp Acquisition 4.0F 1800 users Oracle 1998 3.1H 600 users Oracle 2001 4.0F to 4.6B 2004 4.6B to 4.7 2005 Merge 3.1 to 4.7 Single Instance 2009 Merge 3.1 to 4.7 Pratt US 2400 users 2010 Cloud Telstra CSD 2011 HR Payroll off Chris21 2012 BW on HANA SAP CRM 2014 PACT Split SLO - 700 users SAP CRM 2015 ECC6 EhP7 Upgrade Global VIM rollout 2018 Move to Rimini St Shut Down Solman IQX Fiori Apps OneList Mobile SAP Gateway (ECC6+ HRP) 2019 FSCM MDO Vend+Cust SCG Carveout -20 users SAP B1 Migration 2500 users 2020 Success Factors ADP Integration Return to SAP support BTP – CPI Solman Implementation 2021 Glass Acquisition 3,500 users SAC Visy RISE Proposal 2022 IBP Concur 2023 S/4HANA assessment & Visy SAP journey | June 23
7. • ECC EHP7 on AWS – 25 Years legacy, single global instance • EULA updated 2006 • S/4HANA transfer rights acquired in 2017 • Cloud Migration to AWS in 2017 with SQL & Unicode Conversion • Supported by Rimini Street 2019 & 2020 • SAP contract renegotiated in 2020, return to SAP Support • ~3,100 users with headroom and indirect/digital coverage • Support Model – Internal, Telstra, AWS Context 7 & Visy SAP journey | June 23
8. • Relentless Pursuit of best value • Simplified, modern ERP, CRM, Supply Chain & HR Systems • Quality Master Data • AI, Automation & Machine Learning • Rationalisation of Applications – Single Instance ERP • Real Time Analytics for decision making • Seamless Networking with Customers & Suppliers Business priorities 8 & Visy SAP journey | June 23
9. Visy SAP Landscape Financial Management Supply Chain & Operations HR & Talent Management Sales & Reporting System Tools & Management.
10. 10 Visy SAP ECC Interfaces | Presentation footer ERP, Finance & Compliance HR & Talent Management Supply Chain & Operations CRM & Sales/Marketing System Tools & Mgmnt.
11. Visy’s RISE Proposal 11 & S/4HANA first proposed in 2014 & 2017 – before RISE RISE was introduced upon our return to SAP Support in Dec. 2020 Why change? • Modernise and rationalise our applications with a cloud strategy in place • ERP Strategy needs to fit to our Cloud roadmap • ECC6 EhP7 is 8 years old – limited process improvement opportunities • ECC6 mainstream support ends in 2027, 3 years extended support • User experience is dated, no real time embedded analytics • SAP Cloud Products best integrate to S/4HANA Evaluating RISE | June 23
12. Requires holistic evaluation: • Commercial & Licensing: Procurement, Finance, Legal • Hosting environment: IT Technical • Managed Services: IT Application Services • Strategic alignment 12 Managed Services Hosting Commercial & Licensing RISE Primer | How to evaluate Evaluating RISE | June 23 &
13. • Surrender your perpetual license • Subscription contract with 5+ year duration, with implied renewal “forever” • Common questions: − Scope coverage: products not covered by RISE? − Special concessions? − Historical discounts? − Is there a way back to perpetual? − Estimate future costs RISE Primer | Licensing 13 Perpetual License + Maintenance Subscription & Evaluating RISE | June 23
14. • SAP-managed IaaS • Choice of hyperscaler & location • Common questions: − How do SLAs differ from what we have today? − What about existing Reserved Instances? − Can we influence infrastructure sizing? − How does it co-exist with non-SAP and SAP- adjacent infra (e.g. OpenText)? RISE Primer | Hosting 14 & Evaluating RISE | June 23
15. • What is included, and what is extra? • How does this compare to my existing Basis services? • Can I now fire my Basis team? • How does this operate with my IT Service Desk, other outsourcers? • Is this a turn-key end-to-end solution? 15 RISE Primer | Managed Services & Standard Services Cloud Application Services Optional Services Additional Services Excluded Tasks Evaluating RISE | June 23
16. 16 RISE Primer | Commercial Models 0 0.5 1 1.5 2 2.5 Year 1 Year 2 Year 3 Year 4 Year 5 Traditional Model Consumption Cost 0 1 2 3 4 5 Year 1 Year 2 Year 3 Year 4 Year 5 Ramp-up Model Consumption Cost 0 1 2 3 4 5 Year 1 Year 2 Year 3 Year 4 Year 5 Commit to Consume Model Consumption Cost 0 0.5 1 1.5 2 2.5 Year 1 Year 2 Mini RISE Consumption Cost Evaluating RISE | June 23 &
17. Comprehensive comparison of RISE vs. Native AWS with perpetual licenses • Full TCO model for both • Qualitative comparison against strategic drivers, operating model • Visy-specific recommendations based on existing SAP contracts • Consider implementation approach against Visy’s business objectives, priorities RISE Assessment Objectives 17 & Evaluating RISE | June 23
18. Software One’s RISE Assessment 18 & SAP’s RISE Proposal Visy’s BOM SAP Support contract SAP Order Forms Licensing Reports AWS Costs SAP EWAs IT Strategy IT Operating Model RISE Assessment Business Priorities Evaluating RISE | June 23
19. • Perpetual Licence future discounts in place until December 2024 • Cloud Remix Rights • Comparison between Perpetual Licenses with significant headroom v FUE equivalent and digital access volumes • Spend commitments – minimum spend agreement negotiated when returning to support – consideration of future SaaS spend • Multiple parallel contracts – 15 Appendices to base agreement, divestment agreement with split • Assessment of shelfware and potential replacement with cloud products (SAP Policy) Visy Licensing Analysis 19 & Evaluating RISE | June 23
20. Findings – TCO 20 RISE with SAP would be 4% cheaper than the native AWS scenario, but: • Risks of cost increases (additional services, RISE exit costs, cost increases on renewal) • More complex operating model (no direct access to Basis, everything via service requests, etc.) • Does not allow reuse of existing Reserved Instances • Further scope to negotiate S/4HANA Engine conversion cost RISE option would be more beneficial if there was no spend commitment & Evaluating RISE | June 23
21. Findings – RISE vs. Native hyperscaler 21 • The native AWS option better aligned with business drivers in 2022 • Visy has an experienced in-house SAP team with direct engagements è RISE would separate scope • RISE means more dependency on SAP • RISE would dilute relationship with AWS (SAP is 50% of our AWS) • RISE required commitment to additional cloud spend. Native AWS covers spend commitment via S/4HANA Engine Purchase & Evaluating RISE | June 23
22. 22 Recommendations Remain on native AWS option, for now 1 Retain perpetual licenses 2 Start planning and preparations for a future move to SAP S/4HANA 3 Re-evaluate RISE in a few years 4 & Evaluating RISE | June 23
23. 23 How are we preparing? • SAP Engagement: Readiness check, understand changes in S/4HANA • Evaluating process mining tools: Celonis & Signavio • Zero-based Security review – down to object level • Simplification Item checks – relevance checks (15%) • Review custom objects – 50% are inactive • Review custom transactions – 40% are obsolete • Review custom reports; align to strategy (SAC, Power BI, S/4HANA Embedded) • SAP DAES Star Service – review of licencing and digital access options (indirect usage) Process Licensing & Evaluating RISE | June 23
24. 24 How are we preparing? • Selective data transition – Retain 7 years? 2 years? • SNP Assessment: System scan to find usage of Org, Modules, Data Analysis, Fiori Impact • Master Data Review with the business • AWS Reserved Instance optimisation • Review of sizing – Housekeeping & Archiving • Considering options for pilot conversion and S/4HANA trial Data Tech & Evaluating RISE | June 23
25. • Plan as a migration project – even from HEC • Backup/transfer/restore – takes a long time. • Engage SAP early & assign responsibility • Understand end to end migration plan in detail è Faster, less risky paths are possible but not the “default” – requires deep engagement with SAP to realise Migration into RISE 25 & Evaluating RISE | June 23
26. 26 HA/DR 99.7% • Manually initiated • Used only in Disasters • Not customer-invokable • RTO of 4 Hours at extra cost 99.9% • Fast, cluster-based fail-over • Not all hyperscalers, regions • Used only for failures, Disasters • Not customer-invokable • Not used to minimise downtime N/A • Not Available & Evaluating RISE | June 23
27. ITSM Aspects 27 & • Swivel-chair integration. • No dedicated Technical Architect without CAS. • Everything is a ticket. Lead times apply . • Your Basis team needs to provide context, validate, test, coordinate. • Don’t assume that the person implementing a change in QA will be the same as doing the Prod change! • You need to fill the gaps in the RACI. Evaluating RISE | June 23
28. Negotiation Levers 28 & • Fixed aspects: SLAs, RACI, architecture • Some room to move on: • Price • Bill of Materials • Phased start of services • Transition mechanics • Financial commit with remix • Exit clauses • Be prepared for an up-sell push the following year Evaluating RISE | June 23
29. Key takeaways 29 What we want you to remember It’s a very important decision. Assess properly 1 Prepare, prepare, prepare 2 Business outcomes should drive cloud and ERP strategy 3 & Evaluating RISE | June 23
30. Andrew Tribe E: andrew.tribe@visy.com.au M: +61 402 892 397 Pierre-Francis Grillet E: pf.grillet@softwareone.com M: +61 407 643 822 Sascha Wenninger E: sascha.wenninger@softwareone.com M: +65 8799 1446 Stefan Baumann E: stefan.baumann@softwareone.com M: +61 477 005 010