Should You Host SAP S/4HANA on Your Own Cloud? Cost Analysis & Trade-offs

June 23, 2025by Loknath Rao

Q: How much will I save if I migrate my on premise SAP ERP to S/4HANA on my own cloud?

A:

Perhaps about 20% of what you will otherwise pay SAP!

But the whole point of getting on to SAP’s cloud, is the timely upgrades which is SAPs headache. Not yours. With your own Cloud, you need to plan upgrades and that would need two dozen people every 4 months. So effectively you will end up paying 2X of what you will pay SAP.

Q: Do I sell SAP?

A: No

Q: Can I help with making detailed trade off analysis on various deployment options on S/4HANA ERP? or even provide a detailed estimate of how much it will cost you in year 1 through 5?

A: Yes. On payment of 2$ 99¢. I can also recommend a staffing strategy so that BIGG tech firms do not con you. I like being poor but I do not like them being rich.

Q: How much does S/4HANA ‘Cost’?

A:

Magnitude Sake, For a mid size firm with 250 users.

1 million$ on Licenses and infra. Recurring Annual.
1 million$ on implementation implementation one time first year.
250K$ on annual maintenance.

Several factors at play here incl. which country you are based, what extensions you are likely to do, how customized, which partners and what’s your relationship with SAP.

Q: Why I am talking in Dollars? What about poor developing countries?

A: Expect savings in implementation costs. Perhaps to the tune of 50%. A bit of discount from SAP on license and hosting fees depending on your negotiation skills. Germany didn’t make you poor. Your rulers did.

Q: Who are some of the cheapest and knowledgeable implementation partners in town?

A:

None.

Unless you are happy engaging freshly trained SAP consultants advising you. In which case you can even get a quote of 75K$ in implementation costs from Ameerpet. It might take 6 years to go-live and take another 6 years to fix it. There are companies in India that offer AMC on SAP ECC for 70000$ per year. 5 Support consultants on shared support basis. Most getting paid under 1 million rupees per year! Some nothing at all. Because they need certificates. Barely nourished. You can spot them.

Loknath Rao

India
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India
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Philippines
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United States of America
19106 Deer Trail, Alpharetta, GA, 30004
United Kingdom
135 Kings Road, Kingston Upon Thames, England, KT2 5JE, CID- 13410043

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