Top 20 Things Every Enterprise Needs to Know About RISE with SAP
Introduction:
RISE with SAP is SAP’s flagship cloud offering to help enterprises move their ERP to the cloud. With SAP ECC support set to end by 2027, many CIOs and CTOs are evaluating RISE as part of their SAP migration strategy.
This “business transformation as a service” bundle combines SAP S/4HANA Cloud software, cloud infrastructure, and services under a single subscription.
While RISE with SAP promises simplified SAP cloud licensing and one-stop support, it also introduces new complexities in contract negotiation, pricing, and long-term cost.
In this pillar article, we break down the Top 20 things every enterprise should know about RISE with SAP, from licensing models and deployment options to hidden costs, support model changes, and negotiation tactics.
The goal is to arm IT sourcing and procurement leaders with practical insights to navigate RISE contracts wisely.
(Hint: It’s not as simple as SAP’s sales pitch – make sure you have an independent SAP licensing expert by your side!)
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Read more about SAP ERP Private Edition Transition Option: CIO Decision Guide to ECC Support Until 2033.
1. RISE with SAP Is a “Business Transformation-as-a-Service” Bundle
What It Is: RISE with SAP, launched in early 2021, is not a new software product.
It’s a repackage of SAP’s offerings into a subscription service. SAP markets RISE as “business transformation as a service,” aiming to accelerate customers’ transition to SAP S/4HANA in the cloud.
RISE bundles everything needed to run SAP in the cloud (software, infrastructure, and technical services) into one offering.
In essence, it shifts your ERP from an on-premises capital expense model to a cloud-based operating expense.
Read What Is SAP Private Cloud (Formerly RISE with SAP).
Why SAP Created RISE:
SAP’s strategy is to move its large ECC install base to S/4HANA Cloud.
With RISE, SAP is offering an all-in-one cloud solution to entice customers to leap. It simplifies procurement (one contract instead of many) and aligns with the trend toward SaaS and cloud subscriptions.
For enterprises facing the end-of-life of SAP ECC in 2027, RISE is presented as the fast-track path to modernizing on S/4HANA without managing data centers or multiple vendors.
Not Just Hype – But Not Magic: It’s important to note RISE is not a magic wand that handles your entire transformation.
It provides the technical foundation and services for running S/4HANA in the cloud; however, your organization must still execute the migration and implement the necessary process changes.
Think of RISE as SAP bundling the pieces together under one service umbrella – helpful, but not a turnkey business transformation by itself.
Read RISE with SAP Licensing (S/4HANA Cloud): Strategic Considerations for Enterprises.
2. Single-Contract Subscription: Software, Infrastructure, and Support in One
One of the most significant shifts with RISE is the adoption of a single-contract model. Traditionally, an SAP ERP landscape involves separate agreements for software licenses, annual support, cloud hosting (or hardware), and possibly third-party services.
RISE with SAP consolidates many of these elements into a single subscription contract with SAP as the sole provider.
Under RISE, you pay SAP one recurring fee that covers:
- SAP S/4HANA software licenses (but as subscription user rights, not perpetual ownership).
- Cloud infrastructure and hosting on a provider of SAP’s choice (Hyperscalers like AWS, Azure, Google Cloud, or SAP’s data centers).
- Basic technical managed services (system monitoring, basic operations, routine updates, back-ups).
- SAP support services (standard support for the S/4HANA software and cloud service, included in the subscription).
Convenience vs. Control:
The single-invoice approach is convenient – there’s “one throat to choke” for service issues and no need to separately manage data center contracts or SAP maintenance renewals. However, it also means reduced transparency. SAP doesn’t itemize the infrastructure or license costs to you.
When you’re buying a bundle, it can be challenging to determine if you’re getting a fair price for the cloud resources or paying a premium for the convenience.
In many cases, SAP applies a markup on the underlying infrastructure costs and bakes it into the subscription fee.
As a customer, you lose the ability to shop around for cloud hosting discounts – SAP becomes your cloud reseller.
Action:
Enter a RISE deal with eyes open, knowing that you are trading some control for simplicity. Insist on clarity in the contract about what’s included and how costs scale if you need more resources.
It’s okay to ask SAP for a breakdown or at least a sizing justification so you can sanity-check the bundle price.
Remember, everything is rolled up – so if you ever need to optimize or cut costs, you’ll have to do it through SAP rather than tweaking individual components.
Read SAP RISE Licensing Models: Subscription Pricing, Bundles, and Best Practices.
3. Cloud-Only Deployment (No On-Premises Option)
A fundamental aspect of RISE with SAP is that it is exclusively for cloud deployments. Under RISE, your S/4HANA system will run on SAP’s cloud infrastructure (whether in SAP’s own data center or on a hyperscaler like Azure/AWS managed by SAP).
You cannot use RISE to run S/4HANA on your on-premise servers.
This means enterprises must be willing to fully embrace a cloud model managed by SAP.
Implications of Cloud-Only:
- You relinquish direct control over the infrastructure. For any changes in sizing, region, or architecture, you will need to go through SAP. Unlike a self-hosted system, where your IT can add a server or move to a new data center, in RISE, you are tied to SAP’s cloud framework and change control processes.
- No third-party support options: In the on-prem world, some SAP customers save costs by using third-party support providers for their SAP applications (to replace SAP annual maintenance). With RISE, SAP’s support is bundled into the subscription – there is no option to opt out of SAP support or use an alternative support vendor. You are essentially locking into SAP as your support and hosting provider for the duration of the contract.
- Forced upgrades and standardization: Particularly in the Public Cloud edition (the multi-tenant SaaS option), SAP will push regular updates (e.g. quarterly) automatically to keep the system on the latest version. This continuous upgrade cycle is mandatory. Even in the Private Cloud edition, SAP will manage upgrades on a schedule (though you get more flexibility on timing). The upside is you stay current on features; the downside is you have less freedom to delay updates if your business isn’t ready.
In short, RISE with SAP shifts you to a cloud-first, SAP-managed IT strategy.
Ensure your organization is prepared for the loss of some autonomy.
For many, the benefits of offloading infrastructure management to SAP are worth it, but legacy SAP teams may need to adjust their practices.
Also, consider regulatory or data residency requirements. If your industry requires data to be stored in specific locations or you have custom security needs, confirm that SAP’s cloud options under RISE can meet those requirements.
RISE can be deployed on major hyperscalers; however, you’ll need to select from SAP’s available regions and options.
4. Two Flavors of S/4HANA Cloud: Public vs. Private Edition
When discussing RISE with SAP, it’s important to distinguish between the Public Cloud vs. Private Cloud editions of S/4HANA, as they offer different approaches:
- SAP S/4HANA Public Cloud (Multi-Tenant SaaS): This is a standardized cloud ERP, now often branded as “GROW with SAP” for new customers. It’s a multi-tenant SaaS where your S/4HANA instance is on a shared environment, and you have very limited customization capabilities. Public Cloud offers pre-built best practice processes – great for a faster, vanilla deployment. It typically has a lower cost and complexity, but you sacrifice flexibility (no traditional ABAP modifications, only limited extensions via SAP BTP). Updates are pushed to you on a quarterly schedule by SAP. Public Cloud is usually more attractive to smaller or mid-market companies or those willing to adopt standard SAP processes to get quick cloud benefits.
- SAP S/4HANA Private Cloud (Single-Tenant) – RISE with SAP: What does “RISE with SAP” typically mean for enterprise customers? This is a dedicated instance of S/4HANA (your isolated system) hosted via SAP. It allows more extensive customization and is ideal for companies transitioning their heavily tailored SAP ECC systems. The Private edition can be hosted on a hyperscaler (AWS, Azure, GCP) of your choice (arranged by SAP) or possibly SAP’s infrastructure. You have control over the timing of major version upgrades (within SAP’s guidelines) and can keep some unique custom modifications. However, it comes at a higher price than the public option and still operates under SAP’s cloud contract terms.
Most large enterprises opt for RISE Private Edition to reap cloud benefits without sacrificing their customizations and integrations.
It’s essentially the “hosted private cloud” version of S/4HANA, combining the flexibility of an on-premises (dedicated system, allowing for configuration modifications) with the outsourcing of infrastructure to SAP.
Key takeaway:
Understand which edition fits your business. If you’re a large enterprise with complex processes, the Private edition under RISE will likely be your route – but be prepared for the associated costs and a more complex contract.
If you can work with standard SAP processes or are a smaller organization, the Public Cloud (GROW with SAP) may suffice and be more cost-effective.
In any case, ensure your RISE contract specifies which edition and any limitations associated with that choice (e.g., public cloud can only be hosted in SAP’s data centers currently, while private cloud can use hyperscalers).
Read SAP RISE FUE Calculation for Contract Negotiation.
5. What the RISE Subscription Includes – Key Components
Every RISE with SAP contract will bundle a set of core components and entitlements. Here are the major pieces included in a typical RISE deal:
- SAP S/4HANA Cloud Software Licenses: You receive rights to use S/4HANA (either public or private edition) for the modules and user count specified in your contract. Instead of purchasing perpetual licenses, you’re subscribing to the software. The contract will specify which SAP products/modules are included under RISE (typically the core ERP and possibly some add-ons). You don’t separately pay for maintenance – support is included as part of the subscription.
- Infrastructure & Technical Operations: The underlying cloud infrastructure (servers, storage, network) to run S/4HANA is provided as part of RISE. SAP takes care of provisioning and managing this environment. They also handle technical tasks, such as system installation, patching, backups, and monitoring. Essentially, SAP (or their cloud sub-contractor) acts as your basis admin and hosting provider. The service includes a guaranteed level of system availability (outlined by an SLA). (Note: The base RISE offering typically includes one production environment and a limited number of non-production systems for development/testing. Additional systems or higher availability might cost extra – more on that later.)
- SAP Business Technology Platform (BTP) Credits: Most RISE packages come with a starter bundle of SAP BTP usage. BTP is SAP’s cloud platform for extensions, integrations, and analytics (think of it as the middleware and innovation toolkit). RISE might include, for example, a certain number of BTP credits or services, allowing you to build extensions or utilize the SAP Integration Suite. It’s a way SAP encourages the “clean core” approach (minimal customization in S/4, use BTP for custom apps). However, if you consume more than the included BTP amount, you will be charged according to your consumption.
- SAP Business Network Starter Pack: SAP often bundles limited access to its Business Networks. For instance, a RISE contract may include a small number of Ariba Network documents (e.g., 2,000 procurement transactions on the Ariba Network) or access to the Logistics Business Network or the Asset Intelligence Network in starter capacity. These are meant to jump-start digital collaboration with suppliers or partners. Be aware that the included volume is limited – if your business transacts heavily on these networks, you may quickly exceed the free allotment and need to purchase more.
- SAP Business Process Intelligence (Signavio): To facilitate the transition to S/4HANA, RISE typically includes access to SAP Signavio tools or similar process discovery services. These enable you to analyze current business processes and model improvements in preparation for the new system. You may receive licenses for process mining or a specified number of users for Signavio as part of the package.
- Standard Support & SLAs: SAP provides support for RISE customers typically at the Enterprise Support (cloud) level by default. This means 24/7 support for critical issues, access to the SAP support portal, and more, similar to what on-premises customers receive with Enterprise Support maintenance. The contract will include defined Service Level Agreements – for example, a uptime guarantee (commonly around 99.7% for standard, possibly higher if you pay for a premium SLA), and response times for issues. If SLAs are breached, usually the remedy is service credits. Support is bundled – you aren’t paying a separate maintenance fee; it’s included in your subscription fee.
In summary, RISE is fairly comprehensive in what it bundles: it’s your license to run S/4HANA, the systems to run it on, and a baseline of cloud platform and support services to operate it.
This “one hand to shake” approach can significantly reduce integration headaches – just ensure you know the limits of each included component (e.g., the number of users, transactions, storage, and environments, etc., which are part of the base fee).
6. What RISE Does Not Include – Implementation, Custom Support, etc.
It’s equally critical to understand what is not included in a RISE with SAP deal.
Some buyers mistakenly assume RISE is an all-encompassing program that will handle everything needed to get to S/4HANA.
In reality, RISE covers your run costs, but not necessarily your build or change costs. Key exclusions are:
- Implementation & Migration Services: RISE will provide the software and infrastructure, but this does not automatically include a team of experts to implement your S/4HANA system or perform data migration from legacy systems. You will either need to use internal resources or hire a systems integrator (or SAP Consulting) as a separate project to execute the migration, configuration, data loading, testing, and go-live. SAP may include some tools (such as SAP Readiness Check and basic migration tools) and possibly some advisory hours, but don’t expect a full implementation project to be bundled into the RISE subscription fee. Budget separately for a multi-month (or multi-year) S/4 implementation project, which often can cost as much as or more than the software, depending on scope.
- Process Consulting & Change Management: Similarly, the business transformation aspect (rethinking business processes, training users on the new system, and change management) is not part of RISE. Those are services you need to plan via internal teams or consulting partners. RISE gives you the platform; you still have to drive the transformation.
- Application Management and Functional Support: After you go live, you might need ongoing support for end-users, minor enhancements, or just running your SAP Center of Excellence. RISE’s included support covers the infrastructure and standard SAP software issues (break-fix support). It does not cover services such as a dedicated team for enhancements, custom development support, or day-to-day business process support. Many enterprises still invest in an AMS (Application Management Services) provider or build an internal support team for functional support and minor development. Those costs are not included in the RISE subscription.
- Non-SAP Software and Integrations: If your SAP system integrates with third-party applications or you have add-on software (including SAP products outside the core S/4HANA scope), these may not be included in RISE. For example, if you use a third-party tax calculation engine or a specific industry solution not in your RISE bundle, you’ll pay for those licenses separately. Integration middleware (if not using SAP’s own BTP tools) would also be separate.
The bottom line: RISE eliminates the technical hurdles of hardware and basic software maintenance, but you still need a project and budget to deploy the solution and support your users.
Any service not explicitly listed in the RISE contract is likely out of scope.
Some RISE contracts can be amended to include add-on services (for example, SAP may sell you “RISE with SAP, plus SAP Consulting hours” as a package), but this increases the cost.
Be cautious of any assumptions – if SAP is pitching RISE as “everything under one roof,” ask specifically: “Who is doing the actual implementation work? What’s the cost, and is it included?” Invariably, the answer is that you need a partner or a separate SOW for those activities.
Read RISE with SAP License Costs and Enterprise Benchmarks.
7. Subscription Licensing Model – From Named Users to FUEs
In a RISE with SAP contract, licensing moves to a subscription model based largely on users (and usage).
Instead of purchasing perpetual named-user licenses, you subscribe to a specific number of users for the S/4HANA Cloud service, which is paid annually.
Here are the key points of the RISE licensing model:
- Full User Equivalents (FUE): SAP often uses the concept of Full User Equivalents in RISE deals. Different types of users (e.g., Professional, Functional, Occasional) are weighted and summed up into a total FUE count. For example, a professional user might equal 1.0 FUE, a Functional user might be 0.5 FUE, and 30 low-level self-service users might collectively count as 0.3 FUE. This FUE count ultimately determines the subscription price. SAP effectively bundles user licensing into a single metric, simplifying billing. Ensure you understand how your user types and counts translate into FUEs, as this directly impacts the cost.
- Minimum Commitments: RISE contracts typically require a minimum purchase (e.g., a certain number of FUEs or a minimum contract value). Even if you don’t use all those users initially, you’re committing to pay for that volume. SAP does this to ensure a baseline revenue (especially if you are converting from an existing license base). Be aware of any minimum term volume – if you need less, try to negotiate it down before signing.
- Metric for Indirect Usage: Please note that Digital Access (Indirect Documents) is typically not included in the base RISE user subscription. Digital Access is SAP’s licensing for the use of SAP data by external systems (via APIs, etc.). In RISE, if your environment involves indirect usage (for instance, an e-commerce site creating sales orders in S/4HANA), you will likely need to license it separately or ensure it’s added to the RISE bundle. SAP charges for digital access based on the number of documents (such as sales orders, invoices, etc.). If it’s not covered, you might later face additional subscription fees for these indirect use cases. So, don’t overlook indirect use when planning RISE licensing.
- Line-of-Business (LoB) and Add-Ons: Beyond users and core ERP, if you require additional SAP cloud services (such as Ariba, SuccessFactors, Concur, or industry-specific solutions) as part of your landscape, these may or may not be included in the RISE deal. SAP can bundle various cloud services under a single agreement, but each service will contribute to the overall cost. Ensure that any additional components you require are identified. RISE core covers S/4HANA, but a full enterprise often also uses other SAP products – decide if those will remain separate or be included (and priced) in the RISE contract.
- Pricing Structure: SAP doesn’t publicly list RISE prices – everything is negotiated. However, the cost generally scales with the number of users (FUEs) and any additional services. There’s often a base fee plus a variable fee per user. Volume discounts can be significant at large user counts (the per-user cost for thousands of users can be a fraction of the cost for a smaller implementation). Always model the costs at the user levels you expect over the contract term. And remember: subscription fees include support and hosting, so while they may appear high compared to traditional maintenance, they cover a broader range of elements.
In summary, licensing under RISE is simpler on the surface (just a subscription for X users of S/4HANA), but ensure you account for indirect usage and any extra add-ons you need.
The key is to “right-size” the user count, which we’ll discuss in negotiation tips, so you’re not paying for more capacity than necessary.
And keep an eye on how SAP’s usage metrics apply to your business (e.g., how are casual users counted, what happens if you temporarily exceed user counts, etc.).
Read RISE with SAP Strategies and Alternatives.
8. Converting Existing SAP Licenses – Trade-In and Termination Considerations
Many enterprises considering RISE with SAP already own a substantial number of SAP perpetual licenses (for ECC or other products) and have been paying maintenance for years.
What happens to those investments if you move to RISE?
Here’s what you need to know:
- Trade-In Credits: SAP will often offer a credit or incentive for customers moving to RISE to account for the unused portion of existing maintenance or as a goodwill for the licenses you “give up.” For instance, if you have $X in annual maintenance on licenses that you will no longer use once on RISE, SAP might provide a discount on the RISE subscription for a period or a one-time credit. However, don’t expect a one-for-one value of your original licenses – the credit is usually modest. SAP understands that once you decide to transition to the cloud, your existing licenses are effectively rendered obsolete.
- Termination or Shelving of On-Prem Licenses: In almost all RISE deals, SAP will require you to terminate or freeze your existing license agreements for products that are moving to RISE. They want to avoid “dual use” and double-dipping. Typically, customers sign a waiver agreeing not to use the on-premises licenses after they go live on RISE, and these licenses are placed in a state of “hibernation” (also known as shelfware) for the duration of the contract term. You stop paying maintenance on them (since you pay the RISE subscription instead). Be aware: if you fully terminate the licenses, you relinquish your perpetual rights. Sometimes, SAP instead uses a contract rider that allows reinstatement if you ever leave RISE – but that’s something you must negotiate. Default scenario: you’re effectively giving up your perpetual license rights in exchange for the cloud subscription.
- One-Way Street Risk: As a result, transitioning to RISE can be a one-way street. After a few years on RISE, if you ever consider leaving SAP’s cloud, you might find you no longer have the on-prem licenses to fall back on. To run S/4HANA on your own again, you’d have to purchase new licenses (and S/4 perpetual licenses might be at a higher price now, if SAP even sells them openly by that time). This vendor lock-in is a serious consideration. Ensure your leadership understands that once you’re two or three years into RISE, switching away could be costly – SAP is betting that you won’t leave easily.
- Partial Migrations: If you’re not migrating everything to S/4HANA Cloud at once – for instance, if you plan to keep some SAP systems on-premises for a while (such as certain satellite systems) or if you phase migration by region – you need to handle hybrid licensing carefully. Ensure that any licenses for systems you keep on-premises are maintained or adjusted to remain compliant during the transition. SAP often allows a period of “dual use” where both ECC and S/4 can run (for migration purposes), but it must be contractually agreed upon. Negotiate a coexistence clause that explicitly permits running old and new systems in parallel for a defined time without extra charges. Without that, you risk being out of compliance (since technically you’d be using SAP more broadly than your licenses allow).
Tip:
Get any promises about how your old licenses are treated in writing.
For example, if SAP says, “We’ll park your existing licenses for three years while you’re on RISE, and if RISE doesn’t work out, you can resume support on them,” have that documented in the contract or an amendment.
It’s rare for SAP to make such a promise, but it’s worth asking, especially for mission-critical systems.
At a minimum, understand the financial impact: consider negotiating that if you leave RISE, you can purchase S/4HANA perpetual licenses at a predefined discount or have some conversion rights.
The goal is to avoid being completely at SAP’s mercy in a few years with no leverage.
Read SAP Private Cloud RISE FAQs.
9. Contract Term Length – Long Commitments and Renewal Traps
RISE with SAP contracts typically require a multi-year term. It’s common to see 3-year or 5-year initial subscription terms in RISE agreements (with 5 years becoming more frequent for large deals).
This is very different from a traditional license, where you owned the license outright and paid maintenance yearly (which you could drop if you wanted, albeit losing support).
Long-Term Commitment:
When you sign a RISE contract, you’re committing to pay the subscription for the entire term. There is usually no early termination without hefty penalties.
If your business were to change or you wanted to cancel, you’d likely still owe the remaining subscription fees.
Plan carefully – is your organization comfortable committing to this SAP subscription for 5 years? Ensure the budget owners and CFO understand this obligation on the books.
Renewal and Escalation:
A tricky part is what happens at the end of the initial term. If you want to continue RISE (which is likely, unless you plan a complete move off SAP), you will have to renew the contract. SAP’s standard approach might be to present a renewal quote at the going rates in 3-5 years, which could be significantly higher (especially once you’re dependent on their cloud).
Some RISE contracts have built-in price escalators each year during the term – for example, it might state that the fee will increase by 3% annually to account for inflation or other factors.
It can be misleading: the sales quote might show a flat annual fee, but fine print indicates an increase each year (a noted industry practice SAP has, which can obscure the true 5-year cost). Always check if there’s an “Annual Index Increase” clause and what percent it is.
Avoiding Renewal Shock:
It’s critical during initial negotiations to address renewals. Don’t assume SAP will extend the same price. Where possible, negotiate caps on renewal price increases – e.g., at renewal, the price per user cannot increase by more than X%.
Some savvy customers even negotiate the renewal price in advance (like a modest fixed uplift after 5 years) or at least the right to renew at the same quantities for some capped increase. SAP may resist, but it’s worth trying, given the leverage you have before you sign (which you won’t have later).
Ramp-Up/Ramp-Down:
Another consideration is flexibility in the number of users over time. RISE contracts generally set a fixed number of users (or FUEs) throughout the term. Unlike true cloud SaaS models, you often cannot freely reduce your user count if your needs drop – you’re committed to the subscribed count.
If you expect your user counts to decrease significantly (for example, if you plan to divest a division or lay off a portion of staff), consider negotiating the ability to adjust downward at renewal or arrange for a mid-term re-evaluation.
On the flip side, if you increase users, the contract will have rates for additional users (which could be higher than the initial ones if not locked in). Ideally, lock in the price for additional users now or agree on tiered pricing so growth doesn’t gouge you later.
Key takeaway:
Treat a RISE deal like any long-term outsourcing contract – scrutinize term length, and manage the renewal upfront. If you can’t get formal caps, at least internally budget for an increase or have a strategy to push back when the time comes (perhaps by evaluating other options or maintaining leverage).
Never walk into a multi-year cloud deal without clarity on year 4, year 5, and beyond costs.
Read RISE with SAP Case Study – U.S. Hospital Network Cuts Cloud Costs by 25%.
10. Cost Comparison – Subscription vs. Perpetual (TCO Over Time)
One of the biggest debates around RISE is cost: is it cheaper or more expensive than the traditional model?
SAP positions RISE as potentially having a lower Total Cost of Ownership (TCO) because it eliminates hardware costs and includes support, among other benefits. The truth is, it depends on your time horizon and how efficiently you run things on-prem.
Upfront vs. Ongoing Costs:
With RISE (and any cloud subscription), your upfront cost is low – you’re not spending capital to buy licenses or servers. But your ongoing yearly cost is higher than just maintenance alone. For example, under perpetual licensing, you might have paid $5M once for licenses and $1M per year for maintenance.
With RISE, you might pay $2M every year. In the first few years, RISE could indeed be cheaper than buying new licenses + infrastructure. However, if you run the scenario out, by year 5 the cumulative costs of RISE can exceed the on-prem model, and beyond year 5 you continue paying whereas an owned license would mostly just incur support costs.
SAP’s TCO Claims:
SAP often claims that moving to cloud (RISE or SaaS) can save ~20% over 5 years.
This assumes certain efficiencies and avoidance of hardware refresh, staff costs, etc. While this might be true in some cases, many customers find that over a longer period (7-10 years) a subscription will cost more than keeping an on-prem system with perpetual licenses.
Essentially, if you can sweat your assets on-prem and not upgrade or pay less for infrastructure, you might spend less than a premium subscription.
Hidden Cost Factors:
Some costs might tilt the equation: for instance, RISE includes certain items (such as basic disaster recovery and some BTP use) that, on-premises, you might not be paying for (or you might overlook and take on more risk).
Conversely, RISE might require you to pay for features you don’t fully utilize (such as bundled BTP or network access).
Also, consider the cost of capital – some CFOs prefer predictable OpEx even if higher over time, versus large CapEx outlays. Part of the decision is based on financial strategy.
Run a Multi-Year Analysis: The key is to perform a detailed TCO analysis:
- Compare a 5-year or 10-year scenario of staying on-prem (with expected hardware refreshes, support fees, admin labor, downtime risk, etc.) vs. going RISE (subscription fees, likely increases, included benefits, and any extra services you’d still need).
- Include the cost of implementation (which you’ll incur in moving to S/4HANA, whether you go RISE or not).
- Account for things like potential savings from better agility in the cloud (hard to quantify but relevant if RISE enables quicker innovation).
Many find that RISE’s value lies in its agility and simplicity, rather than pure dollar savings. It may cost a bit more in the long run, but it might deliver intangible benefits (faster upgrades, less internal IT burden, quicker access to new SAP innovations).
However, if cost minimization is your goal and you’re able to run SAP efficiently in-house, you may find RISE to be expensive.
Don’t sign RISE just because of a slick ROI slide.
Do your homework on the numbers. And remember to include potential price hikes at renewal in that model – a mistake would be to calculate TCO assuming the year 1 price holds forever, which is unlikely.
Always pressure test SAP’s cost claims with your independent analysis (or with help from an SAP licensing advisor who can model scenarios). This ensures you’re making an informed decision financially, not just following the cloud hype.
11. Infrastructure “Black Box” – Sizing and Cost Transparency
When you buy RISE, part of what you’re paying for is the cloud infrastructure to host your SAP system.
SAP essentially becomes a cloud provider by proxy – they’ll run your system on AWS, Azure, GCP, or their cloud, but you won’t see the actual cloud bill. SAP gives you a combined fee.
This has a few implications:
- Initial Sizing Matters: SAP (often working with you) will size the environment needed – e.g., the number of application servers, memory and CPU requirements, storage capacity, etc. – based on your user count and data volume. This sizing is typically translated into a “T-shirt size” environment included in your RISE contract. If the sizing is too small, you may later need to upscale, which will cost more. If it’s too large, you end up paying for unused capacity. Unlike direct cloud usage, where you can scale down to save money, in RISE, you’re locked into the contracted size unless you renegotiate or amend it (usually upward adjustments only). It’s crucial to validate SAP’s sizing assumptions. Use your current system metrics or an SAP sizing exercise to ensure you’re not significantly oversized or undersized.
- Lack of Line-Item Transparency: You will not get a breakdown like “Infrastructure: $X, Software: $Y, Services: $Z”. This can make it hard to compare RISE to alternative hosting options. For instance, maybe you could run S/4HANA on Azure yourself for $500k/year in cloud costs – but SAP might be charging you the equivalent of $800k/year for the same infrastructure within RISE. SAP isn’t going to volunteer how much margin they put on top or which discounts they got from the hyperscaler. This is a pain point for many IT execs who like to optimize costs.
- Potential Premium Paid: You may end up paying a premium for the “one-stop shop” convenience. SAP might justify it by the value of its management services. But as a savvy customer, you should question the sizing and pricing. Some companies request the RISE proposal and receive a comparison quote for implementing S/4 on their own with a hyperscaler and SAP licenses to assess the markup. Use that as leverage in negotiations (“We estimate the infrastructure portion should only cost us $X with Azure – can we adjust the RISE price accordingly?”).
- Scaling Up (or Down): During your RISE term, if you need more infrastructure – say your user load or transactions grow significantly – SAP will charge for additional capacity. That could be adding extra memory, extra instances, or more storage. These typically come at a high marginal cost if not pre-negotiated. It’s wise to discuss in advance what happens if you need to scale up: how much will it cost for an extra 1TB of storage or to boost performance? Try to lock in rates for these now rather than later. Conversely, scaling down is not usually possible until renewal; you can’t easily reduce the footprint mid-term, even if your load drops.
Bottom line: You are trusting SAP with your infrastructure and paying for it through them. To avoid surprises, get as much insight as you can:
- Ask SAP what the underlying size or instance type is that they are provisioning.
- Clarify the included data volume or throughput and the cost of overages.
- Ensure any special requirements (e.g., extra sandbox system, high availability failover server) are either included or quoted now. We’ve seen cases where a disaster recovery environment or an HA setup was not in the base price, adding it after the fact doubled the infrastructure cost.
Transparency is limited, so compensate by negotiating safeguards (like cost benchmarks, capacity headroom, and predefined expansion costs).
12. Indirect Access Still Matters – Don’t Ignore Third-Party Interfaces
Moving to RISE with SAP does not eliminate SAP’s notorious indirect access licensing rules. Indirect access (also called digital access) refers to scenarios where users or systems that are not directly logged into SAP still interact with SAP data.
Common examples:
- A customer portal that creates an order in SAP via an API.
- A third-party warehouse system that queries inventory data from SAP.
- Even a robotic process automation (RPA) bot that pulls data from SAP.
In traditional SAP licensing, these scenarios often required additional licenses (sometimes named user licenses for those external users, or the newer Digital Access Document licensing).
Many customers have been caught in audits owing significant fees for indirect access in the past.
Under RISE, you need clarity on this:
- Is Digital Access included? By default, the answer is likely No – you must license it. SAP sells a specific SKU for Digital Access (document-based metric). In a RISE deal, you may negotiate to include a specific number of document licenses to ensure that known interfaces are covered. For example, if you know that a Salesforce system is creating quotes in SAP, ensure those documents are accounted for.
- If not addressed, risk of future audit: SAP retains the right to audit your usage even in the cloud context (they might not “audit” infrastructure, but they can audit if you are making calls that create documents beyond licensed rights). If you haven’t licensed indirect use and an audit finds heavy external system use, SAP could require you to purchase additional subscription components to cover it – an unbudgeted cost for you.
- Proactive Approach: Catalog all third-party systems and integrations that connect to SAP. Discuss each with SAP or your licensing advisor to see if it triggers indirect usage fees. It’s better to negotiate a flat arrangement upfront (e.g., an enterprise digital access license or specific allowance included in your RISE price) than to leave it ambiguous.
Some good news: SAP has, in certain deals, been more flexible by bundling digital access in RISE or offering a discount on it, as they aim to encourage cloud adoption.
But never assume “since I’m paying a subscription, I can integrate anything freely.” Always double-check how indirect usage is handled in your contract.
Summary:
Treat indirect access as an important box to tick in your RISE planning. If you address it early (ideally negotiating it into the contract), you prevent a nasty surprise later.
Ensure the contract language is clear on what constitutes authorized use.
Internally, continue to monitor the usage of SAP data by external applications to ensure compliance.
13. SAP BTP Consumption – Included Credits vs. Real Usage
SAP’s Business Technology Platform (BTP) is a key part of the RISE value proposition, as it enables extension and integration in the cloud.
However, BTP can become a cost wildcard if not managed:
- Included BTP Credits: Your RISE deal may come with a certain number of BTP credits (or a service plan that covers limited usage of integration services, Fiori app development, etc.). For example, the “RISE Premium” package might include a set amount of BTP resource credits per year. These credits allow you to consume BTP services up to that limit without incurring an additional charge.
- Excess Usage Charges: If your use of BTP exceeds the included amount – for instance, you build multiple custom applications on BTP, or run extensive analytics, or heavy integrations – you will incur additional fees. BTP is priced on a consumption model (based on the number of CPU hours, memory, API calls, etc. used beyond the free tier). These costs can escalate quickly, especially if your team starts leveraging BTP for many projects (e.g., building a data lake on SAP Data Warehouse Cloud, or extensive use of SAP Integration Suite for connecting dozens of systems).
- Unpredictability: The challenge is predicting BTP usage. During contract negotiation, you might not know exactly how much BTP you’ll end up needing in 2-3 years. But you should make an educated guess. If you plan to implement numerous extensions (because you’re maintaining a “clean core” in S/4 and performing custom work on BTP), then the included credits may be insufficient.
- Negotiation Angle: It’s wise to negotiate either more BTP capacity upfront or, at the very least, ceiling prices for BTP. For instance, if standard RISE comes with 1,000 credits but you anticipate needing 10,000, consider bundling more now (it will likely be cheaper as part of the initial deal than buying them later ad hoc). Alternatively, consider negotiating a fixed overage rate or an additional subscription for BTP that meets your needs at a discounted rate. Another tactic is to clarify that SAP will alert you when you approach your BTP limit – you don’t want silent overages accumulating.
- Monitoring: After the contract, continue to closely monitor BTP consumption. Ensure your basis or cloud admin team is monitoring usage so you can avoid inadvertently incurring a large bill.
In summary, treat BTP like a utility, much like how you’d watch your cloud provider bill. The RISE contract’s BTP component can be either a value-add or a hidden cost.
Make it a conscious part of your planning: if your digital strategy is heavily focused on building new apps, you may need a more substantial BTP commitment. If you plan to use it minimally, still monitor it so it doesn’t inadvertently exceed the free bundle.
Read SAP Private Cloud and BTP Credits Under RISE with SAP.
14. Hidden Costs: Extra Environments, Storage, and Growth
Beyond users and BTP, RISE contracts often have thresholds for system resources, and any excess is chargeable.
Here are some “hidden” cost areas to watch:
- Environments (Systems Landscape): The standard RISE subscription typically includes a certain number of systems, e.g., one production, one development, and one test system. If you require additional systems (such as a separate QA environment, a sandbox for experimentation, or multiple development systems for parallel projects), SAP will charge for these. Many customers assume they can have as many clients or systems as they want, only to find out that an extra sandbox might cost tens of thousands of dollars per year. Determine how many environments your project and support team realistically need and get pricing for them upfront.
- Storage and Data Growth: RISE will include a certain amount of storage (for your database and file storage). If your SAP data volume exceeds this limit, you may incur overage fees. For example, you might receive 1TB of storage included, and any additional storage beyond 100GB incurs a fee. If you anticipate high data growth (for example, if you’re in a data-intensive industry or plan to keep many years of history online), negotiate for that capacity now or understand the associated rate. Also, check if the contract includes archiving storage or if backups count against your quota.
- Performance and Throughput: If your SAP usage (transactions, concurrent users) exceeds assumptions, you may need more application servers or higher-tier hardware. This ties back to infrastructure sizing (#11 above). If your business usage suddenly spikes (perhaps you acquired a company and doubled your user count), you can’t just throw that load on the existing setup without SAP’s involvement. Additional app servers or memory will incur an additional cost. Ensure the contract has provisions for scaling and ideally pre-defined prices.
- API Calls and Integration Volume: If you frequently use a large number of API calls (especially when utilizing SAP’s APIs via BTP or the SAP API Business Hub), verify if there are any limits or charges associated with high volumes. This is a bit technical, but in some SaaS models, heavy API usage can result in additional charges. Clarify with SAP how they handle API usage in RISE (mostly covered by BTP, but ensure no double counting).
- Upgrades and New Features: While software upgrades to S/4HANA are included, if SAP introduces new modules or features (for example, a new AI-based add-on, or additional cloud services) during your term, those are not just given to you – you’d have to subscribe to them. Therefore, if your business identifies a need for a new SAP cloud product not covered in your contract, that will incur an additional cost. It sounds obvious, but sometimes management assumes RISE = “we get whatever SAP develops in the cloud.” Not exactly – you get what’s in your package; anything new, you’ll negotiate as an add-on.
Plan for Growth:
A good practice is to model best-case, expected, and high-growth scenarios for your SAP usage and see where you might hit limits. If high-growth is plausible, try to lock in predictable pricing for expanding the contract.
For instance, negotiate a price for additional blocks of 100 users now, or additional 500GB storage, so you know the cost. Otherwise, you might be quoted the full list price later when you have less leverage.
In short, capacity-related costs can sneak up on you. RISE simplifies budgeting for a steady state, but businesses aren’t static.
Always ask “What if we need more X than we have now?” for the main resources (users, systems, space, etc.). It’s better to have those options pre-negotiated than to be at SAP’s mercy later.
Read SAP Private Cloud Pros and Cons.
15. Vendor Lock-In and Exit Strategy (Know Your “Escape Hatch”)
RISE with SAP, by design, increases your dependency on SAP. This has advantages – you have a single partner responsible for your ERP service – but it also creates a strong lock-in. Once you’re in, switching away is difficult.
Consider:
- Data and Transition: If you ever wanted to move off RISE (say to another ERP, or even to an on-premise S/4HANA), you’d need to extract all your data from SAP’s cloud, potentially reimplement some systems, and ensure business continuity during the switch. That’s a major effort, akin to another migration project. This inertia means SAP knows that customers are unlikely to leave after investing in RISE, giving SAP leverage at renewal or when negotiating any changes.
- License Reversion: As discussed earlier, if you gave up perpetual licenses to go to RISE, you don’t have a simple reversion option. After the RISE term, if you choose not to renew, you might not have the right to run SAP at all unless you negotiate something or purchase new licenses. Imagine telling your CFO: “We’re dependent on this system, but if we don’t pay whatever SAP asks after year 5, we lose rights to use it.” That’s a tough spot to be in.
- Cloud Specific Functionality: SAP (and other SaaS vendors) often introduce certain cloud-only innovations (e.g., AI services, cloud-based analytics) that you might adopt while on RISE. If you leave RISE, those features might not be available in an on-premises world, potentially leaving functionality gaps or requiring new solutions. The more you integrate into SAP’s cloud ecosystem, the stickier it gets.
Planning for an Exit (Just in Case): No one signs a deal expecting it to fail, but good sourcing practice is to have a contingency plan. When negotiating RISE, consider asking for:
- Data Export Rights: Ensure the contract says SAP will provide your data in a usable format upon termination. You don’t want to be a data hostage.
- Transition Assistance: Consider negotiating a clause that allows SAP to assist (at predefined rates) in transitioning you out should you not renew. Even if purely hypothetical, having it on paper is helpful.
- Reinstatement of Licenses: If you have a significant investment in SAP, consider negotiating a mechanism with SAP to reinstate some of your perpetual licenses or convert them to traditional licenses if the cloud option doesn’t work out. They may not readily agree, but in some cases, customers have gotten conversion rights – e.g., the right to convert the subscription to a perpetual license for S/4HANA if they choose, possibly for a fee. This at least provides a fallback.
- Shorter Term or Phased Commitments: If lock-in risk is a significant concern, you might consider negotiating a shorter term (perhaps starting with 3 years instead of 5) or a phased approach (deploying part of the scope under RISE, evaluating it, and then expanding). SAP sales wants a longer contract, but depending on your negotiating power, a shorter initial term gives you an earlier “out” option or renegotiation point.
Understanding the Leverage:
After year 1 of RISE, switching course is painful (you’ve migrated, users are on the new system, etc.). SAP will be aware of this and can drive a hard bargain on any changes.
That’s why so much emphasis is placed on negotiating the initial contract tightly – you won’t easily escape or swap out later. By being aware of the lock-in, you can at least avoid nasty surprises and have a plan if things go south.
The takeaway: treat RISE as a long-term marriage. Do everything you can upfront to make that marriage work in your favor, but also quietly keep a prenuptial agreement (or contingency plan) just in case.
16. Support Model Changes – No More Third-Party Support or DIY Patches
Under RISE, your support experience and responsibilities will differ from the traditional model:
- SAP is the Support Provider: Since the RISE subscription includes support, your go-to for any issues will be SAP’s support organization (via the SAP Support Portal, customer success manager, etc.). You no longer need to contract for SAP Enterprise Support separately – it’s built in. For critical incidents, SAP has the responsibility to react (per defined SLA times). This can be a relief for companies that struggled with managing basis issues or coordinating between a hosting provider and SAP – now it’s all on SAP to coordinate internally and fix issues.
- Support Level: Typically, the included support is equivalent to SAP Enterprise Support (which is SAP’s standard support level for cloud). This includes 24/7 for Priority-1 issues, etc. If you want higher-touch support (such as SAP MaxAttention or Preferred Success, which offer more proactive services or a dedicated support engineer), that usually costs extra on top of RISE. You’d have to sign up for those premium support engagements separately. Some large RISE deals may bundle a form of premium engagement if negotiated (for example, some credits for SAP MaxAttention advisory hours), but assume standard support unless you explicitly add additional services.
- No Third-Party Support: As mentioned earlier, you cannot use third-party support providers (like Rimini Street or others) for the S/4HANA product as long as you’re in RISE. SAP is providing the software as a service – you don’t have access to the software outside of that to get someone else to support it. This is a shift for any company that previously considered third-party support to cut costs on older SAP systems. On RISE, you’re paying SAP for support whether you use it fully or not. In exchange, SAP is responsible for maintaining the system’s operation (at least at the infrastructure and software patch levels).
- Patching and Upgrades: In RISE, SAP handles system patching (applying patches, kernel updates, etc.) and manages upgrades to new versions of S/4HANA. The schedule and method differ for public vs private cloud: In the Public Cloud edition, SAP releases quarterly updates, and you have limited control over them; you must test your processes quickly and adapt to new features or changes. In the Private edition, SAP will coordinate with you on major version upgrades (such as moving to the next S/4 release) so that you can plan testing. However, Minor patches and fixes will be applied regularly as part of the service. This means your internal team is less involved in technical upgrades (a good thing in terms of effort), but you must ensure you have processes to test and validate after SAP applies updates. It’s a shared responsibility: SAP ensures the software is updated, but your team must verify that your customizations and integrations continue to function properly after the update.
- SLA on Performance/Uptime: Review the service level agreement details. Standard RISE might guarantee ~99.7% uptime (which allows some downtime per quarter). If you require a higher level of availability (99.9% or above, often necessitating a high-availability setup), this is typically offered under a “premium SLA” add-on, which incurs additional costs. High availability (e.g., failover systems in another zone) can significantly increase the subscription cost (for example, some have noted moving from 99.7% to 99.9% SLA can add 50% or more to the infrastructure cost because of the redundancy required). Determine what your business truly needs and ensure the contract accurately reflects those requirements. If 24/7 near-zero downtime is essential, be prepared to pay for an upgraded service package – and get that price and negotiation upfront.
In summary, the support model in RISE aligns with a cloud service, where you rely on SAP to maintain the system and resolve issues in the base system. This can free your team from low-level technical tasks, allowing them to focus on business applications.
However, it also means you must march to SAP’s drumbeat for updates and cannot switch support providers if you are unhappy.
To make the most of it, utilize the included support – log those tickets and leverage SAP’s expertise.
Also, maintain a good relationship with SAP’s support/account team; in cloud scenarios, SAP often assigns customer success or cloud architects to assist big customers – take advantage of that help, which is effectively part of what you’re paying for.
17. Responsibility Split – What SAP Manages vs. What You Manage
RISE with SAP alters the division of responsibilities (often captured in an RACI matrix in the contract) between you and SAP. It’s essential to understand who is responsible for what, so nothing falls through the cracks.
Major points:
- SAP’s Responsibilities: Under RISE, SAP (and its subcontractors) are responsible for the technical operation of the system. This includes: Provisioning the servers and installing S/4HANA.Ongoing system monitoring (keeping an eye on performance, automated alerting).Backup and disaster recovery setup (SAP will take regular backups and have a DR plan per the SLA).Applying patches, updates, and (for public cloud) performing system upgrades.Basic security at the infrastructure level (network security, OS patching).In some cases, user access management to the system is handled at the basic level (although you usually still manage it).
- SAP application user creation).
- Customer Responsibilities: Your organization is still responsible for everything above the infrastructure and application platform:
- Business configuration of S/4HANA involves setting up organizational structures and customizing processes via SAP IMG configuration – tasks typically handled by your functional analysts or implementation partner, not SAP.
- Data migration: extracting, cleansing, and loading your business data into S/4 – you or your SI handles that.
- Development and Customization: if you need custom programs, reports, forms, or enhancements, your developers (or partners) will create and maintain those. In the Private edition, you have ABAP access to do modifications (with some restrictions). In the Public edition, you’re limited to side-by-side extensions on BTP. Either way, SAP isn’t writing your custom code for you as part of RISE.
- Testing and UAT: You must thoroughly test your processes, especially when updates are implemented. SAP may provide a test system and even clone production for you for testing (if negotiated), but executing tests and validation is your responsibility.
- End-User Support and Training: Your helpdesk will likely handle how-to questions from users. SAP support is there for technical errors, but if a user says, “I don’t know how to do X in the new system,” that’s your internal support or training responsibility.
- Module-Specific Administration: For example, setting up batch jobs, managing user roles and authorizations (including determining who receives which t-codes), monitoring interface queues, and other tasks are typically handled by your SAP admin team or AMS partner. SAP manages system health, but it doesn’t operate your business processes.
- Grey Areas: Clarify responsibilities for tasks such as security roles, integration management, printing, UI, and client software. For example, if you use SAP GUI or Fiori, you’ll manage distributing those to users. If you integrate an external system, SAP ensures the system is up and ready to receive connections, but configuring the integration (aside from BTP tools, perhaps) is your responsibility.
The risk:
If you assume “SAP is taking care of everything now,” you might under-resource your team and hit issues. Conversely, don’t let SAP slip on what they promised to do.
The RISE contract will have documents (like a Service Description or Responsibility Matrix) – read them. Ensure your project plan and staffing cover all customer-facing tasks.
Advice:
During negotiations or onboarding, request a detailed RASCI chart (Responsible, Accountable, Support, Consulted, Informed) for activities related to implementation and operations from SAP. This will clearly show who provides what. Use it to ensure there are no gaps.
For instance, backups are SAP’s job, but are you responsible for requesting restores or for testing the restore annually? Little things like that should be known.
When everyone knows their role, you can avoid finger-pointing. If either side fails to cover a point, call it out and assign it.
A successful RISE engagement is a partnership. SAP handles the technical foundation, and you handle the business usage. Both sides need to collaborate on tasks such as performance tuning (SAP can adjust system parameters, but you may need to optimize an ABAP program), etc. Setting these expectations early prevents frustration later on.
Read Rise with SAP Case Study: South African Mining Group Cuts RISE Costs by 29%.
18. Common Pitfalls and Mistakes in RISE Deals
Even with all this knowledge, enterprises can stumble during RISE adoption.
Here are some common pitfalls to watch out for, so you can avoid them:
- Overlooking the Dual Use Period: One mistake is not properly licensing the interim period, during which you run both old and new systems in parallel. Companies have encountered surprise bills or compliance issues because they failed to negotiate a clear allowance for running ECC for 12 months alongside S/4HANA for migration. Always secure a written provision for this coexistence window, specifying duration and any limits (e.g., ECC in read-only mode after go-live).
- Over-Sizing and Shelfware: Eager to secure a good discount, companies sometimes commit to more users or services in RISE than they need, leading to “shelfware” – paying for capacity that remains unused. Examples include: buying a larger S/4HANA user count, anticipating growth that never materializes, or accepting bundled components (such as SAP Analytics Cloud or additional modules in the package) that you never implement. This often happens because SAP might bundle “sweeteners” to justify the price, or you buy extra to hit a discount tier. It’s not a bargain if you don’t use it. Be realistic and lean in what you sign up for; you can usually add more later if needed, but you can’t get money back for unused portions.
- Ignoring Renewal and Exit Terms: Many focus so much on the initial deal that they sign whatever renewal clause is standard (or none at all). Later, they find they have no protection, and SAP can double the price at renewal. Also, failing to plan for an exit (even if unlikely) is a pitfall. Always negotiate something around the renewal cap or, at the very least, the renewal process, and document what happens if you choose not to renew (e.g., data return, support for a transition). It may seem pessimistic to discuss failure upfront, but it’s pragmatic.
- Not Including Indirect Use Upfront: We mentioned this earlier, but it’s worth repeating as a potential pitfall. You go live, and six months later, SAP’s auditors (License Compliance team) come and say, “We see that your Salesforce system is creating orders in S/4, but you have no digital access license – here’s an unexpected bill, or please sign this add-on.” It can be avoided by addressing it upfront. Indirect use is easy to overlook because it’s not visible when counting named users, making this a common oversight.
- Assuming “All Inclusive” and Not Reading the Fine Print: Some customers hear the pitch “one contract, all included” and then don’t scrutinize which services are included. Later, they discover, for instance, that the contract didn’t include disaster recovery failover or a test system refresh service, among other things. Everything not explicitly in the contract is not included. A pitfall is a lack of due diligence in reviewing contract details. Always dive into the specifics of the Order Form and all attachments.
- Underestimating Internal Effort: Believing that RISE will drastically reduce your internal work can be a mistake. Yes, you don’t need to manage servers and basic technical tasks, but your business and IT teams will still be very busy with the implementation and ongoing use of the system. We’ve seen companies let go of too many IT staff, thinking SAP’s got it all, then struggle because they lost key domain knowledge. RISE is not an excuse to eliminate your SAP Center of Excellence; you still need a strong internal team or partner for the functional side.
- Security and Compliance Gaps: Assuming SAP will handle all security can be problematic. For instance, SAP will secure the cloud infrastructure, but you still need to design proper user roles and controls in S/4 (to prevent SoD conflicts, etc.). You also need to ensure data privacy compliance (e.g., GDPR) in how you use the system. If you’re in a regulated industry, verify that SAP’s cloud meets your compliance needs (certifications, access controls) – don’t assume it automatically does.
By being aware of these pitfalls, you can double-check that you’ve covered each point in your RISE plan.
Stay skeptical and detail-oriented during negotiation and planning. It’s easier to solve these issues upfront than when you’re already in the contract.
Read Rise with SAP Case Study: Swedish Pharma Company Cuts RISE Costs by 33% and Gains Exit Flexibility.
19. Negotiation Strategies – Getting the Best RISE Deal
A RISE with SAP deal is complex, but there are several proven strategies to negotiate favorable terms and optimize costs:
- Start with a License & Usage Audit: Before engaging SAP on RISE, thoroughly assess your current SAP usage. How many active users do you have? What modules are heavily used and which are idle? Often, companies find their license count on paper is higher than the actual need (due to shelfware or inactive users). Use this analysis to “right-size” the RISE proposal. If you can show that only 500 of your 800 named users are active, you might negotiate a smaller user count in RISE (saving money). Leverage actual data – SAP sales reps respond when you have facts and will adjust the deal to avoid you paying for unnecessary capacity.
- Benchmark and Alternative Options: Even if you intend to go with RISE, obtain a quote or at least an internal cost estimate for alternative approaches (such as staying on-premises or using Infrastructure-as-a-Service and bringing your licenses). This provides a benchmark to evaluate SAP’s offer. If SAP’s RISE quote comes in significantly higher than your alternative TCO, use that to negotiate a discount. Make it clear you have options – even if, realistically, moving to another ERP or staying on ECC has its downsides, showing SAP that you’ve done the math creates pressure for them to sharpen their pencil.
- Negotiate Protections and Flexibility: As discussed, try to negotiate:
- Price increase caps: e.g., no more than 5% increase at renewal, or lock in the renewal price now.Volume flexibility: Consider the right to reduce users by X% at renewal if needed, or to swap some cloud services for others (e.g., you may plan to drop a module in favor of another – negotiate swap rights). Growth terms include a fixed price for additional users added in bulk or the option to extend the contract term at pro-rated rates if you need more time. Termination clause for M&A: If your company might be acquired or you might divest a division, include terms that allow for the
- Scope Clarity in Contracts: Ensure the contract documents explicitly list what’s included, including the number of users, environments, allowed downtime hours, support levels, etc. If you need specific services (such as a quarterly system copy to refresh QA from production or help with migration), please include them. Verbal assurances are not enough. Anything not in writing could result in extra fees later (e.g., “Oh, you want a copy of the production system for training? That’s a service for $X”). Close those gaps by adding to the contract or appendix.
- Indirect Access and Dual-Use Clauses: We’ve hammered on these because they’re negotiation points:
- Get a clause that covers your identified indirect use (e.g., “The subscription includes up to Y number of digital access documents annually” or “SAP confirms that interfaces A, B, C are covered under this subscription without additional license fees”). Include a temporary dual-use clause for legacy systems with specific details (duration, scope).
- Play End-of-Quarter Timing: SAP, like many vendors, is more willing to deal near quarter-end or year-end to hit sales targets. If you sense the sales team has a quota deadline, that can be leveraged for better discounts or concessions. However, be mindful not to rush into a subpar contract just to meet their timeline; use it to your advantage, but still get the terms you need.
- Utilize Independent Experts in Negotiation: Having an independent SAP licensing advisor or experienced negotiator on your side can significantly impact the outcome (more on this in the next point). They know what discounts are common, what clauses other clients have achieved, and can directly counter SAP’s proposals with facts. Don’t be shy about bringing in expert help – SAP negotiates deals every day; you negotiate a RISE deal once, so the imbalance of experience is high. Level it with expert input.
- Document Everything: If, during negotiation, SAP says, “Yes, we’ll allow that” or “We intend to include this in the service,” ensure it is included in the contract. If something is left to the future, “we’ll work it out later,” that’s a red flag – try to resolve it now or at least include a written commitment to resolve it in a specific way.
Remember:
SAP sales representatives might initially provide a quote with very high list pricing, expecting you to negotiate it down. Do not accept the first quote. RISE deals can see significant discounts off the bat (50% or more in some large cases) if you negotiate firmly.
Focus on both price and terms – a low price is great, but it means little if SAP can hike it 50% later or if you’re hit with unforeseen fees. Aim for a balanced, well-documented agreement.
Read Rise with SAP Case Study: New York Hospital System Cuts RISE with SAP Pricing by 27%.
20. Leverage Independent SAP Licensing Advisors (Don’t Go It Alone)
Navigating a RISE with a SAP contract is one of those times when expert help is extremely valuable. SAP contracts and licensing are notoriously complex, and RISE combines software, cloud, and service terms in one.
By engaging a neutral third-party SAP licensing advisor, you gain:
- Objective Analysis: An independent advisor (such as Redress Compliance or SAPLicensingExperts.com) works for you, not for SAP. They can analyze the deal from your perspective, pointing out hidden risks or costs that SAP’s team might not emphasize. They often catch things that an internal team might miss due to unfamiliarity with SAP’s contract language or assumptions.
- Market Benchmarking: Advisors specializing in SAP deals have seen numerous RISE contracts. They know what discounts are reasonable, what concessions other clients have obtained, and where SAP has flexibility. This insight helps you negotiate from a position of knowledge. For example, they might say, “SAP recently gave another company a 30% lower per-user rate, so your quote is overpriced,” or “We’ve seen SAP agree to a 3-year term with renewal cap for a similar client – push for that.”
- Negotiation Strategy: These experts can script and sometimes directly handle negotiations with SAP on your behalf or alongside your procurement team. They are familiar with SAP’s playbook – including typical sales tactics and pressure points. If SAP says, “This is standard and cannot be changed,” an advisor often knows if that’s genuinely non-negotiable or just a bluff. They’ll help prioritize which battles to pick for the best outcome.
- License Optimization: Advisors will also help ensure you are not over-licensing. They can validate your user counts, identify if there are more cost-effective ways to license certain components, or suggest optimizations (such as using engine metrics instead of users for specific functions, if applicable). They ensure you get the necessary functionality at the lowest licensing cost.
- Legal/Contractual Insight: Although they are not acting as legal counsel, experienced SAP advisors have identified common contract pitfalls. They can suggest wording changes or clauses that protect you, which your legal team can then formally negotiate. Many legal departments aren’t deeply versed in SAP-specific terms (such as how audit rights should be framed or indirect use definitions) – an advisor bridges that gap.
- Peace of Mind: Ultimately, having a specialist involved gives CIOs and procurement officers confidence that they didn’t miss a landmine. It’s a form of insurance; the cost of consulting is tiny compared to potentially overpaying millions or agreeing to a bad term that costs dearly later.
Important: Choose an advisor who is truly independent of SAP, not one that is also a reseller of SAP or a member of SAP’s partner program in a way that could bias their recommendations. Firms like the ones mentioned focus exclusively on advising customers, so they align with your interests.
Ultimately, remember that SAP’s sales representatives, while helpful, represent SAP’s interests. For something as critical and long-term as a RISE contract, you want someone firmly in your corner.
Many enterprises engage firms like Redress Compliance or other SAP licensing experts from the outset of the evaluation and negotiation process. This often pays for itself many times over in the form of better pricing and stronger contract terms.
Read SAP Private Cloud Bundle and Tier Changes in 2025.
RISE with SAP Deal Checklist – Key Questions & Safeguards
Before you sign on the dotted line, run through this checklist to ensure you’ve covered all bases in your RISE with SAP evaluation and negotiation:
- ✅ Clear Scope & Inclusions: Do you have a detailed list of what’s included in the RISE subscription (modules, user count, environments, BTP credits, network transactions, support level)? Is every necessary component of your SAP landscape either included or accounted for? (Nothing assumed or left ambiguous.)
- ✅ Right-Sizing: Have you analyzed your current SAP usage to determine the correct number of users (FUEs) and avoided paying for inactive or duplicate users? Did you remove or reduce any bundled elements you won’t use (to avoid shelfware)?
- ✅ Indirect Access Coverage: Have all third-party systems and integrations that interface with SAP been identified, and is there a plan to license their usage (e.g., digital access documents) either through inclusion in the RISE contract or a separate agreement? No unresolved “gray area” on indirect use.
- ✅ Dual-Usage Allowance: Is there a written clause permitting legacy SAP systems (like ECC) to run in parallel with S/4HANA for a defined transition period? This should include duration (e.g., 12 months) and usage limits (e.g., read-only after go-live) to protect you during migration.
- ✅ Term Length & Renewal Terms: Are you comfortable with the contract duration (e.g., 3 or 5 years)? Have you negotiated protections for renewal, such as a cap on price increase or a right to renew at predefined terms? Make sure any annual escalation (inflation) is clearly stated and acceptable.
- ✅ Pricing Details & Flexibility: Do you understand the pricing model? (Base fee vs. per-user fee, etc.) Have you locked in rates for potential expansions, such as additional users, extra storage, or added systems? If your business shrinks, is there any flexibility to adjust down at renewal?
- ✅ Performance and SLA Requirements: Does the contract’s SLA meet your business needs (uptime percentage, RTO/RPO for disasters, support response times)? If you require high availability or higher uptime, is that included or priced in? Verify that the SLA also specifies the remedies you receive if SAP misses its targets (e.g., service credits).
- ✅ Data Residency & Compliance: Is the cloud data center location specified and compliant with your data residency requirements? (For example, EU data stays in the EU if needed.) Does the contract address data protection (GDPR) and security standards? Ensure that SAP’s responsibilities in the event of a data breach or security incident are clearly defined.
- ✅ Exit and Transition Assistance: Do you have clauses for what happens at contract end or termination? This includes SAP’s obligation to return or export your data, the duration of their support for offboarding, and any options to convert to an alternative licensing model. No one plans to fail, but having an exit plan in place is a good idea.
- ✅ Customization and Enhancements: If you’re on Private edition, are there any restrictions on custom modifications you need to be aware of? If on Public, have you planned how you’ll achieve the required customizations via BTP? Ensure you’re comfortable with the level of flexibility offered.
- ✅ Implementation Plan & Costs: Have you identified who will be responsible for the migration and implementation (internal team, SI partner, or SAP services) and allocated a budget for it outside of RISE? RISE is not an implementation project – ensure you have one lined up.
- ✅Post-Go-Live Support: Do you have a plan for ongoing support beyond what SAP provides (e.g., internal support team or AMS partner for user issues, minor enhancements, etc.)? The business will need care and feeding after going live – RISE covers system uptime, but not business process support.
- ✅Cost Projections: Did you calculate a multi-year cost projection for RISE vs staying on-prem (including all relevant factors)? Be confident that RISE is financially justified for your scenario, and you know the break-even point.
- ✅Independent Review: If possible, have you consulted an independent SAP licensing expert to review the contract and pricing? This checklist itself is a good start, but a seasoned expert might spot something unique to your situation.
If you can tick off all (or most) of these items, you’re in good shape to sign a well-informed RISE with SAP deal. If not, consider pausing and addressing the gaps – it’s better to do so now than after you’re committed.
Read SAP Private Cloud Tiers and Bundles.
Summary & Key Takeaways
RISE with SAP can be a powerful enabler of cloud transformation for enterprises, but it comes with intricate licensing and contractual considerations.
To recap the essential points:
- RISE is a bundle, not a silver bullet: It simplifies your SAP landscape into a single subscription that covers software, hosting, and support. Great for reducing complexity, but you must still invest in implementation and be mindful of what’s included (and what is not).
- Plan for the long haul: RISE is typically a 3- to 5-year commitment. Conduct a thorough TCO analysis and ensure senior leadership understands the long-term cost and lock-in. Cloud subscriptions shift spending to OpEx and can ultimately outgrow the cost of owning licenses, so negotiate safeguards like renewal caps now.
- Mind the details to avoid surprises: The “devil is in the details” – hidden costs (such as extra storage, higher SLA, and indirect access fees) can erode expected savings. Diligently review contract terms around scope, SLAs, and responsibilities. Don’t assume anything – if it’s important to your success, get it explicitly written in the contract.
- Negotiate like an outsourcing deal: Approach RISE negotiation strategically. Right-size your needs, insist on flexibility, and lock in key terms (user counts, price protections, dual-use periods, etc.). SAP’s first offer often leaves room for improvement. Use any leverage you have – including the possibility of staying on existing systems or switching to alternative solutions – to negotiate a better deal.
- Operational readiness is key: Make sure your organization is prepared for the operational shift. SAP will manage the technical platform, but you are responsible for handling your business processes, testing, and support. Ensure your team (or partners) are aligned to work in the new model (e.g., frequent updates, new tools like BTP, and coordination with SAP’s support).
- Get expert help and stay in control: Perhaps the most important takeaway – don’t navigate this alone. Involve independent SAP licensing experts to validate and guide your decisions. Their insights can save costs and prevent pitfalls. Ultimately, you want to reap the benefits of RISE (modern cloud infrastructure, up-to-date software, simplified billing) while controlling risks (cost overruns, compliance issues, lock-in).
Next Steps: For organizations considering RISE, the next step is often an internal readiness assessment. Evaluate your current SAP landscape, future requirements, and engage with an independent advisor to map out a RISE migration strategy.
It’s also wise to run a small workshop with stakeholders (IT, procurement, finance, legal) to align on goals and concerns for the RISE negotiation. And remember – the goal isn’t just to sign a cloud deal; it’s to ensure that the deal delivers long-term business value.
With careful planning, due diligence, and the right expertise in your corner, you can make RISE with SAP a success story for your enterprise’s digital transformation, on your terms and budget.
Read about our Rise with SAP Advisory Service.
