Overview
A $15B Freight Railway company was in the midst of an ERP transformation, looking to move from their SAP ECC environment to S/4HANA hosted on the public cloud. The client sought to evaluate two different deployment options for S/4HANA:
- A vertically integrated subscription via SAP RISE
- S/4HANA deployed on a Hyperscaler
Approach
UpperEdge provided guidance and market insight into an overall go-to-market strategy to evaluate and negotiate Hyperscaler Infrastructure and Hyperscaler Migration Services as well as evaluate the benefits and drawbacks of SAP RISE.
This formed 3 distinct workstreams, which provided optionality into the deployment options described above:
- SAP Software (RISE & Perpetual Proposals)
- Hyperscaler
- Cloud Migration & Managed Services
Client solicited Hyperscaler proposals from GCP & Azure, and Cloud Migration proposals from Deloitte & TCS.
Leveraging deep market knowledge and a proven negotiation approach, UpperEdge enabled Client to build a detailed 10-year TCO option analysis that led to the selection and negotiation of SAP perpetual licensing hosted on GCP, with Deloitte providing Cloud Migration services.
Negotiated Outcome
As a result of the negotiation strategy laid out, the Client was able to achieve a Highly Competitive market deal for Hyperscaler Services, Cloud Migration Services, & SAP Software.
This deal enables the Client to move to S/4HANA on a Hyperscaler, where they will achieve lower run rate costs with significantly higher cost transparency. Here are some results from each deal we helped Client negotiate.
Hyperscaler & Cloud Migration Services Deal Highlights:
- Achieved a 69% increase in vendor investments and a 33% increase in consumption discounting from original proposal.
- Optimized the annual run rate of the selected Hyperscaler through negotiated increases to relationship-level discounting and reductions to ongoing support charges.
- Negotiated $1M of resource investments from selected Hyperscaler implementation partner to offset shortfalls in their proposed scope.
SAP Software Deal Highlights:
- Negotiated an additional $2.2M in savings from the initial On-Premise proposal and a highly competitive discount. Through 6 different Cloud Agreements, negotiated an additional $1.3M in annual savings from the initial proposals by achieving highly competitive to best-in-class discounts.
- Negotiated highly competitive commercial terms which created predictability through best-in-class support protections and highly competitive future price protections as well as flexibility through conversion credits and Exchange Rights.
UpperEdge helps companies form strategic relationships with SAP and their chosen cloud services providers and achieve best-in-class deals. Explore our SAP advisory services and cloud advisory services to see how we can help you maximize the value of your key IT agreements.
