Most organizations want to take advantage of the benefits offered by in-memory technologies that support their SAP BI and SAP BW needs in business analytics, operational and strategic reporting, and planning. One of the leading in-memory products on the market is SAP HANA. Over the course of my career, I have had some large organizations that I worked with decide not to implement SAP HANA because of concerns about anticipated high costs, lack of resources, and complexity. I review what it takes to implement and support SAP HANA-based BI architecture. Starting with a high-level overview of the SAP HANA infrastructure, I then explain the typical steps an organization has to go through to set it up and the costs associated with it. I also offer some tips for how to optimize infrastructure-related total cost of ownership (TCO).

Business Needs and Required Architecture

With in-memory technologies such as SAP HANA, a lot of reporting and planning capabilities become possible due to performance and agility. With a proper approach and with the right resources in place, complex key performance indicators (KPIs) and business planning simulations based on terabytes of data can be implemented within weeks or months, depending on the amount of data and business processes complexity. In addition, with SAP HANA, modeling on big data volumes does not present a huge issue compared with modeling using traditional databases as redesigning models on large datasets in-memory requires less effort and time.

To implement, I suggest starting with a small scope and increasing it as soon as a certain level of success is achieved. For the sake of simplicity, I use a BI architecture (Figure 1) that uses BusinessObjects Data Services (BODS) as an extraction, transformation, and loading (ETL) tool, SAP BW on SAP HANA as a data-warehousing layer, and BusinessObjects as a presentation layer.

Figure 1

A BI architecture based on SAP BW and SAP HANA in-memory technologies

TCO of BW on SAP HANA Architecture

The first questions to be answered are: What are the total costs of and the effort required for setting up the architecture as shown in Figure 1? When calculating the total cost, you must factor in the following components:

• License fees for BusinessObjects, SAP BW, SAP HANA, BODS, and repository databases. For example, BusinessObjects license fees are based the number of users, SAP BW on HANA costs depend on the size of the data warehouse, and the cost of BODS depends on how many systems are connected to it and how large the data volume is to be processed.
• Product annual maintenance costs. SAP charges a fee based on approximately 20 percent of the license cost per year.
• Infrastructure costs: Hardware and network connectivity, and implementation and support. For example, costs of cloud infrastructure and vendor costs associated with its implementation and support.

I do not go into detail about application-related configuration or implementation efforts as this is a separate topic and requires analysis of specific business requirements. My focus is only on the points related to infrastructure setup, support, and TCO.

BI Infrastructure Setup

Most organizations I have worked with maintain most of their BI infrastructure on premise, and only some in the cloud. This is going to change in the future for the following reasons:

• There is no need to make substantial capital investments when using cloud-based systems.
• There is no need to maintain, train, and retain qualified resources to support an on-premise infrastructure.
• A cloud-based infrastructure can be set up much more quickly than setting up an on-premise infrastructure.
• SAP HANA is usually less expensive to set up and maintain in the cloud in the long run.

On the other hand, if an organization has issues with keeping data in the cloud due to legal or other reasons, a cloud implementation may not be a feasible option. However, with the global trend of moving data to the cloud and the availability of data protection and confidentiality agreements, more and more organizations may decide to outsource their infrastructure to the cloud.

Licensing Considerations

In the case of cloud infrastructure, SAP does not offer a traditional cloud subscription model—one that is based on data volumes, use, or number of users. It requires a bring-your-own-license (BYOL) approach.

In the architecture scenario outlined in Figure 1, SAP charges for the following licenses:

• SAP HANA Predictive Option – This is the heaviest license cost, and it depends on the size of the in-memory data warehouse you are planning to implement. This license cost is calculated based on 64GB in-memory blocks. With SAP HANA Service Pack 9, companies receive the benefit of SAP HANA Dynamic Tiering, an option that reduces the size of the in-memory database by placing hot data in SAP HANA’s in-memory tables, and warm data in extended tables. Warm memory storage, which uses a Sybase IQ hard drive, is almost as fast as in-memory, and does not require a costly in-memory SAP HANA license. Therefore, for example, if you are planning to have a 1TB at a warehouse you may only need 256GB of SAP HANA in-memory storage (the ratio recommended by SAP is 1 to 4). This would require only four SAP HANA Predictive Option license blocks. When performing sizing for your data warehouse, you also have to take into account a data-compression ratio of 1 to 4 in SAP HANA and Sybase IQ, meaning that 4TB of data fits successfully in a 1TB SAP HANA data warehouse. However, BusinessObjects needs a lot of free memory on the SAP HANA box as well in order to enable fast report execution for a number of concurrent users, so this is a consideration as well.
• SAP BusinessObjects BI Suite (concurrent users) – SAP charges for a number of concurrent users accessing BusinessObjects at the same time. When the licensed limit of concurrent users is reached, new users aren’t able to log in or run reports. An estimated ratio of concurrent to actual users is 1 to 5.
• SAP BusinessObjects BI Suite (named users) – You may want to buy a number of BusinessObjects licenses for named users. These users can always log in and run reports as long as their user IDs have named licenses.
• SAP Data Services – The license cost depends on a number of cores.
• Sybase ASE (or another database for BusinessObjects or BODS metadata repository management) – This license cost depends on a number of cores.

When calculating software license costs, you need to take into account the fact that all modern SAP presentation-layer tools, such as SAP Lumira, Design Studio, Dashboard Design, and Web Intelligence, are included in the BusinessObjects license. In addition, most of these tools can be used as a presentation layer on top of databases other than SAP HANA, such as Microsoft SQL and Oracle. This ability to mix reporting scenarios in BusinessObjects allows companies to benefit from both new and existing database platforms.

Selecting a Cloud Infrastructure Provider

When selecting a cloud infrastructure provider, you can choose from multiple options that are available on the market. Here are some guidelines to follow when making your selection:

• Make sure the infrastructure provider is flexible and scalable up or down (e.g., that you can add or remove capacities at any time).
• Ensure that you pay per use, either based on storage space, number of users, or traffic. If you do not use infrastructure, storage should be free (or almost free).
• Choose a known cloud provider. As you will be using consulting services to implement and support the cloud infrastructure, the provider should have a proven track record.
• Make sure all the application modules you plan to use are supported together with their latest releases and service packs. For instance, only as of SAP HANA Support Package 9 can you leverage SAP HANA Dynamic Tiering, but not all infrastructure providers are able to support it. Check.
• Make sure you have flexibility of installing products on a proper operating system (Linux, Unix, AIX, or Windows). For example, the SAP Lumira server version for the SAP BusinessObjects BI platform is currently available on Windows only.

Selecting an Infrastructure Implementation Integrator

The SAP HANA infrastructure cannot be set up with a few button clicks. It has to be done using qualified consultants, and potentially can be outsourced to an outside vendor. When you are selecting a vendor, it is important to pay attention to what is included in the infrastructure and Basis support services. The vendor should be an expert in setting up cloud infrastructure and have prior experience doing so. The vendor should also know about the products that are being implemented.

In a recent implementation on which I worked, the company had to go through a number of screenings with a few large offshore cloud integrators as most of them were experts in cloud technologies, but very few were experienced with SAP BI tools. The company wanted to find a partner who would set up the infrastructure in the cloud for them and, after that, provide professional Basis support services.

My take-away from this experience is that it is critical to clearly communicate with the infrastructure provider and describe relevant Basis tasks that you expect to be supported. The following is a list of some important tasks and who is responsible for doing them:

• Set up and configure applications on server
• Scale up or down in-memory or the number of users
• Set up source system connections and inter-product connectivity
• Follow up on errors, issues, and short dumps and fix them
• System copies, backup and restore
• Apply new patches, upgrades, and SAP Notes
• Maintain user profiles or roles

PC Client Tools That Need to Be Installed on Local PCs

Installing client tools may sound easy; however, in reality it often requires a lot of effort. The installations need to be supported by local IT staff, and their involvement should not be underestimated. Here is an example of tasks they may have to deal with when installing client tools:

• Finding and downloading the latest version of the tool
• Making sure PCs meet the minimum requirements and there are no software conflicts
• Installing required tools on each PC
• Generating and applying appropriate license codes when needed

Below is a sample list of client tools that you may need to install in order to support the BI SAP HANA architecture outlined in Figure 1, broken down by developers and end users.

Developers:

• SAPGUI
• SAP HANA studio with BW modeling tools
• SAP Lumira Desktop
• BEx Query Designer or Analyzer
• BusinessObjects front-end tools, including the Information Design tool
• BusinessObjects Design Studio
• BusinessObjects Microsoft Office add-ons

End users:

• Web browser
• BusinessObjects Microsoft Office add-ons
• SAP Lumira desktop

In the case of cloud infrastructure, the tools list may have to be extended by utilities that provide the appropriate tunneling connection capabilities.

Examples of Infrastructure TCO

Here are a few rough guidelines for possible BI infrastructure costs (in US dollars), based on the architecture outlined in Figure 1, that should be taken into account. For the 1TB SAP HANA data warehouse, anticipate using four 64GB license memory blocks together with the Dynamic-Tiering capabilities of SAP HANA Support Package 9.

Note there is no standard price list or one clear guide for SAP license fees. License costs can vary and have to be negotiated with SAP by each company independently. The following numbers in Table 1 are based on some of my client cases and can be used as a high-level benchmark to illustrate what the costs might be.

Table 1

Examples of estimated SAP HANA infrastructure costs

Project management and vendor selection efforts are not included in the estimated costs.

The application implementation effort is not included either as it has to be assessed on a case-by-case basis. These costs depend on a number of functional areas to be covered by the application, the number of users, user proximity, and the way the company prefers to work with application consultants (internal vs. outsourced vs. offshore, or a mixed scenario).

Start Small; Scale Up Step by Step

When the architecture is ready (as outlined in Figure 1), you may want to start with a few proof -of-concept projects to train resources and get a better idea about the overall effort required with the new SAP HANA system in place. Then you may want to proceed with implementing BI capabilities by functional area.

In order to do it efficiently, here are some implementation tips:

• Start with a small scope, covering just a few key functional areas initially.
• Use an agile project delivery approach (e.g., start with a smaller scope and deliver in iterations by covering more and more scope as you move through the process).
• Motivate and retain key architects long term.
• Make sure you involve specialists in key architectural roles, not generalists.
• Use cloud infrastructure whenever possible to optimize TCO and speed of delivery.
• Outsource infrastructure support offshore to optimize costs.
• When choosing an offshore vendor, interview its key people to make sure the vendor has the right mix of skills, qualified project managers, and a long-term commitment to support your organization.
• Use a balanced approach for application consultants and support (key roles on site supported by other roles offshore).

Sergei Peleshuk

Sergei Peleshuk has more than 15 years of experience implementing BI technologies for global clients in retail, distribution, fast-moving consumer goods (FMCG), oil, and gas industries. He has helped clients to design robust BI reporting and planning capabilities, leading them through all project phases: from analysis of requirements to building BI roadmaps, technical architecture, and efficient BI teams. Sergei is an expert in modern BI tools and technologies available on the market, including SAP Business Warehouse (SAP BW), SAP HANA, BusinessObjects, and SAP Lumira. Sergei maintains a business intelligence portal at www.biportal.org.

Sergei will be presenting at the upcoming SAPinsider HANA 2017 conference, June 14-16, 2017, in Amsterdam. For information on the event, click here.

You may contact the author at peleshuk@biportal.org.

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