Tips for choosing a SAP managed services partner

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In SAP operation and administration solutions there are tasks that distracts attention from the core business, as they require multiple resources, particularly people and working capital. A specialized partner can do this work with higher quality, more innovation, or in a more economical way.

This is completely valid if the client has SAP solutions in the public cloud (AWS, Azure or GCP), since the cloud is not a 100% managed platform, but its administration is shared between the provider (hyperscaler) and the client. The hyperscaler is responsible only for managing the datacenters and the basic physical infrastructure, but everything else must be managed by the client or a partner specialized in the subject. For more information, check our recent article: Why is a managed cloud needed for SAP?

In fact, even if the client plans to adopt RISE with SAP offering, a partner will still be required for operation and administration tasks that SAP services  does not cover.

Why is it advisable to have a SAP managed services partner?

The following are among the most important reasons:

1. SAP requires specialized knowledge for infrastructure, operation, functional support, etc.
   SAP defines best practices and methodologies for everything (implementation, migration, operation, BD administration, security management, etc.) that ensure a good result.
   These practices must be integrated into a service model and cannot be implemented overnight.

2. For each aspect, SAP has a certification: Hosting, Cloud, Mobile, AMS, HANA, etc. These certifications require time, investments, trainings, etc.

3. SAP has well-developed partner ecosystem. Historically, the company has been very concerned about this. Clients do not depend on a single partner.

What are the advantages of having a partner?

• It allows focusing on business processes that SAP solutions support and not on technology, nor on SAP functional consulting.

• It allows to take advantage of the value specialized companies have to contribute, because it is not possible to have so many specializations in house.

• It allows us to keep up to date with innovation and SAP solutions complexities, because even we find it difficult.

• It allows us to obtain better quality services: 24×7 services, with geographic coverage, languages, etc.; in addition to having specialized personnel whose demand may vary at different times of the year.

• It allows us to have better control of service costs. In this scheme, costs are sincere, not sunk, therefore, better management is facilitated.

• There may also be tax benefits by replacing Capex with Opex.

Best Practices for SAP selection of managed services

1. Manage IT services, with ITIL – ITSM philosophy. Do not manage infrastructure, people, etc., but results.

2. Management based on SLA, objectives and results oriented (outcomes). These must be directly related to the business and associated with: continuity, investment protection, integration, security, innovation, user experience, etc.

3. Define integral services: A stock as complete as possible with a single person responsible.

4. Easily manageable services: with simple SLAs and cross-cutting global KPIs, not per service component.

5. Standard ITSM processes: incident management, problem management, requirements management, change or modification management.

6. Focus on management and automated processes, which can be strongly supported by tools.

The advantages of considering these practices are:

• Ease of tenders: simplicity, since the objective, or the problem to be solved is defined and not the solution. Thus, the applicant does not need to be an expert (he/she only needs to know WHAT) and the expert must be the supplier (he/she must know HOW). This way the process requires fewer questions, and these are easier to answer, etc.

• It is easier for the client to compare alternative proposals since they do not need to be homologable. Services are not “commoditizable”, but each proposer can propose a different solution. Thus the client can evaluate the knowledge and experience of each supplier, considering which one obtains the best final result (outcome + quality, cost, deadline, etc.).

• The result is a simpler contract, easy to understand, to agree and to manage during the service’s entire life cycle.

Suggestions for developing administrative tendering bases:

• Tendering and not “reverse tendering”, rewarding only economy.

• Meet with suppliers before issuing terms and conditions and provide them with a rough draft. Instead of only communicating with suppliers in a cycle of question and answer.

• Try to answer questions, instead of answering with “refer to the RFP” when it is too difficult or not understood.

• Anticipate a draft contract and negotiate clauses that may make the solution artificially expensive. Instead of “unfair” clauses and out-of-market penalties.

Suggestions for developing technical bases for tendering

• Presenting the problem and not presenting a solution, since the problem has different solutions, therefore, it is understood that different proposals and prices should be compared. When specifying a solution, identical proposals are expected and it is enough to choose the cheapest one, which will hardly be the best alternative.

• Request KPIs oriented to the expected results, ideally business KPIs, instead of specifying solutions to achieve the desired results, since those solutions may not be the optimal ones to solve the problem.

How to define the service

• The service provided by the partner must be simple, specified in terms of the client’s desired outcome, and ideally with a single party responsible. It should also be well defined, with a clear interface between the client and the partner, and it should be easily manageable, with a simple SLA and a small number of KPIs that are relevant, transparent and easy to measure.

In summary

SAP systems are especially suitable for outsourcing, as SAP provides practices and tools. There are developed service models, standardized and in operation, with very low implementation cost and minimal risk. Plus, there is sufficient expertise available.

With the right SAP outsourcing model, the client obtains multiple advantages:

• Better service quality, with the results the business needs.

• Lower cost and risk.

• Simplicity in tendering, contracting and service management process.

If you wish for us to advise you, please contact us.

Feedback/discussion with author Glen Canessa, at glen.canessa@noviscorp.com