SAP HCM Software Review

SAP HR Hosting & Software Pricing

Hosting and Service Level Agreement

The company's HR software is part of the flagship SAP ERP application (which is part of SAP Business Suite) and a licensed purchase with on-premise installation. While the HR software can be remotely managed, Software as a Service (SaaS) with subscription pricing is not available. However, other products within the SAP portfolio do offer private cloud, multi-tenant SaaS, and channel partner hosted options. Each of these software delivery options over very different pricing, benefits and drawbacks.

For SAP software other than on-premise, the company manages data centers in Walldorf, Germany and Newton Square, PA. These data centers have been given the company stamp of approval as Tier 4 facilities (with equipment redundancy, high availability fail-over, and multiple Internet connectivity points), but more importantly the company has achieved independent attestation such as SSAE 16 and ISO 27001 certifications. Unlike most cloud solutions, additional information about these data centers has not been provided, nor has information been given in regard to SAP's Service Level Agreements (SLAs) for the products it does host—such as Business ByDesign. A certain amount of secrecy is to be expected from some vendors regarding proprietary functionality and/or technology specifications, but given the commonplace occurrence of these cloud and hosting elements, it is quite curious that the company does not provide more insight and assurances for prospective customers. Additional data center and hosting options are available from SAP's channel partners. Each of these partners offers their own data hosting specifications (including SLAs, guarantees, etc.), so due diligence is required on the part of the customer to determine what that hosting partner explicitly offers.

SAP HR Software Pricing

SAP software pricing is complex, highly variable depending upon the sales situation and shrouded in secrecy. Because of the overlap in markets and possible applicability to different customers, below are market price points for multiple SAP software solutions.

• Depending on project scope, pricing for SAP Business One can start as low as $7,000 for one user, including on-premise software licensing and deployment. However, as SAP pointedly advises, "pricing may vary by country and currency…and…is the sole responsibility of SAP Business One partners". Interestingly enough, Business One is only available from SAP Business One partners and not licensed directly from SAP. The aforementioned (and as SAP's puts "nonbinding") software price example shows an average based on surveys among SAP Business One partners in Germany, Denmark, and Ireland. Deployment project pricing depends on project scope defined by the customer and partner. SAP also offers a hosted Business One solution via partners for as little as $95 per month for one user; however, this software price is based on a multi-year subscription; a minimum of three professional users; and does not include additional partner fees.
• Business ByDesign is a SaaS solution with a subscription-based pricing model and starts at $89 per user per month (generally with a minimum of 10 users).
• No specific software pricing details were disclosed for SAP's Business All-in-One application. However, given the on-premise nature of the solution, a software license and annual maintenance pricing model is used. In addition, SAP also offers a subscription-based hosting option for the Business All-in-One application.
• SAP's Business Suite 7 must be installed on-premise (or hosted by a third party) and, as such, a licensing model with annual maintenance contracts is at play for this purchase.

SAP pricing is highly negotiable, especially where Oracle or Workday are competitive alternatives, and particularly by quarter and fiscal year end.

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