Outsourced SAP: Remote Administration vs. Managed Hosting

In our last post on SAP managed hosting, we talked about the basic risks and rewards associated with outsourcing an SAP environment. Now let’s drill down to examine a more specific topic: remote administration versus managed hosting.

At itelligence, our remote administration service delivers deep, experienced basis skills in an off-site model. We take care of SAP Basis administration, proactive monitoring, and database administration of the SAP system landscape. This ensures the long-term stability of your SAP investment and places the SAP landscape in the hands of experts. Knowing that the system is in good hands, additional SAP Basis/DBA costs can be avoided and business resources can be allocated to work on high-value, business-specific projects where their business/industry experience can be best utilized.

We also offer extended options like remote-upgrade service and application optimization. Taken together, these offerings create a robust service package. Despite the advantages of remote administration, we would advise prospective clients to choose managed hosting instead, for one very simple—and often overlooked—reason.

The Risks of Remote Administration

Although remote administration gives clients a great deal of flexibility and improved SAP landscape support, it nonetheless leaves IT hardware on client premises. This means that the client retains all of the responsibility, costs and risks associated with the infrastructure, operating system support, and all data center activities. In addition, the client also takes ownership for any service level agreements (SLAs) to the actual business users.

When people think about infrastructure, they often simply picture a server and the IT people who service it. But infrastructure also involves SAN/storage, backup/restore capability, second-site disaster-recovery capability, and hopefully a Tier 3 datacenter comprised of redundant power, cooling, fire suppression, UPS and diesel generators. And that’s just to name a few additional components.

Many organizations, especially SMBs, make purchase decisions around the quantity and quality of these critical components based on the initial sizing of the first go-live project. IT departments often find it very difficult to continue to justify the capital and expense dollars to consistently update data centers and infrastructure hardware with new equipment and technologies. Hosting providers know and understand the importance of staying current with new technology and are able to better serve their customers by leveraging a collective group for purchasing power for the new technologies.

Another risk to customer-managed/on-premise data centers  is that they are sometimes situated one or two walls away from a factory floor, where any number of accidents could compromise the stability of the infrastructure. Or consider datacenters that sit on fault lines, or in areas frequented by tornadoes or hurricanes. In addition, especially for SMBs, typical investments in data center redundancy are ignored.

Because remote administration leaves hardware on-site, it involves more risk than if a client were to take everything and move it off-site into a managed-hosting environment.

The Rewards of Managed Hosting

Managed hosting gives clients the same advantages as remote administration in terms of round-the-clock SAP servicing and monitoring. By moving hardware off-site, however, clients minimize the risk of disaster by partnering with a service provider that has taken the appropriate steps to ensure stability. In addition, the service provider takes ownership of delivering agreed-upon service level agreements (SLAs) to meet customer needs and demands. A certified SAP Global Hosting Partner and SAP Business Partner like itelligence undergoes biennial inspections from SAP AG, as a means to assist customers in selecting providers who adhere to quality standards from both an organizational and process perspective.

When Remote Administration is a Good Idea

None of this is to say that remote administration is never a good idea. In fact, remote administration can provide a strategic advantage in certain situations. When a prospective client wants to pursue managed hosting but has already invested in a Tier 3 redundant data center with enterprise-class infrastructure—and has staff capable of supporting the environment—but lacks the experience, depth and coverage needed to support the SAP instances, we recommend remote administration. This approach allows the client to take full advantage of our off-site services while leveraging their prior investment in on-site infrastructure and support. When and if this changes due to multiple business possibilities, we can smoothly migrate to a full managed-hosting environment.

Our next post will wrap up our discussion about the risks and rewards of managed hosting by taking a look at one of the most common—and important—questions surrounding outsourced SAP: How can a prospective managed-hosting customer find a trustworthy provider?

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