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March 7, 2013

Delivering the promise of reduced TCO from HANA implementations

By Nitin Vilas Kulkarni

Industry Principal, Retail, CPG, Logistics and Life Sciences Unit, Infosys

While SAP HANA has gained market traction, one key apprehension organizations have is around the cost of ownership.  This comes due to the following

• One of the promises of HANA is data compression and eliminating of layers.  While this is largely true, it has been found that for complex scenarios, layers cannot be fully eliminated. Also, compression ratio varies based on original database compression as well as old database. Thus, significant compression is not guaranteed for many organizations.
• The agility and promise of reduced development cost are not fully realized due to multiple challenges associated with adoption of cutting edge technology.
• HANA license is very expensive and especially when one owns enterprise license this cost is quite significant.

I believe that many of the challenges are real and there needs to be clear steps to ensure that TCO promise is not diluted.  The organizations need to fully leverage benefits of new capabilities that are available to ensure that promise of TCO is realized. We can identify various opportunities to reduce cost and get better TCO.

• Software Costs: The software cost is primarily linked to type of license and space. The following will help reducing in-memory storage and thus license cost.
      a. Cold data movement: In view of HANA features, the following options are available and may be considered:
            o The older data can be moved to less expensive media and dropped from main memory.
            o Move older granular data to less expensive media - There are opportunities to move granular like COPA, GL data to Sybase IQ wherein data older than 2 years can be moved. Please note that this feature is expected to be available soon.
      b. BW7.3 Feature of Hot/Warm data - It is possible to move less frequently used data as warm data. This will help is managing memory better and reduce growth.

• Hardware Costs:
      a. The above features of cold data movement and BW 7.3 data profiling concept will help in reducing cost as well.
      b. Integrating cheaper media for data processing - There are multiple areas where analytics need not be done on current data and latency is acceptable (e.g. sales and marketing trend analysis, social data analytics). Here, usage of platform like Hadoop to perform initial transformation becomes very cost effective. In fact, we have examples where in Infosys trademarked TradeEdge platform has been used very effectively where HANA receives transformed data and thus memory usage is limited.

• Maintenance Costs:
       a. Enable self-service for key-users - HANA will allow exposing various tables and views to power users (through BO universe layer) for building adhoc reports for analysis.  This may be very helpful in finance and supply chain areas. This will also help in reducing support queries as business can perform 1st level analysis before coming to IT.

• Development Costs:
      a. Leverage workspace concept: BW 7.3 gives workspace for users and if enabled can help key users perform analysis with reduced IT help. This allows temporary data loads and joining with enterprise data for analysis. This may give more agility to business.
      b. Reduce/stop development of ABAP reports/extract programs - With real time data availability in HANA, ABAP report development can be minimized (or eliminated). The cost of development in HANA will be lower than ABAP since HANA gives graphic interface that reduces development efforts. Also, you can review and eliminate building of new extract programs that send data out of source systems to other applications. The development in HANA will be more cost effective using graphical interface.  Also, the change management efforts will be lower since these programs are not built in transactional systems.

Review HANA apps for their fitment - SAP has developed various apps such as Supply & Operations planning, Accelerated Trade Promotions and planning. It can present opportunity to leverage these solutions (or even on cloud offering which is available for some solutions like S&OP).

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