Cloud computing and SAP

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1 Cloud computing and SAP Next Generation SAP Technologies Volume 1 of 2010

2 Table of contents Document history 1 Overview 2 SAP Landscape challenges 3 Infrastructure as a Service (IaaS) 4 Public, Private, Virtual private and Hybrid clouds 5 Amazon web services Public cloud IaaS 7 SAP Use cases of cloud computing IaaS 8 Detailed SAP use case for IaaS 8 Challenges with SAP on cloud computing IaaS 10 Case studies 11 Our point of view 12 Cloud computing and SAP

3 Document history Author Scott Wall, Bill Timm, and Bob Rushefsky Created On January 25 th, 2010 Last Edited Revision Date Version Revision Date Revision Description Author /02/2007 Initial Document created F. Sevenster

4 Overview Cloud computing is a computing model for enabling convenient, ondemand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. (National Institute of Standards and Technology) As with any new IT trend, organizations must evaluate the benefits and risks of cloud computing, then determine when and how they should embrace it. The focus of this paper will be the Infrastructure as a Service (IaaS) model of cloud computing which provides new and exciting ways of architecting and managing computing resources. While security, regulatory, and data protection issues must be addressed in the Public cloud space, there are many cloud computing benefits that SAP customers can realize today. Common landscape challenges such as server sprawl and drawn-out approval and procurement cycles can be addressed by using public cloud services or building private and hybrid clouds. Temporary systems for training, proof of concepts, and other short-term initiatives can be deployed rapidly on public cloud infrastructure with limited capital expenditure and pay-as-you-go billing arrangements. Private and hybrid clouds offer similar functionality with added security and control. In either case, system resources, staff, and expenses are used more efficiently which adds flexibility and agility to organizations. Some benefits are realized strictly through the underlying virtualization technology (i.e. server consolidation, rapid provisioning, improved manageability, and low cost high-availability) while other features are made possible by cloud computing vendor offerings. These benefits include cost models that are considered operational as opposed to capital expenditure. Public clouds also offer unconstrained capacity and the ability to dynamically ramp-up or ramp-down computing resources as required. SAP customers should embrace cloud computing infrastructure services using a staged approach, allowing ample time for staff to identify which applications and infrastructure can be deployed using cloud infrastructure technologies. A logical first step would be experimenting with non-critical applications on a public cloud using virtual private cloud services or with a controlled private cloud environment. It is important to determine when public cloud infrastructure may be appropriate versus private clouds or standard hardware options. Like any new technology, appropriate guidelines should be established to ensure implementation and support is consistent with the requirements of the technology platform and the needs of the user organization. Non-technical areas that require attention due to lack of established standards in the public cloud space include licensing models (SAP and third party), data privacy laws, data protection, and service level agreements. It is Deloitte s point of view that cloud computing is an important area of emerging technology and IT service delivery that should be evaluated and followed closely by SAP customers over the next few years. Many aspects of cloud computing such as IaaS can be leveraged today while some other areas will require time to develop before large numbers of SAP customers will embrace them for wider use.

5 SAP Landscape challenges SAP landscapes have been growing larger and more complex through the years, increasing the need for infrastructure capacity for most clients. Through SAP acquisitions and newly developed products, the number of available SAP applications has grown significantly. Typical landscapes have evolved from a single ERP instance to more complex environments with multiple integrated components such as Business Intelligence, Customer Relationship Management, and Portal. Coupled with high-availability requirements and the need to maintain change management via multi-system configurations, this often creates a server sprawl that requires massive amounts of disk storage, additional support staff, and data center expansion including rack space, cooling, and power. Organizations are also under pressure to control capital expenditures for infrastructure and related costs such as power. At the same time, SAP customers are looking for faster and more efficient ways to deploy and support SAP systems. Temporary systems for training, proof of concepts, demonstrations, and other short term initiatives are especially difficult to justify when capital expenditures or lease agreements must be approved, operational staff is overloaded, and data center capacity is limited. To help address these situations, many SAP customers are optimizing their Data centers using virtualization solutions. The Infrastructure as a Service (IaaS) model of cloud computing is based on high-levels of virtualization and is the next logical step to overcome traditional infrastructure limitations and being bound to typical procurement and installation lead times, architecture complexity, and flexibility constraints.

6 Infrastructure as a Service (IaaS) There are three primary service models of Cloud Computing, Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). The model of current primary interest for SAP landscapes and the model we are focusing on in this paper is Infrastructure as a Service. In its simplest form, IaaS is the delivery of computer infrastructure (servers, storage, networking, etc.) as a service over a high speed network, with automated provisioning and elastic capacity. A more complete definition of IaaS as defined by the National Institute of Standards and Technology is...the capability provided to the consumer to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components. The fundamental component of IaaS is virtualization. IaaS virtualizes each layer of the computing infrastructure stack which includes servers, storage and networking. Through virtualization, servers, storage and networking can be allocated and configured dynamically without human intervention. Abstraction of underlying hardware resources Public cloud examples: Amazon EC2, GoGrid Abstraction of underlying hardware, software, & application resources Public cloud examples: Azure Services Platform, Force.com Complete abstraction; outsourced from the organization Public cloud examples: SalesForce.com, Paypal

7 Public, Private, Virtual private and Hybrid clouds IaaS can be deployed using one of four models Public, Private, Virtual Private or Hybrid. A Public cloud consists of IaaS services provided by a vendor made available to the general public. The underlying infrastructure is shared among all customers. Major benefits of Public Cloud IaaS include the ability to allocate new computing resources with limited capital expenditure, no upfront costs, and paying for services as they are used. Public Cloud IaaS can offer clients economies of scale that could not be achieved using their own infrastructure. The major concerns today with Public Clouds are control and security. Since the underlying infrastructure is shared and in the vendor s control, it is unclear where the data is stored, where virtual servers are running (i.e. which datacenter, region, etc.) and how reliable security mechanisms are. For these reasons, many companies are apprehensive to entrust control of their business critical systems and applications to a Public Cloud IaaS service provider. A Private cloud consists of IaaS services provided by an organization themselves or by a service provider for the sole use of the organization. Underlying infrastructure is dedicated for use by the organization. Private Clouds are mainly focused on virtualization automation. Unlike Public Cloud IaaS, the organization has to purchase and build the underlying computing infrastructure to support the cloud environment so many benefits of Public Cloud IaaS such as economies of scale are lost. Some of the advantages of Private Cloud IaaS over Public Cloud IaaS are control, security, and governance. A Virtual private cloud is a Private Cloud built within a Public Cloud. The underlying technology of a Virtual Private Cloud (VPC) is a Virtual Private Network (VPN) connection between the client s network and the Public Cloud provider s network. A Virtual Private Cloud can make the client s servers running on the Public Cloud appear as if they are on the client s network. A VPC provides increased control over the security configuration of the systems since the client controls firewall/security configuration using their existing tools and processes. A Hybrid cloud model is the combination of Public and Private IaaS services. In a Hybrid Cloud, an organization can use both Public and Private IaaS services. For example, systems or applications that require a higher level of control and security can be run on a Private Cloud and those with less stringent control and security requirements (i.e. test, sandbox, training, etc.) can be run on a Public Cloud. One function of a Hybrid Cloud model is known as Bursting. Bursting is the use of Public Cloud infrastructure for peak computing requirements. A client may run their normal systems/processes on an internal Private Cloud and leverage additional computing power from a Public Cloud provider during peak business periods. One of the major limiting factors of Hybrid Clouds today is the lack of standardization within the cloud computing community. For example, there is no standard server/machine image format compatible with the different virtualization vendors for Private and Public Clouds. It is difficult to migrate a virtual server from one cloud environment to another if the server image is different between the clouds.

8 Hybrid Cloud Example Public Cloud Instance Volume Instance Volume Instance Volume VPC Volume Volume Instance Security Group Internet VPN Tunnel Private Cloud Client Client Server Server Server On Premise

9 Amazon web services Public cloud IaaS Amazon is one of today s leaders in the Public Cloud marketplace and serves as a good example when describing Public Cloud IaaS capabilities. Amazon Web Services is a collection of remote computing services offered over the Internet by Amazon.com. Amazon s IaaS offering is named Elastic Compute Cloud (EC2), which is a suite of services that allow a client to build a complete computing infrastructure (servers, storage, networking, etc.) via self service. As with most Public Cloud IaaS, there are no upfront costs and services are paid for as they are used. Amazon EC2 Components include the following: Amazon Machine Image (AMI) an image of a server instance that is used to launch new instances (servers). AMIs can be Amazon-provided, provided by another Amazon EC2 user, or created by the customer. Instance the resulting running system after an AMI is launched is called an instance (server). Amazon offers various instance sizes such as Small, Large, and XLarge. Volume Elastic Block Storage (EBS) is a type of storage designed specifically for Amazon EC2 instances. EBS allows you to create volumes that EC2 instances can mount as devices (i.e. SAN). Snapshot copy of a volume stored in Amazon s Simple Storage Service (S3). Can be used as backup and as a source for the creation of new volumes. Security group a named collection of access rules. These access rules specify which incoming network traffic should be delivered to a specific instance. All other incoming traffic is discarded (i.e. Firewall). Key pair security key pair used to secure access to instances. The key pair is used to SSH to individual instances or to decrypt the default Administrator password for Windows instances.

10 SAP Use cases of cloud computing IaaS There are various use cases where Cloud Computing IaaS can be leveraged within an SAP landscape to drive significant benefits. The ability to rapidly deploy new servers with storage, no upfront capital expenditure, and no long term commitment can be used to support projects that would typically require much longer lead times to procure equipment and acquire approval via traditional methods. Public Cloud IaaS is the ideal platform for systems that require quick deployment with short term durations. SAP Sandbox, Test, Training, and Demonstration systems are good candidates for Public Cloud IaaS. SAP customers can also leverage Private and Hybrid clouds to add flexibility and security to their SAP landscapes. Private clouds offer similar benefits to Public clouds with more control over data, security, and quality of service. Since the organization owns the infrastructure, they have control over how the applications are deployed and accessed, and how the cloud is managed. Another tool available to SAP customers is the Adaptive Computing Controller, which provides operational, observational, and management control of entire landscapes from a central point. SAP Adaptive Computing Controller 7.2 now supports hypervisor-based virtualization solutions by SAP Partners. An SAP customer can now leverage the benefits of Private Cloud IaaS and virtualization along with the benefits of SAP s Adaptive Computing Controller to: Reduce hardware and operational costs with increased utilization on fewer servers. Increase efficiency and flexibility. Hide complexity of the physical and virtual landscape. Create a highly flexible landscape that easily adjusts to performance needs and changing business requirements. Detailed SAP use case for IaaS An SAP customer is considering an upgrade to the next ERP release. They would like their functional team to evaluate the new functionality first to build a business case for the upgrade. The technical team would like to practice the upgrade procedure using a copy of the production system to identify potential problems before the actual upgrade. Finally, the company would like to deliver training to 2000 users before the upgrade commences. Situation: No physical servers are available. However, the company has been experimenting with virtualization and Amazon Web Services. An in-house VMware cluster with plenty of disk was configured to begin development of a Hybrid cloud and several templates/amazon machine images were created on Amazon s Public cloud, including one for the new SAP release. The customer must start the evaluation immediately to meet project approval deadlines.

11 Solution for functional team: An Amazon instance running the new release can be deployed in less than an hour with the appropriate amount of disk space. Since this is located on the Public cloud, global team members can access the system via the Internet and evaluate the new release. An alternate approach would be to deploy an inhouse virtual machine on the VMware cluster.* Solution for technical team: Since a copy of production will be used, the company will not use Amazon Public Cloud services; however, they are able to deploy an in-house virtual machine on the VMware cluster without purchasing additional hardware. Leveraging in-house virtualization enables rapid deployment while ensuring more control and security.* Solution for training requirement: No training servers exist so the company can deploy several Amazon instances to accommodate user training. Since there are limited capital expenditures and no upfront costs, the systems can be brought online immediately and shutdown when the training is complete. Costs are minimized using the pay-as-you-go method. No data center space, power, or cooling is used and operational staff interaction is minimal or not required. If the training instances will include sensitive data, the internal VMware cluster can be used to deploy training instances instead of the Public Cloud.* * This example is used to depict possible uses of Public and Private Clouds. The best approach depends upon several factors such as length of time the systems are required, internal infrastructure capacity, cost comparison, and sensitivity of data.

12 Challenges with SAP on cloud computing IaaS A major benefit of Cloud Computing IaaS and the underlying virtualization technology is the ability to quickly and easily clone systems. With cloud technology, it is possible to clone an existing SAP system and its database with minimal effort in a very short period of time. This creates a dilemma in that the new system will have the same SAP SID and hostname of the source system which can lead to user confusion and network conflicts if not properly managed through system access controls. Currently, SAP only supports the homogeneous/heterogeneous system copy process (export/import) to change the SID and hostname of an SAP system. Since the export/import method is a manual and time consuming process, this negates the benefits of Cloud Computing IaaS s fast cloning. Since SAP currently does not provide a method to easily change the SID and hostname of a system, customers must develop their own method, which may not be supported by SAP, rely on third party solutions, or isolate systems via network configuration to fully leverage the benefits of Cloud IaaS s quick and easy cloning capabilities. SAP supports the use of Private Cloud IaaS for production systems (as long as the underlying technologies are certified and released by SAP and any automation mechanisms do not have a negative effect on SAP operation) but does not currently support the use of Public Cloud IaaS for production systems as per SAP Note # which states the operating of SAP systems in a public cloud has not been released by SAP. SAP has not yet released statements regarding support of non-production systems in a Public cloud. This should not discourage SAP customers from experimenting with Public Cloud services and leveraging these capabilities for non-production systems as described in the previous section.

13 Case studies BP BP is an oil, gas, and petrochemicals & renewable company with approximately 92,000 employees, operations on 6 continents in over 100 countries, and over 22,000 service stations worldwide. With over 90 productive instances and 400 total instances across the world, BP has a steady stream of projects to facilitate upgrades, enhancements, and consolidations. These projects typically require a testing environment for temporary use and on very short notice. To meet these requirements, BP was forced to maintain a server reserve in the past so test instances could be provisioned as needed. BP chose Amazon cloud computing to quickly and cost effectively fulfill requirements of: Large scale SAP projects people over 6 18 months Multiple overlapping test cycles Require dedicated Training landscapes Early stage projects that require Sandbox environments Support Enhancements Support Pack application testing Upgrade testing Support Sandbox BP s Value Proposition for Amazon: Agility Amazon allows BP to have servers on demand while procuring and installing a physical server in an internal datacenter takes 6 8 weeks. Low process Project teams provision, manage, and decommission their own resources through an administrative web console. Cost Amazon instances are pay as you go and charges cease as soon as a server is shutdown. On a unit cost basis compared to physical servers used at BP, Amazon instances are very cost competitive. Reference: BP s Experience with Running SAP on Amazon s Cloud Computing Platform. SAP TechEd Conference, 2009.

14 Our point of view Although few organizations using SAP are ready to move mission-critical enterprise applications to Public cloud providers, they are starting to embrace Public and Private cloud infrastructure for important use cases as part of their overall IT strategy. Key benefits of Public clouds include: Reduction of internal operational workloads Increased flexibility in computing, staff, and capital utilization The use of private clouds is growing even more significantly, providing benefits of a Public cloud with more security and control. Hybrid clouds should be considered by SAP-run organizations to add agility and flexibility to their landscapes. Hybrid configurations allow certain projects to leverage internal architecture while others can scale to public cloud systems after certain decision criteria are evaluated such as cost, capacity, performance, turnaround time, how long the environment is required, and data sensitivity. Companies can start preparing for a hybrid cloud by performing an extensive review of their current infrastructure costs and capabilities. Internal costs for deploying and maintaining SAP systems must be determined and compared to public cloud services. It is also important to understand how long it takes to deploy a system internally versus Public cloud and what system performance levels can be achieved in both scenarios. This information, coupled with automation, will help create a more effective and efficient provisioning mechanism when compared to traditional methods. SAP customers should evaluate cloud computing technologies in the near term to determine what benefits may be useful to their organization. While there are specific benefits for SAP landscapes, cloud computing should be evaluated as part of the organization s overall IT strategy including a full ROI analysis. As the technology evolves, operational experience is gained, and standards emerge, there will be increased opportunities for SAP customers to leverage features of cloud computing. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member firms, each of which is a legally separate and independent entity. Please see for a detailed description of the legal structure of Deloitte Touche Tohmatsu and its member firms. Please see for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Copyright 2010 Deloitte Development LLC. All rights reserved. Member of Deloitte Touche Tohmatsu

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