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ServiceNow · 4:26 · Buyer-side briefing

Building the Honest Baseline

Session 5 of the SAP RISE Migration Series. One estate in two could not state its own infrastructure and Basis cost. Where the baseline was built properly, RISE raised the five year total in about half of evaluations, usually on sunk run labour and lost hyperscaler credits.

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The presenters in this briefing are AI generated avatars. The research, figures, and guidance are real, produced by Redress Compliance analysts from our consulting engagements and market network.

Transcript

Full narration of the briefing. Click a section heading to jump the player to that moment.

Compared against what? 0:00

Every RISE business case contains the word saving, and a saving is a comparison. So the question that decides everything is: compared against what? RISE replaces several separate cost lines with one subscription, which means a fair comparison has to rebuild your current spend across exactly the same scope. Software maintenance, infrastructure, and the labour you already spend operating the platform.

Leave any of the three out and the comparison is not merely inaccurate, it is systematically biased in one direction. Daniel is going to walk through why so few organisations can actually do this, and what happens when they finally do.

Half of estates cannot answer 0:43

Because here is what we find. About half of the estates we evaluated could not state their current infrastructure and Basis cost at all. Not disputed it, could not produce it. The spend sits across an infrastructure budget, a managed services contract, a data centre allocation and a headcount line, owned by four different people, none of whom has ever been asked to add them up.

And that is not incompetence, it is simply that nobody needed the number until now. But it means the comparison in the business case is guesswork, and guesswork always resolves in favour of whoever supplied the template.

What the honest number shows 1:19

And when it is built properly, the result is genuinely surprising to most steering committees. Where the baseline was constructed honestly, RISE raised the five year total in about half of cases. Not a majority against it, and not a majority for it. Roughly a coin flip, decided by the specifics of your estate.

Two causes dominate. Internal run labour that was already sunk, because those people do not leave the payroll when the platform moves. And hyperscaler credits that were lost in the move. Neither of those appears on a vendor comparison, and both of them are yours to count.

Sunk labour does not vanish 1:54

The labour point deserves a minute because it is where the business case is usually weakest. A RISE case typically credits the full cost of your Basis and operations team as a saving. Ask a simple question: on the day after cutover, which of these named people leaves the organisation? In most cases the honest answer is very few.

They get redeployed, which is valuable but is not a cash saving, and some of them are needed anyway to manage the SAP relationship, the custom code and the integrations that did not go anywhere. Count what genuinely leaves the cost base. Redeployment is a benefit, and it belongs in a different column from cash.

Three questions, none of them the discount 2:31

So the decision reduces to three questions, and none of them is the discount. Who should run this system. How standardised can you genuinely be, not aspirationally but in the next three years. And what is your honest current run cost.

Answer all three before the account team frames them for you, because the framing is where the decision actually gets made. If you cannot operate the platform well today and want out of that business, RISE is attractive and you should pursue it confidently. If your Basis team is a genuine strength and your hyperscaler deal is good, RISE usually adds cost, and knowing that early is worth a great deal.

The alternative you score in parallel 3:08

And the baseline work has a second payoff that people miss. A credible alternative, scored in parallel, widened the discount by eight to fifteen points. Note the word scored. Not referenced in a meeting, not implied, not threatened.

Run as a live evaluation with the same rigour applied to both options, with real dates and a real internal owner. That is the only one of the buyer side levers that behaves like a conventional price lever, and it is won by a workstream running alongside the negotiation rather than by anything said inside the room. The baseline you built for your own decision is the input that makes it credible.

The move 3:47

Here is the move. Build one page: five years, every line you pay today for SAP, including infrastructure, maintenance and the fully loaded operations labour, with a note against each saying who owns it and whether it leaves the cost base under RISE. Then put the proposal beside it on the same page and the same period. If your organisation cannot produce that page, you are not ready to evaluate the offer, and that is a finding worth reporting to your board rather than papering over.

Next time, Daniel and Claire take everything the bundle quietly does not include.

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