Pique Solutions Solaris to Windows Server Migration White Paper

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April 2010

THE BUSINES CASE FOR MIGRATION FROM SOLARIS/RISC TO WINDOWS SERVER

© 2009 Pique Solutions. All rights reserved.

Contents

Executive Summary ...................................................................................................... 1

Methodology .................................................................................................................. 2

A Framework for Evaluating Migration from Solaris to Windows .............................. 4

Framework Cost and Benefit Drivers .......................................................................................... 5

A Model for a Migration of SAP from SPARC/Solaris .................................................................. 5

The Business Case for Migration ................................................................................. 6

1. Summary Economic Analysis ............................................................................................... 7

2. Cash Flow Summary Analysis .............................................................................................. 8

3. Migration Cost Analysis ....................................................................................................... 9

4. Migration Cost Savings Analysis ........................................................................................ 10

5. Migration Value Drivers ..................................................................................................... 12

6. Strategic OS Migration Drivers .......................................................................................... 13

Migrating to Windows Server vs. Linux ..................................................................... 14

Conclusions and Guidance ........................................................................................ 16

Appendix A: Description of Cost and Benefit Drivers .............................................. 17

Microsoft and Windows Server are trademarks of the Microsoft group of companies.

Solaris is a registered trademark of Sun Microsystems, Inc.

UNIX is a registered trademark of The Open Group.

Linux is the registered trademark of Linus Torvalds in the U.S. and other countries.

All other trademarks are property of their respective owners.


© 2010 Pique Solutions. All rights reserved. 1

The ROI of migrating SAP

from SPARC/Solaris to

Windows Server is 293% over

a 5-year time horizon, with a

payback of 15 months; a

migration to Windows Server

provides 110% better ROI

than a migration to Linux.

Executive Summary Microsoft Windows Server is an increasingly popular platform for the hosting of enterprise

application workloads such as SAP. More than 65,000 SAP installations run on Windows —

more than all other platforms combined — and almost two-thirds of all new SAP installations

are deployed on Windows.

That being said, there are many customers with SAP installations running on proprietary Sun

RISC-based (SPARC) hardware and the Solaris operating system that have migrated, or are now

considering a migration, to Windows Server. There are numerous advantages as a result of this

migration, ranging from hard cost savings to IT alignment

with strategic initiatives. This paper provides a compelling

business case for the migration of SAP from the

SPARC/Solaris platform to Windows Server on standard

hardware platforms. We present a cost and value model

that clearly demonstrates the quantitative benefits of the

server hardware, operating system and even database

software platform migration. The benefits include both

tactical, hard costs savings as well as strategic, long-term

benefits.

Prior Pique Solutions survey research, as well as the

research participant screening as part of this project,

indicates that more companies are migrating SAP from UNIX

to Windows Server as compared to Linux. Our previous

research indicated as much as a 3:1 ratio of companies moving to Windows over Linux.

Certainly, a key factor to explain this difference is the economic benefit of migration of the

server operating system, and even the underlying SAP database, to Microsoft Windows Server

and Microsoft SQL Server, respectively. As our business case demonstrates, a migration to Linux,

despite the possible savings in operating system software licenses, clearly does not provide the

level of cost savings and business value as compared to a migration to Windows Server. Pique

Solutions research found the following key differences:

The migration of SAP from SPARC/Solaris to Windows Server and SQL Server provides a

rapid payback, an average of 15 months based on the companies studied. This payback

even includes an upgrade to the SAP applications as part of the migration investment.

The migration also provides a dramatic five-year return on investment of 293%, based

on substantial cost savings and business value creation as compared to continuing with

the legacy SPARC/Solaris-based installation of SAP. Key benefits include elimination of

expensive support agreements, reduction in labor costs and database-related savings.

The migration to a Microsoft operating system and database platform provides

compelling advantages over a migration to Linux, including a 110% advantage in terms

of ROI and a 6-month shorter payback.

In addition to the compelling economic benefits, the migration to Windows Server is

viewed as strategic, helping companies increase competitiveness, improve business

agility and predict IT costs more accurately.



With Sun’s year-over-year product revenues dropping by 32% last quarter, the longer-term

uncertainties associated with the Oracle acquisition, and the grim UNIX server analyst forecasts,

organizations evaluating their long term operating system investments would be wise to

consider Windows Server and SQL Server for their deployments of SAP. The economic and

strategic benefits are demonstrated in this White Paper.

Methodology Pique Solutions’ approach to the project consisted of a detailed research and data gathering

process which included developing and validating a cost and value model for evaluating the

migration from SAP running on SPARC/Solaris to SAP running on Windows Server and/or Linux.

The study hypothesis, based in part on extensive Pique Solutions survey research conducted

earlier this year, was that there are substantial economic and strategic advantages of migrating

SAP from SPARC/Solaris to Windows Server, and that these advantages are far greater relative

to a migration to Linux.

We constructed a preliminary migration cost, cost savings and business value model based on

prior Pique Solutions research and input from SAP migration experts, including a large systems

integration firm specializing in ERP migrations. Also included in developing the model was in-

depth input from two leading IT Advisory firms who analyze and forecast the server market.

We selected ERP migration, specifically SAP, for several reasons. Firstly, it represents a business-

critical workload that has wide ranging, intra-company implications across business units,

departments and functions. Due to the nature and scope of ERP applications, it also can affect

supply and demand chain dynamics. These implications range from tactical cost cutting targets

to long-term strategic initiatives. Secondly, in some cases it includes a migration of the SAP

database and/or the underlying database operating system. This provides organizations an even

greater opportunity for cost savings and business value generation.

After a detailed screening process of a pool of 1,500+ potential candidates (a random sample of

U.S. companies recruited via a proprietary panel of Sr. IT Decision Makers), we identified and

qualified eight interviewees who participated in the detailed, “blinded” primary research and

data gathering process. The data gathering consisted of two phases, a phone interview

discussing the migration project, the high level before and after environment details, key cost

and benefit information, and the qualitative migration story. The second phase of the interview

involved populating a detailed data collection instrument which captured the migration costs,

the actual/expected cost savings, the actual/expected business value drivers and the strategic

benefits achieved after migration. A few details of the study participants are as follows:

Participants were Sr. IT decision makers in companies with more than $1B in annual

revenues.

Industries represented included IT Systems Integration, IT Services, IT Advisory Services,

Wholesale, Manufacturing, Telecommunications, Banking and Financial Services.

The pre-migration ERP deployments ranged from a highly centralized, two very large

server SAP data center deployment to a very distributed 500 SAP server migration based

on a large number of company branches. All but one study participant experienced a

server consolidation as the result of the migration project.



All of the participants upgraded to a newer version of SAP in conjunction with the server

OS migration; half of the participants also performed a database, or database OS,

migration in conjunction with the SAP migration.

Based on the primary research and data collection, along with analyzing both private and

publicly available secondary research, we revised the migration cost and value model to reflect

the results of the primary and secondary research.

We also uncovered interesting directional data in the screening process utilized to source study

participants. Of the 1,556 potential research candidates for this study, more than 45%

affirmatively responded that they had completed some form of migration from Sun Solaris to

Windows Sever or Linux. Of those, 17.1% indicated that they had migrated SAP from Sun Solaris

to Windows Server, while only 10.9% indicated that they had migrated SAP from Sun Solaris to

Linux. Windows Server leads Linux also in the number of migrations of "Other Mission-Critical

Workloads" with a compounded advantage of 11.2% over Linux. These results are illustrated in

Figure 1.

Figure 1. Migration Experience Based on Screener Results

This directional data is consistent with prior Pique Solutions primary research which indicated an even greater difference in past migrations of ERP systems from the UNIX platform. In the case of Pique Solutions May 2009 survey on UNIX migration, nearly three times the number of participants migrated ERP to Windows Server as compared to Linux. Figure 2 presents the data for the respondents who have previously migrated ERP from UNIX.

Figure 2. Number of Respondents who Migrated ERP to Windows vs. Linux

10.9%

17.1%

19.5%

24.5%

0% 20% 40%

Solaris to Linux

Solaris to Windows Server

Incidence of Migrations from Sun Solaris

SAP Other Mission-Critical Workloads N = 1,556

20 7 1

05

10152025

ERP UNIX toWindows only

ERP UNIX to Linuxonly

ERP UNIX toWindows & Linux

Target platform for those who have migrated ERP from UNIX

ERP UNIX to Windows only

ERP UNIX to Linux only

ERP UNIX to Windows & Linux

N = 28



A Framework for Evaluating Migration from Solaris to Windows Pique Solutions has developed an intuitive framework for evaluating the cost savings, business

value and strategic benefits for migrating SAP from SPARC/Solaris to Windows Server running on

standard hardware. This framework includes four key elements:

1. SAP operating system and database migration cost analysis

2. Post-migration cost savings analysis

3. Post-migration business value improvement analysis

4. Post-migration strategic benefit analysis

The framework was designed to support our hypothesis that there is a spectrum of cost savings

and value creation ranging from an incremental hardware refresh to a dramatic savings and

value creation associated with a migration of SAP to Windows Server and SQL Server as the

underlying SAP database. Some SAP customers running on Sun hardware and software may also

evaluate a migration to Linux, so our framework quantifies and compares the relative cost and

value of Windows Server vis-à-vis Linux. Figure 3 illustrates the decision points for SAP

customers currently running on Sun SPARC hardware and Solaris and the impact of those

decisions on cost savings and business value.

Figure 3. A Framework for Evaluating a Migration of SAP from SPARC/Solaris

Windows Server

Migration

or

Hardware

Refresh?

1. SPARC/Solaris to

Windows Server Migration• Migration cost

• Cost savings

• Business value

• Strategic benefits

Database(SQL Server)

SAP

Linux

Database(Oracle?)

SAP

Solaris (RISC)

Database(Oracle?)

SAPSolaris

(x86/x64)

Database(Oracle?)

SAP

Cost Savings,

Business Value,

Strategic Benefit

?

?

Migration

to Windows

Or Linux?

2. Relative Cost &

Business Value Advantages of

Windows vs. Linux• Migration cost

• Cost savings

• Business value

improvement

• Strategic benefits

SAP Migration

Decisions



Framework Cost and Benefit Drivers

Table 1 provides a list of the cost, cost savings, business value and strategic drivers included in

the migration business case framework and economic analysis. A description of each of these

line items can be found in Appendix A (Tables 3 – 6).

Table 1. Business Case Framework Cost and Benefit Drivers

Migration Cost Line Items

Cost Savings Line Items

Business Value Line Items

Strategic Benefit Line Items

Migration planning

Implementation (Internal)

Implementation (3rd party)

Training

Hardware costs

OS licensing costs

OS support fees

DB licensing costs

Travel

Admin/Misc.

Software license (growth)

Hardware support/ maintenance

OS software support/ maintenance

DBMS software support/ maintenance

Management/monitoring software

Infrastructure software

SAP/OS administration labor

Database administration labor

SAP/OS operations labor

SAP/OS help desk labor

Remote/extended workforce enablement

Environmental (power/cooling)

Platform leverage (integration, collaboration, BI, etc)

Future upgrades/releases

Other costs/savings

Availability related value improvement

Increase in user adoption of SAP

Process or cycle time savings/ value (order entry, etc)

Competitiveness

Overall business agility / time to market

Predictability of costs

Access to IT resources

IT standardization / IT best practice approach

Reduction in risk

A Model for a Migration of SAP from SPARC/Solaris

Based on the cost, cost savings and business value drivers in the preceding table, Pique

Solutions developed a comprehensive, comparative cost and benefit model to quantify the

migration return on investment (ROI) over a five-year analysis horizon. The costs and benefits

were based on the actual and expected costs and benefits validated in the primary and

secondary research phases of the project. A discounted cash flow analysis was employed to

account for the relative timing of the costs and benefits spanning the five years. The cost savings

and benefits in the first year were factored down to account for the length of the migration

deployment and were factored up in years two through five to account for general growth in the

SAP environment.



The Business Case for Migration Using the framework and model, we present the economic and strategic benefits for a migration

of SAP from SPARC/Solaris, based on the synthesized data from our primary and secondary

research. There are two levels to the analysis. Firstly, we address the cost savings and business

value derived from a migration from SPARC/Solaris to Windows Server and SQL Server.

Secondly, we address the relative cost savings and business value derived from a migration to

Windows Server as compared to a migration to Linux.

To summarize our findings, several of the key points from our analysis include:

A migration of SAP from SPARC/Solaris to Windows Server and SQL Server can yield a

five-year return on investment of 293%, with a payback period of fifteen months. This

return and payback include the upgrade of SAP done in conjunction with the migration.

Based on the study participants, the average SAP migration project to Windows Server,

including a database migration, lasted six months and cost $675K. The net present value

(NPV) of the five-year cost savings and business value generated are $1.56M and

$1.09M, respectively.

The hardware and software costs associated with the migration were a relatively small

portion, only 12% of the five-year cost. Internal and third-party implementation costs

were the largest area of the investment (56% of five-year cost), mainly because the

migration included an upgrade of the SAP applications and, in several cases, a migration

of the underlying SAP database to Microsoft SQL Server.

Our research validated a significant number of cost-savings areas in the model, including

fifteen unique cost-savings line items. The three biggest areas of cost savings included a

reduction in the labor headcount for server administration, the elimination of expensive

Sun hardware and software support agreements and, finally, the considerable savings

based on migration of the database including licensing, vendor support and on-going

database administration.

The three primary business value drivers consistent in our research were increased

availability, increased user adoption of SAP and improved efficiency in the order entry

process.

The migration from SPARC/Solaris to Windows Server and SQL Server provides

dramatically better payback and return on investment as compared to a migration to

Linux. A migration to Windows Server and SQL Server provides 110 percentage points

higher ROI than that of Linux, primarily due to labor cost savings, database savings,

better platform/infrastructure leverage and increased user adoption of SAP.

“In many cases, it is at the time of an SAP upgrade when the OS migration happens. The

typical payback period for these SAP OS migrations is 1.5-2 years for Windows, and this

is based solely on the cost savings."

- $5B Global Systems Integration Firm



1. Summary Economic Analysis

The following analysis provides a summary of the return on investment and expected breakeven

based on Pique Solutions’ migration cost/benefit analysis over five years. The results are based

on the net present value (NPV) of the cost and benefit cash flows over the five year period. All of

the participants upgraded the SAP application as part of the OS migration project, so the cost of

the upgrade is also included in the analysis.

Based on an average five-year migration cost of $675K, with an average migration length of six

months from initial planning to production deployment, the companies interviewed cited

substantial cost savings and business value drivers, yielding a total five-year benefit of $2.65M.

This results in a five-year Return on Investment (ROI) of 293% and a payback of 15 months from

the completion of the migration. The summary results are illustrated in Figure 4.

Figure 4. A Five-Year Summary of a Migration of SAP from SPARC/Solaris to Windows Server

Business Case Summary

Migration Cost (Investment) $675,407

Cost Savings (NPV* of Cash Flows) $1,561,618

Business Value (NPV* of Cash Flows) $1,092,458

Five Year Benefits (NPV*) $2,654,076

Net Benefit (Return Less Investment) $1,978,669

Return On Investment 293%

Estimated Payback (Months) 15

*Discount rate for NPV of cash flows = 10%

“The financial impact of migrating to Windows was a lot more appetizing than the upgrade on Solaris.”

- $1B IT Services Firm

$675,407

$1,561,618 $1,092,458

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

Migration Cost(Investment)

Cost Savings Business Value

Five Year SAP Migration Cost/Benefit Summary

Migration Cost (Investment) Cost Savings Business Value



2. Cash Flow Summary Analysis

Figure 5 illustrates the annual analysis of the migration cost (investment), cost savings and

business value for the initial year through year five. Also illustrated are the cumulative

costs/investment and the cumulative economic benefits. The cumulative cost lines in the

graphic illustrate the payback in the first quarter of the second year after the migration from

SAP running on SPARC/Solaris to Windows Server.

Figure 5. Annual Financial Analysis of SAP Migration from SPARC/Solaris to Windows Server

Year 1 Year 2 Year 3 Year 4 Year 5

Migration Cost (Investment) $675,407 $18,333 $18,333 $18,333 $18,333

Cost Savings $204,633 $429,730 $451,217 $545,444 $497,466

Business Value $147,787 $310,353 $325,871 $342,165 $359,273

Cost Savings + Business Value $352,421 $740,084 $777,088 $887,609 $856,739

Cumulative Investment $675,407 $693,740 $712,074 $730,407 $748,740

Cumulative Benefit $352,421 $1,092,504 $1,869,592 $2,757,201 $3,613,940

*Cash flows are actual and not discounted

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

Year 1 Year 2 Year 3 Year 4 Year 5

Cu

mu

lati

ve C

ost

/Be

ne

fit

Annual SAP Migration Cost/Benefit Summary

Migration Cost (Investment) Cost Savings + Business Value

Cumulative Benefit Cumulative Investment



3. Migration Cost Analysis

Figure 6 represents the average migration-related costs for the SAP SPARC/Solaris to Windows

Server migration project along with the percentage of the total (5-year) cost for each cost line

item.

Figure 6. Average Migration Cost Analysis

Cost Line Item Cost (5YR) % of 5YR Cost

Migration Planning

$111,000 15%

Implementation (Internal)

$168,000 22%


$144,000 19%

Training $75,000 10%

Hardware costs $46,667 6%

OS licensing costs $24,000 3%

OS support fees $91,667 12%

DB licensing costs $24,500 3%

Travel $36,667 5%

Admin/Misc. $36,667 5%

Total (actual; not NPV)

$758,167 100%

A few key elements of analysis from the migration cost research are listed below:

The labor costs for the migration planning and implementation represent the majority

of the cost of the migration, 56% of the total five-year cost. The primary reason for the

substantial amount of cost is that the migration includes an upgrade of the SAP

application itself as well as the underlying ERP database migration to Windows SQL

Server/Windows Server.

Software support fees are the next major cost element, primarily because this is a

recurring annual cost of approximately $18K that amounts to about $92K over the five-

year period. This cost amount is far less than the cost savings from the retirement and

repurposing of the SPARC/Solaris OS servers, as illustrated in the next section.

New hardware purchase represents 6% of the total five-year cost, with a cost of $46K.

Server OS Licensing Costs represent only 3% of the total five-year cost, with a cost of

$24K.

Migration planning

15%

Implementation (internal)

22%


19% Training

10%

Hardware costs 6%

OS Licensing costs 3%

OS support fees 12%

DB licensing costs 3% Travel

5%

Admin / Misc.

5%



10

4. Migration Cost Savings Analysis

Figure 7 presents the average migration cost savings for the SAP migration project along with

the percentage of the five-year cost savings for each cost line item.

Figure 7. Migration Cost Savings Breakdown

Cost Savings Line Item Cost (5YR) % of 5YR Cost

Software license (growth) $142,393 7%

Hardware support/ maintenance $175,897 8%

OS software support/ maintenance $251,282 12%

DBMS software support/ maintenance $238,717 11%

Management/ monitoring software $25,128 1%

Infrastructure software $150,769 7%

SAP/OS administration labor $301,873 14%

Database administration labor $180,923 8%

SAP/OS operations labor $103,193 5%

SAP/OS help desk labor $144,068 7%

Remote/extended workforce enablement $117,265 6%

Environmental (power/cooling) $36,855 2%

Platform leverage (integration, collaboration, BI, etc) $175,897 8%

Future upgrades/releases $71,667 3%

Other costs/savings $12,564 1%

Total (actual; not NPV) $2,128,490 100%

Software license (growth)

7%Hardware

support/maintenance8%

OS software support/maintenance

12%

DBMS software support/maintenance

11%

Mgmt & monitoring software

1%Infrastructure software

7%

SAP/OS administration labor

14%

Database administration labor

8%

SAP/OS operations labor

5%

SAP/OS help desk labor7%

Remote/extended workforce

enablement

6%

Environmental (power/cooling)

2%

Platform leverage (integration,

collaboration, BI, etc)

8%

Future upgrades/releases

3%

Other costs savings

1%



11

Based on an analysis of the cost savings of the SPARC/Solaris to Windows Server and SQL Server

migration, following are the key points:

There are a substantial number of cost-saving opportunities —fifteen distinct cost-

saving line items quantified in our research —for companies looking to migrate SAP

from SPARC/Solaris to Windows.

The largest single cost-saving line item results from the reduction in SAP/OS

Administration labor at 14% of total five-year cost savings. In nearly all cases, companies

were able to reduce the headcount required to support the SAP installation and

leverage staffing from other IT projects.

OS Software support/maintenance (12% of total five-year cost savings) and hardware

support/maintenance (8% of total five-year cost savings) collectively represent the

largest reduction in cost (20%) and are related to the fact that companies are able to

retire expensive SPARC hardware with costly annual hardware and OS software support

agreements.

The savings associated with migration of the database are also very significant, including

$239K in savings in DBMS support/maintenance and $180K in Database Administration

Labor.

“We can save a huge amount on the UNIX box; the licensing fees and the Oracle licensing are more costly than the SQL Server licensing and the management cost is also a factor. In summary, migration of an SAP/ERP to Microsoft SQL Server provides a rapid return on investment and persuasive ongoing cost savings.”

- $1B Telecommunications Firm

“In the past, SAP just ran better on Solaris, but we found that the efficiencies gained from migrating to Windows now made it worthwhile. The cost of Solaris was going up, the cost of SPARC support was going up and, after doing some testing, the Windows version was able to handle it.”


“From an immediate perspective, being able to eliminate 3 positions was a huge cost saving. Longer term, it is having consolidated servers and having the same consistent licensing across our locations.”

- $1B Wholesaler



12

“We did not have a uniform system or a centralized system beforehand; so, naturally, when we went to a centralized system that was more uniform and more standard across the company, we had a lot more usage; I would probably estimate the additional usage at 20%.”

- $1B Wholesaler

5. Migration Value Drivers

Figure 8 presents the average migration business value drivers based on the SAP Migration

project along with the percentage of the five-year benefit for each cost line item:

Figure 8. Business Value Summary for SAP migration from SPARC/Solaris to Windows

Business Value Driver Line Item

Value (5YR)

% of 5YR Value


$477,435 15%

Increase in user adoption of SAP

$502,563 22%

Process or cycle time savings/value (order entry)

$505,451 19%

Total (actual; not NPV)

$1,485,450 100%

Among the participants interviewed, the three key value drivers that were consistent

across the SPARC/Solaris to Windows Server migration participants were increased

availability, increased SAP user adoption, and improvements in key financial processes

such as order entry. These three elements have roughly an equal impact on total five-

year business value.

The improvement in the order entry process cycle time ranged from 9 - 20%, with an

average improvement of 15%. This positively impacts the OrderToCash business process

and has direct economic implications in terms of time to cash. A 15% cycle-time

improvement in the process can equate to over $500K in value based on the time value

of money.

Based on the performance and ease of use of the Windows Server-based SAP

deployment, all of the interviewees cited an increase in user adoption after migration.

The value associated with this is primarily the leverage of existing licenses.


32%

Increase in user adoption

of SAP 34%

Process or cycle time

savings/value (order entry)

34%



13

All of the interviewees cited an improvement in unplanned downtime which has direct

implications on business value, by eliminating the disruption to core financial and

human resource business processes and reducing lost revenue for customer and partner

facing applications.

6. Strategic OS Migration Drivers

Figure 9 presents the average rank order of the strategic migration benefits based on the SAP

migration project. Participants were asked to rank a set of six strategic migration drivers from

most impact (rank 1) to least impact (rank 6). The top two ranked items – competitiveness and

business agility – are of particular business value that spans beyond the IT organization and

affects the entire organization. In addition to those listed, there were others cited by

interviewees including the strategic value of collaboration.

Figure 9. Strategic Drivers for Migration of SAP from SPARC/Solaris

“Collaboration was probably one of the other strategic benefits, using SharePoint Server in conjunction with the CRM processes; we definitely see a lot more efficiency from the end users.”

- $1B Wholesaler

2.75 3.00

3.25 3.75 3.75

4.50

1.00 2.00 3.00 4.00 5.00 6.00

CompetitivenessOverall business agility / time to market

Predictability of costsAccess to IT resources

IT standardization / IT best practice approachReduction in risk

Strategic Migration Drivers Average rank (1 = highest impact)

“Cost savings are not the only motivation to migrate. The resulting landscape is more reliable and scalable, with less unplanned downtime.”

- $1B Telecommunications Firm



14

Migrating to Windows Server vs. Linux As discussed in earlier sections of this paper, a smaller portion of companies have chosen to

migrate SAP from SPARC/Solaris to Linux as compared to Windows Server. Our study included

several companies that performed a migration to Linux and, as a result, we evaluated the

relative costs and benefit s of a migration to Linux vis-à-vis a migration to Windows Server.

Table 2 presents the summary return on investment analysis for a migration from SPARC/Solaris

to Linux. While SPARC/Solaris to Linux migration investment is comparable to that of Windows

Server migration, it does not provide nearly the level of cost savings and business value as

compared to the migration to Windows Server.

Table 2. SAP SPARC/Solaris to Linux Server Economic Summary

Business Case Summary

Migration Cost (Investment) $669,633

Cost Savings (NPV* of Cash Flows) $1,022,524

Business Value (NPV* of Cash Flows) $873,966

Five Year Benefits (NPV*) $1,986,491

Net Benefit (Return Less Investment) $1,226,858

Return On Investment 183%

Estimated Payback (Months) 21

*Discount rate for NPV of cash flows = 10%

Figure 10 presents the relative advantage of migration from SPARC/Solaris to Windows Server

(and SQL Server) as compared to Linux as the underlying OS. Based on our research and

analysis:

A migration from SAP on SPARC/Solaris to Windows Server offers a better return on

investment and a shorter payback period than a migration to Linux, an average of 110%

better ROI and a six month shorter payback, respectively.

The five-year cost for a migration to Linux is just slightly less (1%) than a migration to

Windows Server. Despite the server operating system and user access licensing costs for

Windows Server, Linux ongoing subscription support costs are much higher in years two

through five.

A migration to Windows Server has the potential to improve cost savings by 53% over a

migration to Linux. The key areas where a migration to Windows Server provides cost

savings advantages over Linux are Administration Labor (OS and DBMS), Database

Software Support/Maintenance and Platform Leverage. A migration to Linux does not

offer the opportunity for savings from migration of the underlying SAP database and

does not offer a significant savings in OS administration staffing cost because a

migration to Linux does not present a significant staffing skill-level transition.

A migration to Windows Server also provides potential advantages for business value

generation. Based on our analysis, a migration to Windows Server can improve business

value by 25% vis-à-vis a migration to Linux over five years.



15

Figure 10. Comparing an SAP migration to Windows Server vs. Linux

Migration Migration Cost (Investment)

Cost Savings

Business Value

5YR ROI Potential

Expected Payback

SPARC/Solaris to Windows Server

$675,407 $1,561,618 $1,092,458 293% 15 Months

SPARC/Solaris to Linux

$669,633 $1,022,524 $873,966 183% 21 Months

$675,407

$1,561,618

$1,092,458

$669,633

$1,022,524 $873,966

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000

Migration Cost(Investment)

Cost Savings Business Value

Five Year SAP OS Migration Cost/Benefit Summary Comparing Windows Server vs. Linux as target migration platform

SPARC/Solaris to Windows Server SPARC/Solaris to Linux

6 Months 9 Months 12 Months 15 Months 18 Months 21 Months 24 Months

SPARC/Solaris to Windows Server

SPARC/Solaris to Linux

Expected SAP/OS Migration Payback Period

SPARC/Solaris to Windows Server SPARC/Solaris to Linux

“No, I didn’t [evaluate Linux]. I do have 2 or 3 Linux boxes out there, but my opinion is that ERP should not be on an open code system for performance, security, peace of mind, and support considerations”.




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Organizations can achieve 110% greater 5-year ROI and a 6-month

faster payback by migrating SAP from SPARC/Solaris to Windows

Server rather than to Linux.

Conclusions and Guidance The Microsoft platform, including Microsoft Windows Server and Microsoft SQL Server, provides

an excellent host for enterprise business applications like SAP. In the not so distant past, an SAP

migration of SPARC/Solaris meant a migration to that platform. Given today’s economics and

the competitive dynamics and trends of server operating systems, organizations are migrating

from Sun’s hardware and software to more open, widely deployed and assuredly long term

solutions. They are doing so because there are substantial quantitative and strategic

advantages, as evidenced in both Pique Solutions’ prior and current primary research. Based on

Pique Solutions’ 2009 survey research of firms who have migrated from UNIX, enterprises that

migrated to Windows Server ranked the benefits they achieved higher than enterprises that

migrated to Linux in 92% of cases.

As the analysis in this paper has

demonstrated, the cost savings and value

generated from a migration from SAP

running on SPARC/Solaris to Windows

Server are compelling in absolute terms as

well as well as relative to a migration to

Linux.

In addition to the economic and strategic

reasons for migrating from Sun Solaris, the

issue of risk mitigation is also of importance. Oracle’s pending acquisition of Sun Microsystems,

heading toward a potentially lengthy dispute with the European Commission, presents many

uncertainties as to the future of Sun products, and creates unnecessary risks for companies tied

to Solaris and SPARC.

Based on the results of this study, those organizations running SAP on Sun’s hardware and

software would be well served to:

Evaluate their current cost profile for the SPARC/Solaris SAP installation and determine

the future year cost increases based on aging hardware and software;

Analyze new hardware options that may offer dramatic price/performance increases

and environmental cost savings over existing hardware, including servers utilizing multi-

core processors from Intel and AMD;

Look at the opportunity to not just migrate the SAP applications to a new operating

system and server platform, but also the underlying database housing the SAP data;

Consider an operating system migration to Windows Server if evaluating an upgrade

from a previous version to a new version of SAP;

Compare the costs and benefits of a migration to Windows Server and SQL Server to a

migration to Linux, utilizing a similar framework as presented here that incorporates a

broad range of cost of ownership, business value and strategic considerations; and

Analyze and monitor risks associated with the uncertainty around Sun Solaris created by

the pending acquisition of Sun by Oracle.



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Appendix A: Description of Cost and Benefit Drivers

Table 3. SAP OS/DBMS Migration Cost Drivers

Cost Category Description

Planning Planning costs prior to migration

Migration Implementation(internal) Internal labor for migration activities including installation,

configuration and testing

Migration Implementation (3rd party) 3rd party labor for migration activities including installation,

configuration and testing

Training Training investment for new OS platform

Hardware costs New hardware purchased for the SAP migration

Server OS licensing costs Server OS licensing costs and user access costs

New server OS support fees On-going server OS support costs (annual)

Database licensing costs Licensing costs for new database/database migration (if applicable)

Other costs: travel Travel costs associated with migration

Other costs: admin/miscellaneous Admin/miscellaneous costs associated with migration

Table 4. Migration Cost Savings

Cost Savings Category Description

Software license (growth) Consolidation, virtualization and increased performance potentially reduce

ERP and related server application software licensing fees

Hardware support/maintenance SPARC retirement, consolidation, virtualization potentially reduce ERP

hardware footprint and retire legacy hardware support agreements

OS Software support/

maintenance

Solaris retirement, consolidation, virtualization potentially reduce ERP

software footprint and retire legacy software support agreements

DBMS Software support/

maintenance

Database retirement, consolidation, virtualization potentially reduce

database software footprint and retire legacy software support agreements

Management/monitoring

software

Potential elimination of 3rd party management/monitoring software &

associated support agreements

Infrastructure software Potential elimination of 3rd party infrastructure software & support

agreements

SAP/OS Administration labor Savings in OS administration/mgmt efficiency; lower headcount and better

leverage for infrastructure stack

SAP Database Administration

labor

Savings in DBMS administration/mgmt efficiency; lower headcount and

better leverage for infrastructure stack

SAP Operations labor Savings in operations efficiency; lower headcount and better leverage for

infrastructure stack

SAP Help desk labor Savings from fewer support calls to help desk; better skill leverage for help

desk (no need for specialized training)

Remote/extended workforce

enablement

Savings to support remote/extended workforce; WS08 provides more

automated tools for provisioning remote workers

Environmental (power/cooling) Savings associated with consolidation/better hardware performance

(reduced space, power and cooling costs)

Platform leverage (integration,

collaboration, BI, etc)

Savings associated with leveraging Windows infrastructure (collaboration,

business intelligence, desktop OS, etc.)

Future upgrades/releases Savings associated with OS upgrades/major releases



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Table 5. Migration Business Value Drivers

Business Value Category Description

Availability-related value

improvement Business value advantage based on the increased availability

Increase in user adoption of SAP Business value of increased adoption rates of SAP and use of licenses

previously purchased

Process or cycle time

savings/value

Certain business processes are completed faster resulting in process specific

business value

Table 6. Strategic Business Value Drivers

Strategic Drivers Description

Competitiveness Improvements in ERP after migration improve the competitive position of a

company, particularly as it relates to supply and demand chain improvements

Overall business agility / time to

market

As ERP is a mission-critical element of the application infrastructure, time to

market advantages in deployment can translate into enterprise level time to

market advantages

Predictability of costs Microsoft licensing, software assurance and support policies provide long

term predictability of IT costs

Access to IT resources Access to a broader and more affordable skill base of employees and certified

partners

IT standardization / IT best

practice approach

Standardizing more of the IT infrastructure on Windows Server enables more

consistency in the application of best practices for IT

Reduction in risk

UNIX and Linux infrastructures, by nature, have a high degree of tailoring and

customization which can introduce risk in terms of staffing, agility and IT

management

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Documents

Pique Solutions Solaris to Windows Server Migration White Paper