Feb 23, 2017

Magical Staircases in SAP Castle – Part 1

What new licensing surprises await SAP customers in future? What’s clear is that a trend has emerged that’s been expanding since 2014. And it’s taking on ever more ‘creative’ forms: existing customers are finding themselves confronted more and more frequently with unexpected subsequent purchases.

SAM managers suddenly find themselves caught in a wild Harry Potter adventure, desperately struggling to navigate the winding staircases of Hogwarts castle. Is there a way to conquer the constantly changing licensing staircases within the SAP castle? Of course! Bold SAM managers must take their destiny into their own hands, braced for the twists and turns ahead. Here are 3 tips to help you save on SAP licensing costs!

Staircase #1: Terms & Conditions and Prices & Conditions

It’s no secret that SAP likes to change its Terms & Conditions and Prices & Conditions. SAM managers must continuously establish which conditions apply. Which conditions are applicable? Which direction leads to what the customer is actually looking for?

Expert recommendation:

Given the variety of different contracts—without a doubt an unhealthy situation from a legal perspective—the magic word is ‘consolidate’. Agree upon a valid price list with SAP, preferably using an ‘older’ price list since the conditions have become worse over time. This should be carried out with legal assistance.

Staircase #2: The flat rate for non-SAP database usage

The flat rate for non-SAP database usage (e.g. by Oracle) was initially raised from 11% to 15%, then 19% and now to 22%. Accepting this type of flat rate may at first glance appear to be the simplest route, since Oracle then does not measure the databases running within the SAP applications.

Expert recommendation:

Costs may actually be saved by cancelling the database contract with SAP and switching directly to the database provider (e.g. Oracle). This is particularly true if an Oracle full-use license is required without it (keyword: indirect usage). Although it might seem expensive initially, this strategy offers a distinct advantage since it needs to be considered in conjunction with the inevitable switch to the HANA database. When migrating from Oracle to HANA, for example, there is the opportunity to cancel parts of the Oracle databases, meaning both databases (Oracle and HANA) don’t need to be licensed with SAP for the entire duration of the migration, which might be more cost effective in the long run.

Get instant ROI and save 10% on your total licensing spend now!

Staircase #3: SAP engines

There are engines that can be measured and those that cannot. Today, SAP is unable to display the existing variety of metrics. However, it’s working on this by adapting and expanding its standard audit tools. As soon as a new metric can be measured, many companies will suddenly realize that they had not previously licensed the usage—meanwhile, the metrics may have also changed. This means that a metric could be from 2010 (purchase date), but the audit tool is measuring according to the 2016 version. The outcome can only be wrong.

Expert recommendation:

Clarify with SAP which metric applies to you if this is not stated in the contract. Is the right metric being measured with the audit tool? For engines that cannot be measured, self-declaration applies. With a tool-supported measurement, you cannot access this staircase. This is why we recommend LicenseControl for SAP.

In my next article, learn to decipher “SAP Named User Licenses” and “SAP NetWeaver Foundation for Third Party Applications”.

Continue to Part 2


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Topics: License Optimization, SAM Insights, SAP