By Matt Schaefer
It's a very common scenario where it is necessary to bring a new SAP system into your SAP software license optimization efforts. This can happen for a variety of reasons-- the scope has broadened to include organizational entities that your SAP scope didn’t previously include; acquisitions, where one company strategically leveraging SAP's technology stack buys/merges with another company using SAP as well; your organization is expanding your SAP footprint and bringing more functionality on line. When addressing these scenarios, it is critical to understand how your SAP licenses and related contractual obligations will be impacted.
Regardless of the reason, it’s important to make sure that you are maximizing your value from the new system. Before bringing this system online or in-house, there are a few things to consider:
- What are the licensing metrics of the new system? Do you pay for the user (license level type) or is it an add-on package based on business metrics like revenue or PO line items? Understanding this metric is key to knowing how this system fits into your SAP license framework.
- How does this 'new' system fit in terms of functionality and usage? If this system is redundant, which mainly occurs in acquisition scenarios, it’s critical to understand existing contract terms and conditions. For example, if you are now considered 'over licensed', does either company have parking language that could be exercised to reduce the cost of ongoing maintenance? Would the SAP license entitlements from one entity transfer to be able to cover the 'under-licensed' entity if that situation occurs? Can you leverage currently owned SAP license entitlements for your new system?
- Will the system be considered Production, QA or a Test environment?
- What is the expected lifecycle of this new system? Is it one that will be rolled into the buying entities’ system or will the two systems operate side by side? Depending on your next SAP audit or true-up, timing could influence what entitlement purchases will or will not be required.
- Can you apply already established business rules for determining what 'usage' is? For instance, will the same types of people / roles access this system, requiring a certain license level, as previously defined? If not, what level of CPU time, executed transactions, logon rate will be considered for establishing the policy for this system based on the named user license levels?
- If users already have logins for another SAP system, will the license entitlement they already have cover usage in this system as well?
- During the discovery/disclosure period of acquisitions, consider performing an SAP software license optimization exercise to be certain the assets and liabilities associated with the system landscape are truly understood.
Many organizations focus on Portfolio Management and Application Lifecycle Management when making the decision to bring in a new system such as SAP, focusing on the features and value that are gained from the system. However, without understanding the overall picture of your SAP landscape, including license and contractual considerations, bringing a new module or system on-line or an acquisition’s system in-house could introduce risk to your overall business case.
Learn more about SAP license optimization by viewing our on-demand webinar: SAP Software Licenses Could be Costing You.