I’ll give you a minute to think.
Can you name three? Four? Your average SAP customer might list “employee,” “limited professional,” “professional,” or even “employee self service,” but these types are just a few of the wide range of licenses out there. The problem with not knowing your SAP license
options isn’t a matter of user pride, though - it can cost your company a lot in unnecessary fees and restrict your negotiating power with SAP.
Fortunately, a little bit of extra knowledge can go a long way in upping your leverage when it comes to your SAP contracts. This blog post will give you a five-minute crash course on SAP license varieties and give you tips on how to negotiate the best setup for your unique company and keep costs down.
First, let’s look at the three main categories of SAP licenses: 1. Licenses for separate, individual applications 2. External applications migrated to SAP, and 3. Combined SAP application licenses.
Category 1 Licenses: Separate, individual applications
If you need specific licenses for single applications, you fit into this category. Let’s say you have remote employees that regularly need to log onto a portal, but don’t need global licenses for other SAP applications. In this case, you would buy individual portal licenses for your users.
Category 2 Licenses: External applications migrated to SAP
If you were a customer of a third party application, like BusinessObjects for example, which was later acquired by SAP, your licenses are in this category. In this situation, the terms of your license remain as they were when you signed with the original application, and only switch over to SAP terms if or when SAP integrates them into their routine license types.
Category 3 Licenses: Combined SAP applications
Traditional SAP users fit primarily into this category, as it includes the most basic license types such as “employee,” “limited professional,” and “professional.” These are all global licenses for large product suites such as SAP APO, SAP CRM, SAP ERP, and SAP Business Data Warehouse (or BI). Each license is for a single employee, who can then use any of the products the individual license covers.
Most licenses you’ll need to work with fit into these three categories, but you can always review an exhaustive list of SAP’s license types in their official guide.
Now that you have the basics, we’ve assembled some of our top strategies for optimizing your SAP licenses and not falling prey to some common licensing mistakes.
5 tips for getting the most out of your SAP licenses:
1) Re-sell (and buy) unused licenses: This surprises many people, but as of a 2013 German court ruling, you can re-sell SAP licenses you haven’t used. This could - and should - save your company big and drastically alter your licensing budget. This also means that you can buy unused licenses from others; an unused pre-owned license, unlike other products, really is ‘good-as-new,’ so there’s no reason not to save on the ticket price here.
2) Notice and avoid indirect use: Since 2013, SAP has been highly particular about indirect use and if you’re not aware of how users are using your SAP indirectly, it could be a major costly error for you in your next audit. Software like LicenseAuditor and Profile Tailor make it easy to track your usage and prevent unintentional indirect use by automatically classifying users who have accessed SAP indirectly.
3) Define special licenses meticulously: Sometimes, local SAP offices invent special license types for specific companies, like “safety” or “power-user” or “management.” Since these are unique licenses and do not fit into the official categories, there are no definitions for them in SAP guides. Make sure you carefully define each special license specifically. For example, a “power-user” might be the license of an employee who uses more than 10,000 dialogue steps per month in a single SAP system. A clear definition like this prevents later argument about the license and enables you to purchase more similar licenses if you need them later.
4) Scrutinize and optimize your licenses: Before your next audit, make sure to closely inspect your licenses, eliminate unused licenses, and reclassify suboptimal license types. Unused and unoptimized licenses are a waste of money and an audit risk, so prune and adjust these immediately so that your licensing setup is precisely right for your business’s situation and growth.
5) Use your knowledge as power in negotiation: Now that you know that there are many more license types than the basic ones, you can use this knowledge when negotiating with your local SAP representative. Nothing is set in stone - you can ask for a more specific type of license or, in some cases, have a special license created just for your unique situation. And now that you can buy ‘pre-owned’ licenses, remember that buying directly from SAP is not the only game in town, which strengthens your negotiating position.
Some items on this list you can address right now and immediately see results. Others are easier with help. If you have any concerns about your SAP licensing, feel free to reach out. Xpandion is the world leader in SAP license optimization software, and we’ll be happy to answer any questions you may have.
Contact us HERE before your next audit and get your company's licenses optimized