SAP License cost consumes most of the IT budget to any SAP customer. Also, the risk of facing SAP License auditing is an ongoing challenge for any SAP customer despite expensive IT budget allocation to SAP software.
The research says that many SAP customers are NOT using 100% of their SAP License but ends up with paying additional licenses over the time due to hiring, mergers & acquisitions. This is mainly due to lack of understanding such as how SAP Licensing works and License compliance expectations from SAP.
Many software publishers do charge their License based on “one software installation equals one user license”. This limited understanding about SAP User License which is for sure to invite SAP License auditing in the near future. Efficient management of SAP License requires an in-depth understanding of SAP Licensing works & which is more complicated than IRS tax publications.
When it comes to SAP License, It charges a different price for various named user license types. For example, the customer pays more for Developer License type than Information user license type. If SAP customer does not manage their active Developers count correctly, they would end up paying thousands of dollars unnecessarily. Same is true for Professional License type which is next pricier to Developer License.
SAP requires customers to perform system License measurement yearly using transaction codes like USMM and SLAW in the SAP system. These transaction codes are designed in favor of SAP to count/submit the actual License volume at every customer site. Once SAP receives USMM / SLAW information that would enable SAP to send an invoice for additional Licenses when SAP customer exceeds their allowed License count.
The first tip is that never submit the result of USMM / SLAW (License Administration Workbench) without cleaning up your dormant users from entire SAP Landscape to SAP. Example for Dormant users are casual users, duplicate users, and active users but never logged into SAP system. These users contribute up to 20% of your total SAP License volume.
The second tip is to make sure that terminated employees do not exist with active SAP user id in the SAP system.
The third tip is to assign a precise License type to every SAP user based on their activity in SAP system. Some users may not need expensive Professional License type that would result into License savings when assigned them to the lowest license type like ESS User. This can be possible only when you look at their executed transaction codes for an entire year.
USMM / SLAW collect a volume of business activity from every business module which is called Managed engine. These engines show how many sales orders, PO orders are created in the system which is entitled to Managed Engine License. When a customer buys software from SAP, they agreed to pay a license fee on Managed Engines when a customer exceeds their allowed volume in which SAP strike an initial Licensing deal. Some Engine usage data is the result of the proof of concept (POC) rather than real business activity. The fourth tip is to verify the accuracy of these Managed Engines usage data to justify the business purpose before submitting to SAP.
Finally, the recent high-profile cases of license dispute on Indirect usage data requires a good understanding of Indirect usage and how it affects your organization. SAP is licensed on a per-user basis. So, the fifth tip is to look at your indirect usage data and their business purpose before submitting to SAP. Indirect usage means any 3rd party application either reads data From or sends data to SAP system.
For Example, Salesforce CRM application at customer site reads their customer details from SAP system which is considered to be Indirect usage data.
SAP recently introduced volume-based pricing which is appealing to some customers based on their business. So, it is better to understand the benefits of volume-based pricing versus named user license scenarios. This is not new to IT depts as many Software publishers charge their license based on no of connections made to their system.
The final tip is that every SAP customer should use some kind of a Software asset management tracking tool like AuditBots SAP License Saver which automated all of the above tips with a guarantee of up to 40% License savings for their SAP Landscape. Please visit AuditBOT at www.auditbots.com