SAP Policy Changes Extend Software License Optimization Benefits

By Chris Hughes

SAP has announced its 2nd software licensing policy change within a month aimed at delivering newfound flexibility to customers whose business requirements have changed. These changes also provide organizations additional options to more readily monetize the outcomes of Software License Optimization investments.

The recently announced cloud policy extension entitles SAP customers to replace on-premises licenses and maintenance with a cloud subscription, albeit requiring an expanded investment and a 5 year contractual term. Similarly, the new on-premises policy extension enables customers to re-purpose a portion of their licenses and maintenance towards other on-premises solutions such as in-memory computing and mobile. Additionally, customers are now permitted to terminate unused licenses, although the maintenance costs for the remaining licenses are re-calculated based on the standard discount level of the remaining license quantity. In no case will the maintenance bill increase in this scenario, however.

There are a range of proven techniques for optimizing the consumption of SAP named user licenses including the detection and retirement of inactive user accounts, detection and resolution of unnecessary duplicate users and optimization of license type assignments based on real usage data. Conversely, the system measurements used to generate the SAP License Administration Workbench (LAW) report do not adequately uncover inactive and duplicate users. Nor do these measurements optimize named user license types; they only tell you how many of each license category you have deployed. That’s why you need an automated SAP license management solution capable of performing these optimizations.

SAP license optimizations typically yield a significant license surplus. Named user license type optimization frequently results in a surplus of high cost licenses (e.g. Developer, Professional, and Limited Professional User licenses). These license surpluses can be used to offset additional license requirements and reduce future license and maintenance purchases.

However, for organizations whose future license requirements are not expected to grow, until now the only sure way to reduce ongoing maintenance costs has been to retire all their licenses and re-purchase a smaller amount, with the timeframe for a positive return on investment (ROI) largely dependent on the discount given for the new license purchases.
SAP’s policy changes open up several new opportunities for enterprises to transform their unused SAP licenses into cost savings for their business. From subsidizing the costs of implementing new SAP cloud and on-premise solutions to reducing ongoing maintenance costs, there has never been a better time to reap the rewards of SAP Software License Optimization.

Learn more about SAP Software License Optimization by viewing our on-demand webinar: SAP Software Licenses Could be Costing You.



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