Too many organisations see their annual SAP licence audit submission as a technical process that is undertaken without senior management, contractual or commercial scrutiny of the final submission. 

It is typically left to the last minute - and then BANG! - an invoice arrives for often hundreds of thousands, or sometimes millions of pounds, with a demand to pay it within a matter of weeks.

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In this third part of our series of articles about SAP Licence Audits we answer the question of what is SAP Licence Optimisation and why is it the single most important thing you can do prior to an SAP licence audit?

We can break this down into the four main stages of a licence optimisation process;

(1) Firstly, it tells you EXACTLY where you are in terms of your current licence compliance - i.e. What licences, and of what types, do have deployed and allocated right now vs. what I have purchased from SAP.

Why is this important? Your usage rights form the backbone of your SAP contract and this is what the SAP licence compliance team will focus their audit on. If you have over allocated named user licences, exceeded the usage metrics of your application or engine licences, or have third party systems directly accessing your SAP core then you will be liable for true-up charges. These are often very high, unexpected and thus unbudgeted, and usually stipulate a very short payment deadline.

True-up SAP licence fees are often very high, unexpected and thus unbudgeted, and usually stipulate a very short payment deadline.

(2) Second comes the licence optimisation process itself. Our experience has proven many times that most named users in your SAP system will be granted ‘Usage Rights’ that far exceed their ‘Actual Usage’ requirements - i.e. they might have a Professional User licence allocated but their actual SAP usage could still be achieved with just a Limited Professional Licence or less.

As well as optimising licence deployment based upon usage, this step is also where we de-allocate duplicate licences across multiple SAP systems (one employee only needs one named licence), release unused licences, and determine underused licences.

This is a sophisticated process that requires equally sophisticated software to achieve accurate results. It is the most important step though because if step (1) determines that you have over allocated or are overusing your licence inventory then this is the step that will minimise any potential exposure - in fact, in our experience it will more often than not completely eradicate any exposure.

Our experience has proven many times that most named users in your SAP system will be granted ‘Usage Rights’ that far exceed their ‘Actual Usage’ requirements

(3) The third stage of the licence optimisation process again uses software to analyse SAP application and engine usage and any third party interfaces that are accessing your SAP core, potentially exposing you to indirect access licence costs. The most advanced software, such as ProfileTailor LicenceAuditor, can also analyse third party system users to determine the exact nature of their indirect access into SAP thus determining what kind of additional licence might be required - perhaps none at all if the third party system user already has an SAP named user licence.

(4) At this point you will have only eradicated, or at least minimised, any true-up licence fee exposure, you will have in your possession some of the most detailed information that you have perhaps ever seen in terms of how your company actually interacts with your SAP systems. This information can provide valuable modelling to take into any new licence agreement discussions, or to understand how alternative licensing options might better suit your business, such as SAP’s Digital Access Licence.

In the next article we will be looking at contract defence and what to do when things go wrong during or after an SAP licence audit

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Grey Monarch and Azurious Limited provide software and expertise in all aspects of SAP Licensing, from licence requirements analysis, licence optimisation, preparations for licence audits and compliance, licence contract management, and compliance defence. Our services are tailored for each organisation and can range from ad-hoc advice to a fully managed service.

Please contact us for a no-obligation exploratory conversation.

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To find out more...

If you need expert assistance in this then why not get in touch with us for an exploratory discussion

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SAP Licence Optimsation and Audit as a Service

Go to LicenseAuditor Web Pages

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