By Matt Schaefer
We often discuss the concept of optimization of our SAP assets as if it is well understood, but what are we really talking about? There are essentially three aspects of SAP optimization that need consideration:
- License
- Process
- Vendor Relationship
The License aspect considers the license position based on what was purchased versus what is consumed. There is some complexity that exists when taking into account the mix of SAP licenses that the organization is consuming (e.g. Developer, Professional, Limited Professional, Employee, etc.). Investigating what this license type 'mix' should be requires that your organization understand how users are utilizing the SAP landscape. At a minimum, what transactions are users executing, how long are they in the environment, and how often between sessions do users log-in are questions that must be answered if you are to pick the most effective license type for each user based on their actual business use of SAP. This is important because customers tend to allocate the Professional level license to be sure their users are 'covered' no matter what they do in the system or systems. This can become a costly insurance policy that can be easily avoided with an appropriate software license optimization solution that can automate this calculation across the multi-system SAP environment.
The Process aspect considers the ability to replicate the set of the tasks necessary to repeatedly calculate your SAP license position. All too often SAP owners/users/practitioners do not consider the value of the amount of time and resources that go into the above. They believe that some version of custom reports and spreadsheets is enough (or if they realize it’s not enough, they believe it’s all they can do). The problem that occurs is that manually creating this license view is not only operationally expensive but it keeps organizations from accurately understanding their usage and truly making the leap to license optimization. The sheer effort required from the manual approach forces them to 'get by' and 'survive' audits rather than maximize return on investment from their systems landscape. Software license optimization tools that bring automation to bear on SAP license management can streamline the process and dramatically improve results.
The Process perspective should also look outside of just SAP and holistically consider optimization of the entire software estate, of which SAP is just a part. Standardization of software asset management processes across the enterprise enables the centralization of reporting as well as streamlining vendor management communication internally between executives, IT, Procurement, and Legal. (And this allows a more strategic and “in the driver’s seat” positioning with suppliers!) For instance, the procurement group may want to focus their negotiation efforts on ‘parking’ language or remixing of licenses rather than drive for discounts for licenses they don’t even realize they don’t need. (Another way of saying that, is if you get a 50% discount but only use half the licenses you purchased….then you paid full price.) The key is organizations have to know how to get the most value from their systems, contracts and vendors. This process view focuses on getting the right information to the right people at the right time in an efficient and repeatable way to make more informed business decisions.
The Vendor Relationship is the culmination of the execution of the two previous optimization areas. This aspect considers what the relationship should be with a vendor— in this case SAP. It is being able to categorize them (e.g. are they a strategic partner?) and come to the appropriate value terms in an unequivocal and precise way. When it comes to vendor relationships, hostility is bred from ambiguity. It’s only when both parties can consistently understand and agree to the terms of value that the relationship's focus changes its posture from defensive to collaborative with a focus on strategic growth (for example, a shift from— I want x (feature) to— how can you help me achieve y (outcome)).
A common example of this is getting SAP to define the 'Limited' in the Limited Professional license type so it is relevant and valuable to your organization. Once this is established, the conversation can shift from defining features to how they can be leveraged. This is beneficial for SAP as well, as it gives their customers the ability to know and appreciate the value based business they have historically done with the vendor. It allows customers to have the confidence to re-invest their savings with SAP, broadening the SAP technology footprint in their landscapes.
So optimization means being able to accurately know how you are consuming and leveraging SAP assets, applying a strategic direction to that information and putting it in the hands of the people to nurture the relationship with specific value based goals as the framework for your collaboration with SAP.
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To learn more about optimizing SAP licenses, please view our on-demand webinar: SAP Software Licenses Could be Costing You