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SAP licensing challenge

Select the appropriate user types for your organisation

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Software licence management is a painful exercise for most enterprises - the challenges are never the same across software vendors, and organisations have to painstakingly adhere to the complexities of licensing models of the individual software vendors to be in an ‘overall’ state of compliance.

Furthermore, each vendor poses unique challenges to enterprises’ optimisation of software spend.

Looking specifically at SAP, the key to licence compliance and spend management lies in measuring usage of the software and assigning the appropriate user licence type based on that usage. But employee turnover, ever changing system usage, and SAP licence model complexity make this process difficult. Let’s look at the particular problem areas:

Licence types
SAP licensing is user based with multiple categories of users including developer, professional, limited professional, employee and employee self service. The definitions of these licence categories are vague, making the proper classification of users based on their use of the software and on their role in the business very difficult.

For instance, a ‘professional’ user is a named user who is authorised to perform operational and system administration/management roles supported by the licenced software. And a ‘limited professional’ user is a named user who is authorised to perform “limited” operational roles supported by the licenced software. The distinction between these two classes of users is fuzzy to say the least.

Because of this ambiguity, inadvertent misclassification of users for licence type allocation can prove costly for enterprises. There are major differences in the licence cost for the various user categories. Each licence type also carries with it different terms and conditions for use.

Direct and indirect users
SAP requires enterprises to allocate licences for all users including direct and indirect users of the software (this includes external systems interacting with the SAP software). This level of information is extremely difficult to ascertain manually, and the inability to accurately and credibly do so can potentially cost enterprises millions of pounds in unforeseen licensing expenses.

The Licence Administration Workbench (LAW)
SAP provides enterprises with LAW - it’s a measurement tool, to enable customers to list all the users of the SAP systems and match the corresponding licence type allocated to each user. Based on the findings of the LAW report, SAP decides whether or not enterprises are under or over-licenced.

Accurately classifying users (direct or indirect users) and allocating the right licence type to them is crucial for enterprises to ensure an optimised licence state. And this must be done prior to executing the measurement system through the LAW report. There is no provision in the LAW report to help with this exercise - the onus of the accuracy of user classification rests entirely with system administrators and would have to be done manually based on the SAP system functionality. This makes it a complicated and very time consuming, administrative task.

SAP engines
Over and above the end-user based licensing model, SAP’s engines model is even more complex, making it easier for enterprises to fall out of compliance. This licensing model uses different licence usage metrics, which are based on actual data created in the SAP systems. For example, for SAP Payroll Processing, the number of master records in the system is used as a licensing metric, but for SAP e-Recruiting, the metric used is number of employees.

By adopting Enterprise Licence Optimisation tools, also known as next-generation software asset management solutions, enterprises can optimise their SAP system usage, ensure accurate licensing and maintain usage-based spending on an ongoing basis.

Such solutions automatically track the SAP usage of each user, determine whether the correct licence type has been allocated to every user and whether enough licences are available for a given type. This automatic user classification is based on live usage data, and so takes out the guess work as well as eliminates the inadvertent licence allocation mistakes.

Posted by Vincent Smyth, General Manager, Flexera Software EMEA

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