Research shows that 8 out of 10 organizations overpay SAP due to poorly designed authorization structures. This issue went largely unnoticed until SAP introduced its STAR analysis, shedding light on the inefficiencies in user access management. By leveraging this insight, companies can significantly reduce SAP licensing costs by redesigning roles and realigning user access. This strategic approach not only reduces unnecessary expenses but also enhances compliance and strengthens SAP security. SAP role redesign plays a pivotal role in achieving these outcomes to streamline the process.
The Hidden Cost of Inefficient Role Design
AP licensing is determined by authorization assignments and, in turn, the definitions and authorizations, where excessive transaction codes or overly broad access often push users into higher licensing categories. Organizations frequently incur inflated licensing costs due to poorly structured roles that grant unnecessary access to high-cost authorizations. For instance, a user needing basic reporting access may be assigned a role with permissions with wider access, such as value in the object, driving up licensing expenses.
This misalignment typically arises from outdated role designs, limited visibility into actual user activity, and inadequate governance over role assignments. Over time, such inefficiencies compound, creating significant financial strain for enterprises. Here is an overview of how incorrect maintenance will lead to a higher licensing category:
There are 160k+ transaction codes with 700k Authorization Objects. Is it possible to manually validated each of them?
Role Redesign: The Game Changer
As mentioned, SAP licensing is one of the most significant expenses for enterprises, often inflated due to misaligned authorization design. Contrary to popular belief, licensing costs are not determined by how users utilize the system but by the design of their authorizations. Roles with excessive transaction codes or overly broad permissions often result in users being assigned to higher licensing categories than necessary. SAP role redesign focused on optimizing authorization design is the solution to mitigate these costs while ensuring compliance and system security.
The Critical Role of Authorization Design
SAP role redesign isn’t just about cutting down access—it’s about strategically aligning user roles with business requirements and SAP’s licensing policies. A well-executed redesign ensures that authorizations are tailored to the tasks users perform, avoiding unnecessary licensing costs.
Here’s how SAP role redesign works to optimize licensing:
1. Task-Based Role Definition: Broad, catch-all roles often include transaction codes and permissions that push users into higher license categories. By redesigning roles based on specific tasks and job functions, organizations can restrict access to essential features, ensuring users are assigned the most cost-effective license tier.
2. Segregation of Authorizations: Aligning roles to Segregation of Duties (SoD) is crucial for preventing conflicts of authorizations and ensuring compliance with regulatory standards. By designing roles that clearly separate critical tasks—such as approval and execution—organizations can mitigate the risk of fraud, errors, and unauthorized actions. This alignment not only strengthens security but also enhances audit readiness and operational transparency.
3. Minimizing Broad Authorizations: Roles that include access to high-cost transactions and authorizations inadvertently escalate licensing costs. By limiting these authorizations to only those users who genuinely require them, organizations can stay within optimal licensing thresholds.
4. Simplified Role Structures: By eliminating unnecessary complexity in roles, organizations achieve better control over user access. This simplification makes it easier to monitor and maintain compliance, further optimizing licensing costs.
Real-World Success
A multinational company discovered that more than 70% of its users were over-licensed due to outdated role designs. The roles granted excessive access to transactions and modules that most users didn’t need. After a comprehensive analysis and adapting to ToggleNow’s S.M.A.R.T authorization design methodology, our client:
- Reduced annual SAP licensing costs by around 40%.
- Improved compliance with regulatory standards.
- Enhanced security by aligning access with business requirements.
By leveraging SAP role redesign, this organization achieved remarkable cost savings and operational improvements.
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Conclusion: Unlocking Cost Savings
Redesigning roles in SAP is a practical and impactful way to reduce SAP licensing costs. It not only optimizes costs but also enhances security and compliance. In an era where every dollar counts, organizations must leverage such strategies to maximize ROI from their SAP investments.
Investing in SAP role redesign is not just a cost-saving measure; it’s a step toward a smarter and more secure SAP environment.
