Many organizations use SAP for their ERP requirements are it helps organizations integrate multiple business functions. The largest expense associated with SAP implementation is the licensing cost, as many companies do not optimize their SAP licenses. Two important challenges that organizations face in this regard are selection of the right category of license, and managing their existing licenses effectively. The complexity of managing licenses increases with an increase in SAP systems and users within the organization.
Every year, SAP conducts an audit of your SAP software licenses, to compare license against utilization. Most companies find themselves falling short of SAP requirements as they do not properly categorize their licenses as per audit and compliance agreements. Optimus by ToggleNow is an SAP license optimization and auditing service which takes your holistic requirements into consideration when designing a comprehensive plan to address all your SAP licensing needs.
8 out of 10 organizations lack the right expertise or tools to evaluate their SAP Licenses and thus often trapped into unexpected Licensing audits. Remember, periodic auditing of SAP licensing usage will not only help you to be compliant, but also saves huge on SAP licensing costs. Here is what to optimize:
Direct or Named User Licenses
Most organizations find their lack of SAP user licensing only after looking at their USMM reports, and they do a guesswork to complete the LAW reporting. It's a myth that user license categorization is based on what is assigned rather than what is utilized. It's just a guesswork to complete the SAP USMM reports. At ToggleNow, we use real-time data analysis to identify the right category of SAP license required to ensure that your organization is audit ready and have all the data points ready for your review before submitting the LAW report.
Full User Equivalent (FUE)
FUE is the new licensing model for S/4 HANA Cloud. FUE is an easy and flexible user model for enterprises to allocate advanced, core, and self-service use of SAP S/4 HANA users. With the model, customer may allocate each FUE to any one of the use package types and may change the allocation during the subscription term. ToggleNow’s expertise in identifying the right FUE packages. If you are upgrading to SAP S/4 HANA cloud and need our expert advice, we are a call/mail away. Talk to our SAP Licensing Experts to know more about it.
Indirect Usage
If you're using third party interfaces, it may be more complex to acquire the right licenses. In 2018, SAP announced a new licensing policy for third party usage called Digital Access. Any third-party system access that results in additional licensing must be periodically reviewed and streamlined. With ToggleNow’s Optimus service, you identify critical and noncritical indirect usage in SAP systems. We ensure that the right requirements of digital access packs are licensed to make sure that your organization is compliant with SAP licensing guidelines.
With Optimus, you will gain control over SAP licenses and be audit-ready. It gives you all the inputs for an SAP Licensing audit.
Optimus does a 4-level scan and finds the most appropriate license type based on the activity and not by assignment.
With Optimus, one can avoid any hidden costs associated with named user, indirect usage and engine-based licenses.
If you are migrating to SAP S/4 HANA, it’s time for you to review the existing licenses and go with the right license packs.
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There are 2 types of licensing audits; Self-declaration (which is normally performed annually) and an Enhanced SAP License Audit, which SAP conducts providing a notice. A self-declaration is where the customers review their licenses, update them and upload to SAP for review. Generally termed as USMM, or SLAW submission.
SAP sends out a measurement request when the self-declaration is due. At this point in time, they will mention the SAP systems and products that needs to be measured as a part of the audit. However, note that the JAVA based systems are not part of it. Some of the SAP products have to be reviewed and measured separately.
Certainly not, SAP may not review every single annual license audit submission in-detail. However, SAP will consider various parameters and when SAP identifies that a detailed audit is required, it may trigger an enhanced SAP license audit. Note that you have to be ready with all the data points to answer SAP on the usage.
ToggleNow with its rich expertise and partnerships provide an enhanced SAP License Audit with skilled auditors performing more targeted analysis. Our experts does a 4 level scanning to unearthen the undiscovered risks that are not visible in a standard SAP License Audit Workbench (SLAW) audit. Further, you will have a completely visibility on the usage.
We suggest you to check SAP’s own Licensing Guide that says “Audit tools cannot determine if a customer falls within the scope specified by their software license. Measuring the usage of SAP software is something customers are obliged to do according to their SAP license contract”. Accordingly, our Licensing Auditors advise customers to know their usage, right things etc., and be compliant rather than relying on the SAP License Audit Workbench results!
Not exactly. The Licensing measurement tool is used to collect audit data from the customers SAP systems and submit it to SAP after necessary correction. It is primarily a data collection tool and doesn't give any transparency on usage or licensing costs to actively manage licenses and configurations. This is where ToggleNow's Optimus service helps!
Usually, our license optimization projects need as little as 2 weeks. We just need to understand your current licensing contracts, requirements etc., The goal of this two-week license optimization project is to pull all of your licensing data together and determine if you can reduce risks and expected costs through improved license allocations.
Of course, Optimus gives a view on several elements when classifying the SAP users such as by usage, by assignments, by activity and so on. As per the SAP Licensing Guide, the classification should be always based on the amount of User activity and that is what Optimus does in short. Further, you can write-back the values in a click.