Recently had a call from an unhappy SAP customer moaning approximately the high expenses of SAP Consulting Service annual protection and questioning whether or not they’re getting an appropriate fee for the money. I’m afraid that this is not a one-off conversation but something that is shooting up regularly nowadays.

The factors main to the dissatisfaction consist of :

1. CIOs are keen to shift spend from boring legacy IT like paying renovation on infrastructure to new, greater interesting stuff. What Forrester calls business generation — that assist win, serve and maintain customers.
2. Difficult financial instances re-attention procurement’s lens lower back directly to the ones huge chunks of money that companies want for maintenance.
3. SAP has been growing maintenance expenses to try to get anyone paying 22% of the net license costs every year.

The cause, the facts remain that SAP’s maintenance costs (like software vendors).  Are a big expense item on many CIOs budgets. 

There are 3 ways which squeeze your maintenance cost are : –

Before you even start negotiating with SAP use a number of the greater recent software asset management gear. That recognizes all SAP’s licensing nuances (together with the now feared ‘indirect get entry to’ issue). To help ease up your SAP property. This may give you a clear photo of what you have got and what you want. It’ll also highlight discrepancies between what you have licensed and what you absolutely need.  Or are you procuring top rate license variants whilst in fact decrease value versions are extra than ok? In different words, so you’ve got too many professional consumer licenses.  When are confined professional licenses more than enough to cover your user’s needs?

If you are planning to buy for greater new software from SAP (e.g, S/4 HANA). Then make certain you integrate your new stuff conversation together with your annual maintenance conversation. SAP will attempt to maintain these conversations separately. However, you need to keep them related we should deal with the entire package deal here. One example I noticed currently become wherein SAP turned into supplying to change unused license renovation fees for new cloud licenses as a way to sweeten the deal and to reduce the net new spend. And if you are trying to leap to SAP’s cloud, then what about getting a trade-in credit in on any on-premise SAP software program you are approximate to update with variations of their cloud?

Have you ever gotten a quote from one of the third party SAP preservation agencies such as Rimini street or Spinnaker guide? Whether or not you select to go with these corporations and save yourselves 50% of the money you currently pay to SAP. Or whether or not you operate them as negotiation leverage. To force SAP to decrease their protection prices is up to you. Third parties are actually making critical in-roads into SAPs client base. And do pose an actual danger to their excessive margin preservation cash cow. And as with any negotiation, it’s exact to have a preference. Because it makes both parties bidding on your commercial enterprise work more difficult.