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Gartner: Reduce Unexpected Licensing Costs With SAP SaaS by Negotiating These Three Critical Terms

As an SAP® customer, you may feel increasing pressure to move your ERP systems to cloud-based platforms. SAP’s changing cloud license models, naming conventions and new products are relatively new to the market. Although adoption rate is still low because companies are just now starting to figure out how to transition to the cloud, it is surely expected to rise.

The challenge is growing exponentially as SAP’s SaaS customer base grows. According to Gartner, “Proposal reviews for Concur, Ariba, Hybris, SuccessFactors, C/4HANA and SAP S/4HANA Cloud (Extended and Enhanced) have increased 15% over the past year.” 1

All of this means that it’s important than ever for sourcing, procurement and vendor management leaders (SPVM) to understand SAP’s cloud licensing models to avoid expensive mistakes.

New Gartner research report takes a deep dive into SAP’s major SaaS offerings, which have been the primary focus of the SAP Cloud Services’ proposals reviewed by Gartner analysts over the past year.


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How SAP cloud agreements are structured

SAP’s Cloud Services includes platform, infrastructure and software “as a service” offerings. With its current portfolio, SAP has changed their licensing options and condensed them. This means that SPVM leaders face increasing challenges to identify potential cost savings and cost avoidance opportunities. The complexity and recent changes to how SAP SaaS contracts are structured means decision makers may not be aware of some of the key points to consider.

In this new report, Gartner offers tactical advice to negotiate the best cloud software prices and contracts with SAP. You’ll learn how to collect key internal data that must be considered when moving to the cloud. You must consider the myriad of critical factors to ensure that cloud service contracts are relevant, and that you get the maximum benefit from your cloud negotiations.

 

Protection from future SAP SaaS price increases

When moving to SaaS contracts, it’s crucial to mitigate against the risk of paying more than you budgeted for. Research shows that SAP SaaS contract clauses may have the most potential impact on costs and risks.

Gartner analysts have identified three high impact terms that you should be using when you negotiate SAP SaaS deals. Doing so will minimize unbudgeted costs and risk.

Based on real-life interactions with prospective and existing SAP SaaS customers, Gartner analysts show you how to:

  • Gain price transparency
  • Negotiate the inclusion of both list and net prices
  • Ensure URL Links embedded in order form cannot materially diminish for each line item

Choosing the right SAP SaaS licenses is one of the biggest – and most expensive – challenges SAP customers face today. Use this Gartner research as a guide to optimize your SAP contracts and minimize costs for Concur, Ariba, Hybris, SuccessFactors, S/4HANA, and others.


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1 Gartner, Reduce Unexpected Licensing Costs With SAP SaaS by Negotiating These Three Critical Terms, Roberto Sacco, Mike Tucciarone, Jocelyn Gerard, Dawn Hubbard. 25 November 2020. 1Based on SAP and SaaS: Minimize Unbudgeted Costs and Risk by Negotiating Six High-Impact Terms

 

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Myrja Schumacher

Myrja Schumacher

For more than a decade, Myrja Schumacher has specialized in SAP and Software Asset Management (SAM) for SAP. Her hands-on experience includes consulting, license management, contract management and all kinds of SAP® related projects.

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