Establishing the material software entitlement and understanding the contractual terms and conditions governing licensing and software usage specific to your organisation. Provides the benchmark against which usage is measured.
Establishing entitlement involves detailed analysis and review of all SAP contracts, procurement documents and material purchase artefacts. By aggregating all material purchases JNC constructs an SAP Bill-of-Materials, which will include all purchased engines and named-user licenses. The SAP Bill-of-Materials is the artefact against which software licensing compliancy can be managed and established. The contract review reveals the business metrics applicable to all SAP engines, what needs to be measured and how in order to determine compliant usage. It is crucial the entitlement is not only established accurately but properly understood.
Actual usage definitions of each named-user license purchased and what usage is applicable to each license type is also revealed allowing compliancy to be determined for any given named-user and achieve total net named-user compliancy across the enterprise. Part of the contract review process involves assembling a full and complete document set from which the contract review can commence and bill-of-materials established. This process is vitally important is the absence of one document or page or the absence of an applicable document version can be the difference between compliancy and non-compliancy, and millions in potential cost.
A single clause in the SAP contract can have a considerable impact on the outcome of an audit.
To read more about our Contract Review services click here.
The Named-User Licensing (NUL) measurement phase provides an accurate view of the named-user licensing required by the business to support actual usage of the SAP software compared to the licensing assets currently held. The process either identifies surplus or shortfall against each named-user license type within your contract (as documented in the BoM) or other applicable license types not already procured.
The Named-user Audit process involves establishing the total number of unique named-user who require a license including identifying and eradicating dormant and duplicated users. We convert contractual descriptions the technical level authorizations definitions to determine the license type each named-user entity requires, which is typically dependant on what users can and can’t do in the SAP system, namely SAP roles and authorizations. This process discovers what licensing the organisation would require if audited by SAP themselves.
Audit Simulation reveals a more accurate and realistic view of licensing that SAP standard audit tools can’t. These tools namely SAP LAW reads only the license type assigned by the client, without interrogating authorizations to determine the license type actually required. As SAP assume surplus is to be held for active management, the only shortfall is presented in the audit result. Any shortfall measured is calculated at list price to determine the named-user audit liability where back-dated maintenance and interest charges may also apply.
The SAP Engines Audit determines either over or under usage of package licenses measured by comparing consumption against the entitlement purchased for each applicable business metric.
Whilst named-user license prices are more or less consistent for all organisations, SAP Engines are priced based on business metrics. For many core and non-core SAP products, an Engine is required to deploy and use that solution. Many different business metrics could be used, where prices are tiered making each unit of entitlement cheaper the more you buy. This makes pricing scalable and proportionate to each customer buying the software.
The Engines Audit process involves establishing all SAP Engines in use and comparing usage to engines purchased and the level of entitlement held for each. Due to the SAP marketplace, it is easy and common for organisations to be using SAP system functionality that they haven’t purchased, and with companies growing an expanding rapidly, entitlement levels held can be easily exceeded leading to non-compliant use.
The audit simulation detects unlicensed engine usage, and the over or underuse of existing engines. In the instance of surplus engine entitlement, this can be catalogued as leverage to be used in future negotiations with SAP. For the non-compliant usage, additional entitlement would need to be purchased in order to be compliant with a license audit.
As with named-user licensing the only shortfall is presented in SAP’s audit result and buying entitlement as the result of an audit can, therefore, be significantly more expensive.
Indirect Access Audit
The Indirect Access Licensing Review evaluates how the use of third-party systems interfaced to SAP needs to license in order to be compliant with the SAP Software Contract. This phase of the audit simulation determines if adequate licensing is in place or if licensing is required and to what extent, giving clients a quantified view of Indirect Access licensing risk or the assurance that the customer is compliant.
Unlicensed indirect usage can be potentially very costly depending on the extent of the use and the nature of the data exchanged with the SAP system. The Indirect Access Audit is carried out by mapping the interfaces between the SAP and third-party systems followed by a detailed usage evaluation to determine the risk and any licensing gaps. In the case of Indirect Access, it is the contractual inclusions and exclusions that will determine if indirect third-party systems usage is compliant or needs to be licensed in accordance with SAP’s definition of Indirect usage licensing.
A single interface can give rise to unlicensed indirect usage. Indirect Access licensing risk can also be addressed as a standalone service.
To view our Indirect Access services click here.
JNC’s License Audit Simulation service also provides a benchmark from which Enterprise License Optimisation can be carried out. License Optimisation is performed at three levels. License Management Optimization, which addresses license management, user classification and user administration errors is part and parcel of an audit simulation.
Deep-dive name user license optimization goes beyond compliant user-classification to identify and remove redundant authorizations such that each user can not only be classified compliantly but classified with the cheapest available license type according to optimized user provisions.
Enterprise License Optimization then goes beyond systems level optimization to address the enterprise-wide licensing position looking to modernise and consolidate redundant metrics and to convert the value tied up in surplus license assets into the value that can be redeemed against license assets that support current needs and future plans.
There is typically a strong business case for license optimisation following a license audit. License Optimisation can also be delivered as stand-alone end-to-end licensing service. To read about JNC SAP License Optimisation click here.
For more information about our SAP License Audit Simulation and to learn how we can help your business: