SAP Product Licensing Guide

The shape of the SAP product portfolio

The SAP product portfolio extends well beyond the ECC and S/4HANA core. The cloud product portfolio includes SuccessFactors for human capital management, Ariba for procurement, Concur for travel and expense, BTP as the platform layer, Analytics Cloud for analytics, and a long tail of acquired and developed cloud products that each carry their own licensing model, metric, and commercial structure.

Customers who treat the cloud product portfolio as a single SAP relationship and accept a unified commercial proposal typically pay more than customers who treat each product as a separate commercial conversation with its own benchmark and its own leverage. The portfolio strategy is therefore one of the highest leverage decisions in the SAP commercial relationship. Cross reference our license consulting service overview.

SuccessFactors licensing patterns

SuccessFactors is licensed by employee or by module, depending on the modules in scope. The HCM core, including Employee Central, is typically licensed per employee. The talent modules, including Performance and Goals, Compensation, Learning, and Succession, are licensed per employee for the subset of employees who use them. The mix of full enterprise modules and partial enterprise modules drives the commercial conversation.

The most common SuccessFactors finding is overlicensing of the talent modules. Most customers license the talent modules at the full employee count even when usage is concentrated in a much smaller user base. Right sizing the talent module count typically reduces SuccessFactors spend by 15 to 25 percent. The detail is in our SuccessFactors module by module guide and the SuccessFactors licensing white paper.

Ariba and procurement product licensing

Ariba is licensed by spend volume on the network, by user, and by module. The Ariba Network access fee is set by the spend volume that flows through Ariba between the customer and its suppliers. The user licenses cover the buyer side users who access Ariba for sourcing, contracting, and procurement operations. The module licenses cover specific functional areas including Sourcing, Contracts, Buying, and Supplier Management.

The commercial complexity in Ariba sits in the network fee structure, which can grow significantly as spend volume grows, and in the supplier side fees that some Ariba contracts inadvertently impose on customer supplier relationships. The structuring of the network fee at contract signing is a once in a contract opportunity. The detail is in our Ariba procurement licensing guide and the Ariba licensing white paper.

Concur travel and expense licensing

Concur is licensed by active user, with the active user definition driving the commercial outcome. The most common finding in Concur estates is inflated active user counts that include former employees, infrequent travelers, and other populations that the contract does not require to be licensed. Right sizing the active user count typically reduces Concur spend by 10 to 20 percent at first review and more if the right sizing is sustained over the contract term.

Concur also carries module specific licensing for advanced expense, integrated travel, and procurement integration. The module mix should be reviewed annually against actual usage. The detail is in our Concur travel expense licensing guide and the Concur licensing paper.

BTP and the platform layer

SAP Business Technology Platform is the cloud platform layer that increasingly underpins integration, extension, and analytics across the SAP portfolio. BTP is licensed in capacity units, which abstract the underlying compute, storage, and service consumption into a single denomination that customers commit to ahead of consumption.

BTP commitments are the most commonly oversized commitment in the SAP cloud portfolio, because customers commit at the level recommended for the planned use case and the planned use case is rarely realized at the projected scale within the commitment term.

The BTP commitment strategy should start small, observe consumption for two or three quarters, then commit at the observed level plus a margin. The detail is in our BTP licensing white paper.

Analytics, BW/4HANA, and the data product layer

The SAP data product portfolio includes BW/4HANA for data warehousing, Analytics Cloud for analytics, Datasphere for the data fabric layer, and a set of embedded analytics capabilities inside S/4HANA. Each product carries its own licensing model and the overlap between them produces opportunities for both consolidation savings and inadvertent double licensing.

The most important strategic decision in the data product layer is whether to standardize on Analytics Cloud as the single analytics surface or to maintain a heterogeneous analytics estate with third party tools alongside Analytics Cloud. The standardization decision carries license consequence that compounds over multi year horizons. The detail is in our BW/4HANA licensing guide and Analytics Cloud licensing analysis.