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How to improve SAP ROI with smart licensing

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The implementation of SAP is a major IT initiative that has the potential to streamline business processes and make the organisation more efficient.

But, as Computer Weekly previously reported, many projects fail to meet the business objectives and expectations of their key stakeholders.

Based on a survey of 113 individuals across 105 companies by SAP advisory service Resulting IT, 52% of the businesses surveyed said their project was over-budget.

Licensing is one of the areas that is often not given enough focus, according to Rory Canavan, author of the SAM Charter.

“You have to do regular value chain analysis,” he said. “Spot the money making areas in your organisations and the technology that supports this. Find out where SAP fits in to determine which modules do not add value.”

According to Canavan, licensing is a key criteria IT departments need to get right to improve the return on investment on SAP.

Incorrect licensing can be costly and may reverse any potential return on investment in a SAP implementation.

Indirect access

A recent example is the Diageo ruling in February 2017, which highlighted SAP’s stance on indirect access. Diageo wanted to empower its business customers and sales representatives through a Salesforce system, which connect to its back-end SAP.

The high court ruled that by connecting its Salesforce system to SAP, Diageo was using the core ERP in an unlicensed way. The sales team and each and every business customer was considered a SAP professional user, which incurs the highest licence fee. Diageo was fined £55 million for the unlicensed use SAP.

Canavan said businesses need to ensure they have licenced SAP optimally, to meet the requirements of different groups of users. “Many business still continue to buy licences and fail to reuse licences. To validate that, users who are running SAP are still at the company,” he said.

He suggested that if user email accounts hardwire to the Microsoft Active Directory, IT can suspend both email access and access to software when the user leaves. Going further, Canavan recommended IT departments consider using a configuration management database (CMDB) to ensure users are only given access to software when they need actually it.

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Article Credit: CW

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