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Be compliant or not compliant

Even if S/4 is not a tragedy like Shakespeare's Hamlet, the question for the existing SAP customer is whether he can live with the S/4 provisions in the PKL. If not, then this must be included in the contract negotiation.
Guido Schneider, SLC365
June 5, 2023
This text has been automatically translated from German to English.

By now, almost all existing SAP customers should be dealing with the topic of S/4 migration. In addition to the technical migration, it is also worth considering the contractual changes. SAP offers the following options for this:

Product Conversion

SAP is pushing to operate the ERP systems via cloud licenses. Those who do not wish to do so can continue to use the on-prem licenses. In the case of product conversion, the existing ECC contracts remain in place. This means that the existing license metrics for the individual SAP products also continue to apply. This applies to Engines, but also to indirect usage and existing user rights. The metric for indirect usage is user-based and engine-based (e.g. Sales and Service Order Processing). User licensing is usage-based, i.e., a specific user type license is required depending on the transactions executed.

Contract Conversion

As an alternative to product conversion, SAP offers S/4 contract conversion. In this case, the existing ECC contracts are cancelled on a certain date and thus become invalid. In the future, only the S/4 contract with the associated general terms and conditions and the price and conditions list (PKL) will apply. On the new Bill of Material (BOM) there are only S/4 products, with partly new license metrics. If an enginemetric changes, then you have to check before signing the contract if you are still compliant afterwards with your current usage and licensing. The same applies to both indirect usage and user-dependent usage. For indirect use, SAP has described the digital access licenses in the PKL. Sooner or later, these will be measured like an engine. Those who do not want this must regulate the desired deviation in the conversion contract.

Things get interesting when it comes to users. SAP offers the "S/4 Trusted Authorization Review" (Star) service to determine the need for "S/4 Hana Enterprise Management for Professional, Functional and Produc-tivity Use" licenses. As the name suggests, this is based on the existing authorizations and not on the transactions executed.

FUE licenses

It is no different with user licenses in the cloud, here they are called full-use equivalent (FUE) licenses. What is still the star service today could replace self-disclosure tomorrow. Recommendation: before, during and after the S/4 migration, use an SAP-independent tool to optimize SAP cloud solutions and services, as well as users and their authorizations. Otherwise, as in Shakespeare, you may not lose your life, but you will unintentionally lose compliance, and that can be expensive.

Guido Schneider, SLC365

Guido Schneider is founder and owner of Software License Compliance 365.

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Working on the SAP basis is crucial for successful S/4 conversion. 

This gives the Competence Center strategic importance for existing SAP customers. Regardless of the S/4 Hana operating model, topics such as Automation, Monitoring, Security, Application Lifecycle Management and Data Management the basis for S/4 operations.

For the second time, E3 magazine is organizing a summit for the SAP community in Salzburg to provide comprehensive information on all aspects of S/4 Hana groundwork. All information about the event can be found here:

SAP Competence Center Summit 2024


Event Room, FourSide Hotel Salzburg,
At the exhibition center 2,
A-5020 Salzburg

Event date

June 5 and 6, 2024

Regular ticket:

€ 590 excl. VAT


Event Room, Hotel Hilton Heidelberg,
Kurfürstenanlage 1,
69115 Heidelberg

Event date

28 and 29 February 2024


Regular ticket
EUR 590 excl. VAT
The organizer is the E3 magazine of the publishing house AG. The presentations will be accompanied by an exhibition of selected SAP partners. The ticket price includes the attendance of all lectures of the Steampunk and BTP Summit 2024, the visit of the exhibition area, the participation in the evening event as well as the catering during the official program. The lecture program and the list of exhibitors and sponsors (SAP partners) will be published on this website in due time.