Expert SAP Licensing Consulting for S/4 Cloud

These changes have a direct impact on licensing, existing contracts, and ongoing S/4 HANA transformations. Making the right investment decisions therefore depends largely on contract negotiations. With S/4 Cloud, traditional, clearly assignable user licenses are a thing of the past. Instead, SAP operates with abstract user concepts—known as Full Use Equivalents (FUE)—that only indirectly reflect a company’s actual needs. Without sound advice, customers run the risk of paying for features they rarely or never use in practice.

A key challenge is to realistically assess future usage patterns. Companies are transitioning from a familiar on-premises environment to a cloud environment, which brings with it new rules of the game—both technologically and commercially. To understand these changes, more and more companies are now turning to professional contract consulting services, such as those offered by Uwe Werner IT Procurement Consulting.

The standard bills of materials provided by SAP often do not adequately reflect actual requirements. Only a bill of materials (BoM) that has been individually customized in collaboration with a consultant—and that precisely defines which functions are actually needed—unlocks significant cost-saving potential, particularly in large-scale S/4 transformation projects. In this context, not only the total contract value (TCV) but, above all, the total cost of ownership (TCO) plays a decisive role. In addition to the pure software costs, operation, maintenance, and, if applicable, existing infrastructure must also be taken into account.

In practice, a comprehensive cost analysis shows that a well-thought-out Rise approach can yield savings of up to 20 percent compared to flat-rate cloud models. In the end, precision pays off: A clearly defined Bill of Materials (BoM) results in an SAP system that is precisely tailored to the company’s requirements. This helps avoid over-licensing, unnecessary costs, and future customization issues—ensuring that the move to the cloud is not an expensive detour but rather a cost-effective transformation.

Greater Flexibility in On-Premises Maintenance

As far as SAP’s new maintenance and support commitments are concerned, there are many useful elements: the elimination of the reinstatement fee, a cap on back-maintenance, landscape split—and thus greater flexibility in using third-party support—as well as new opportunities through single-metric contracts. SAP aims to expand the options available to on-premises customers while simultaneously implementing requirements set by the European Commission. The landscape split and the regulations related to extended maintenance are particularly exciting in this context. The former opens up the possibility of using different maintenance models within a single SAP landscape. At the same time, new strategic options could arise for companies that wish to continue operating their on-premises systems for several more years.

A closer look at the detailed provisions reveals that many of the new options are subject to specific conditions. These include, for example, a workforce reduction of more than 10 percent within two years, the sale of business units (divestitures), implementations that failed due to SAP’s fault, insolvency, or products under Customer Specific Maintenance.

Either way, the new regulations are an improvement over the previous status quo. The key question now is how many SAP customers will actually be able to take advantage of them and how many will be left out due to the defined requirements. Practice will show whether these commitments create tangible added value for the broad customer base or whether they primarily apply in specific individual cases.