Northern European Food Producer

Major licence savings and risk mitigation in SAP S/4 HANA conversion

Zangenberg Analytics provided the basis for secure commercial migration and license optimisation during the transition to SAP S/4 HANA for one of the largest SAP installations in Northern Europe.

Negotiation of Licences for S/4 HANA

The client was faced with migrating one of the Nordic region’s largest SAP installations from ECC to S/4 HANA. The major commitment, technical scope and depth of solutions involved in the migration entailed great complexity and financial risk.

Nor did the client have a full grasp of the actual use of SAP. This meant it had not previously been possible to establish a clear link to the business value. Nor were they inclined to shell out the money.

Accordingly, they wished to ensure the best possible basis for negotiation, so discussions could be based on hard facts vis-à-vis consumption patterns, business value and market prices.

Our assistance

Zangenberg Analytics’ leading benchmark database contains products, terms and prices for SAP installations for a large number of SAP customers throughout Northern Europe.

We assisted the client in creating the basis for negotiation, based on data analysis of detailed SAP transaction patterns, mapping of the SAP contract portfolio and benchmarking market prices and terms.

During the negotiations, we provided constant assistance and applied our experience from comparable SAP PSLE clients, enabling the client to position themselves optimally in the negotiations, and ensuring that every element of the negotiating process was anchored in actual business value.

Based on the implementation plan, we deployed our SAP transaction analysis models to predict the financial consequences and real utilisation of the SAP S/4 products. The client’s measured usage declined significantly in several areas in the future S/4 HANA roadmap, and it was used to negotiate prices and terms at market level.

Together with the client, we translated it into a negotiation roadmap and a large number of optimisation levers with major savings on the licence costs associated with Users, Cloud and Business Objects.

Results

Identified license cost savings of 24% on the existing SAP on-premise and cloud portfolio
Mitigated conversion risk of >EUR 12 m by optimising SAP S/4 conversion scenarios based on actual transaction patterns
An overview of licensing and operating costs for the Greenfield, Brownfield and Hybrid implementation scenarios, which the client was facing
Prepared negotiation process together with the negotiation team and IT management, featuring focus points, position and hedging of risks prior to discussions with SAP