A growing number of organizations have either already implemented SAP S/4HANA or are in the process of implementing and plan to go live soon. The introduction of RISE with SAP in January 2021 has significantly accelerated S/4HANA adoption, with more than 40% of companies already live with SAP S/4HANA or having started relevant projects.*
Unfortunately, the implementation of SAP S/4HANA or RISE with SAP won’t stop the time-consuming yearly SAP system measurements or the extended audits. On the contrary, the way these new systems are being measured and audited are changing, and this may come as a surprise to SAP S/4HANA customers.
To fully grasp the new reality for SAP system measurements and audits, SAP customers first need to appreciate that there are two key factors that influence the measurement:
- The kind of contract
- The type of installation
At the beginning of every system measurement or audit, the contract(s) and respective price and condition lists of SAP, should always be the starting point. This is the single source of truth where all information about entitlements, terms and conditions can be found. There are different options organizations may choose when migrating to S/4HANA. The S/4HANA contracts will differ depending on whether the migration has been via a “product” or “contract” conversion.
Product Conversion – Phased Approach
|You keep your existing contract||You can do a step by step conversion|
|You can’t convert to products you already own||No need to re-license everything at once; you can focus on one at a time|
|You can still use SAP “classic” apps until 2027, even after you have converted them|
Contract Conversion – For Customers Already Committed to S/4HANA
|You negotiate a new contract||Move to the next-gen ERP and database tech|
|You migrate to the new S/4HANA use rights||Opportunity to reconfigure SAP landscape, and renegotiate for a simpler contract|
|You can choose the products you want||You can still use SAP “classic” apps until 2027, even after you have converted them|
The contract includes details about the “User Licenses” (product conversion) or “Use” (contract conversion), inclusive of any special agreements.
It also describes which SAP engines or add-ons are licensed. This is relevant for contract conversions as S/4HANA add-on users don’t usually require “Use” licenses; as with S/4HANA, the add-ons are licensed separately. The contracts may additionally contain any agreements regarding indirect usage or digital access. As the contracts form the basis for any SAP system measurements and possible extended audits, it is vital that customers know and understand the content.
The second differentiator is the installation type. This distinguishes between a classic on-premises installation (which might also run in the cloud), an S/4HANA public cloud installation and an S/4HANA private cloud installation.
1. SAP S/4HANA on-premises installations are measured like any other SAP Business Suite system, with the support of USMM and LAW.
Customers must set the right “User” or “Use” licenses, according to their contract. But there are two details customers may not be aware of:
The “Use” licenses need to be set according to the respective role and authorization a user has and not to their actual usage (e.g., used transactions). This could have a massive impact on the amount of required expensive Professional Use licenses. The only way to avoid any over-licensing is to clean up and take away unnecessary roles and authorizations.
The HANA database is not measured automatically with the USMM; this has to be done manually. The HANA database measures itself and produces a measurement report and exports to an XML file. It only measures the maximum usage quantities, which leads automatically to the highest costs for their customers. Customers also need to be aware that SAP has a new tool in which the HANA Runtime licensed databases are being checked for full use. This tool is in the pilot phase.
2. SAP S/4HANA private cloud installations are also measured with the support of USMM and LAW.
Again, there are two bits of information customers may need to know:
SAP requires consistent user names for the user consolidation. In the past, users could also be consolidated based upon first and last name or e-mail address. This won’t be possible anymore within the SAP S/4HANA private cloud installation.
SAP has been talking about implementing monthly automatic measurements and an automatic consolidation with the dashboard in SAP LUI.
3. For SAP S/4HANA public cloud installations, SAP came up with a new measurement.
The measurement will be by assigned roles, with the help of a business catalog and the respective role classification according to the SAP S/4HANA service description. The minimum amount of required full-use equivalent licenses (FUEs) will be automatically calculated according to the highest classification (e.g., Developer Use, Advanced Use, Core Use, Self Service Use).
- 1 x Developer Use = 2 FUE
- 1 x Advanced Use = 1 FUE
- 5 x Core Use = 1 FUE
- 30 x Self Service Use = 1 FUE
Finally, customers need to consider indirect use and digital access. While SAP is still not capable of measuring the number of indirect users, they are very able to identify any possible indirect use. With support of the SAP passport, SAP can now measure the number and kind of digital documents created in a digital way. The measurement will be done with the support of the USMM. The calculation starts after the implementation of the SAP passport, and it’s worth noting that a full calculation will be available to SAP a year after that.
With all the different system measurement changes occurring, it is crucial for customers to have a complete in-depth understanding of exactly what they have entitlements for, what they use and what they truly need in this new, multifaceted S/4 world.
Learn how Snow Software can support you through the transition to S/4HANA and help you prepare for the next system measurement and audit, whether this is for your legacy, hybrid or new landscape.
* According to a joint survey by the Americas’ SAP Users’ Group (ASUG) and the German-speaking SAP User Group (DSAG) in April and May 2021, 24 percent of participating ASUG and DSAG members said they are already live with S/4HANA, while a further 21 percent (ASUG) and 20 percent (DSAG) are currently going through the transformation process. Approximately 37 percent of DSAG members (30 percent of ASUG members) are planning a relevant project, but have not yet started it. SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries. All other product and service names mentioned are the trademarks of their respective companies.