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Group Therapy for SAP Customers seeking Licensing clarity

Another Mastering SAP conference event done and dusted. And this one lingers in my mind. Not because it was the largest I’ve seen locally in Melbourne with around 800 attendees. Not because of whatever new products I may have heard of, and not because of the keynote messages around digital disruption, machine learning and automation. It lingers in my mind because of what I learned talking to customers about their thoughts, comments and concerns around SAP and indirect access licensing.

This year the conference organizers Eventful Group decided to mix things up a little by bringing a more intimate ‘round table’ setting to a few of the sessions at the event. One of the sessions was earmarked for a customer round table discussion on ‘SAP and Indirect Access Licensing’. As this was treated as a hot topic, two separate round table sessions ended up being scheduled into the agenda. Being a SAP Mentor alumnus, the Eventful Group asked me to facilitate both with the role of promoting a sharing of thoughts between customers. I’m unsure if being an alumnus is why I drew this controversial topic, but in hindsight I’m glad I did. The actual setting for the sessions was indeed round tables and with reduced seating to ensure the discussion could be more intimate between the attendees. In total across both sessions we had approximately 40 customer representatives.

There was no SAP representation at these sessions, and the intention wasn’t to find answers to specific indirect access licensing queries because that is the purview of specialist legal licensing advisors. It was definitely a worthwhile exercise for all concerned as customers shared insights into the complexities of their modern day architectures and uses of SAP. One attendee openly shared that they had previously worked as a license auditor for SAP and that certainly injected some more colour into the conversation. I’m grateful we had Mark Baker (SAP Australia User Group) joining us to clarify how the user groups (in particular the composite group SUGEN) are working with SAP to provide more clarity on licensing. On reflection it felt like the round table group was collectively involved in a ‘design thinking’ session to truly understand the difficulties and challenges faced in their SAP licensing landscapes.

Whatever the case, here’s some learnings that our participants took out of the twin sessions …

1. Be familiar with your own contract and SAP’s definition of ‘Usage’

One of the challenges that exists with SAP licensing is that each and every customer’s contractual terms may differ, by virtue of whatever specific terms might be written into the customer’s order form. That makes it particularly difficult to have a ‘common denominator’ discussion around licensing. In addition to that, licensing approaches might differ for customers using SAP’s Business Suite compared with those using S/4HANA. And further complexity is introduced with SAP’s other products, cloud solutions etc. From the discussion around the room it seemed that no two customers were truly the same.

That said, a good start is to look at the definition of ‘Use’ in SAP’s ‘Software Use Rights’ outlined in the standard terms and conditions.

2. Be aware of SAP’s Indirect Access Whitepaper

As a consequence of the elevated angst last year over indirect access licensing triggered by the high profile court judgement for SAP UK vs Diageo, the various SAP user groups (via SUGEN) brought their concerns to SAP and one such outcome was an Indirect Access Whitepaper issued by SAP.

When asked by a show of hands how many attendees had read this whitepaper the proportion that indicated they had read it was somewhere around one third of the session participants (averaged across the two sessions). A similar proportion of customer attendees did not know of its existence. On the other hand a few customer representatives said they had read it several times.

3. Be aware of SAP’s Licensing Transparency Centre

In the SAP user groups’ dealings with SAP on this topic, another outcome of last year’s events was the establishment of a SAP Licensing Transparency Centre. The idea behind this centre is to provide an alternative place for customers to submit queries to SAP about their specific situations and the potential licensing treatment for that situation. The rationale is that customers don’t necessarily trust their account executives to give an impartial response to such queries.

Of all the participants at the Mastering SAP sessions which I attended, only two attendees (5%) were aware of this service. I’m advised that submissions to the SAP Licensing Transparency Centre must be via the customer’s local user group and that the identity of the customer can remain anonymous on request. Interestingly, even with this arrangement a few customers expressed reservations about whether identities submitted to their local user group would be respected and protected from disclosure to SAP.

4. Educate your teams

One of the challenges customers seem to have is the loss in connection between what is negotiated in licensing behind closed doors (often years ago) by a customer’s commercial team and SAP, and what is technically designed and implemented at the coal face of SAP teams today. And increasingly as customers seek to ‘innovate around the core’, other groups such as web or digital teams can be inadvertently exposing SAP data or usage in the name of innovation. I can’t help but think that ignorance about licensing agreements by those building solutions in and around SAP systems is the greatest indirect access licensing risk faced by customers. One customer who participated in the discussions shared how they are instituting an active program to educate and embed licensing risk analysis into their enterprise architecture and solution architecture teams. That’s probably good advice for all customers.

5. Govern your solutions

Extending upon the previous point, it can be prudent to fortify education with governance. This is particularly relevant when customers engage third party integrators to build solutions, whereby those integrators might have no knowledge of the customer’s specific licensing terms. In these circumstances customers need to be additionally vigilant that the integrator’s solutions don’t expose them to any indirect access licensing risks.

6. Lean on SAP to continue clarifying and modernizing its licensing

Whilst good education and governance can protect customers against the obvious indirect access licensing risks, the reality is that scenarios can exist for which the position on licensing may not seem so obvious. During the sessions I heard customers ask about scenarios that were not addressed in SAP’s indirect access licensing whitepaper. Hearing about these scenarios, it is apparent that more work needs to be done in this growing ‘grey area’ to clarify the licensing position for customers. Customers even found ‘grey areas’ in connecting SAP products to other SAP products. During the discussions, at no time did I hear about customers seeking to undermine SAP’s rights to intellectual property for its products. In fact I felt a general desire to act in good faith, but at the same time a general distrust in whether SAP would do the same in its interpretations for ‘grey areas’. As customers continue to evolve and transform their technology landscapes, I’m hoping the user groups can continue to lean on SAP to similarly modernize its licensing clarity and approaches.

During the conference, Björn Goerke (CTO of SAP and President of SAP Cloud Platform) made mention during his keynote speech of how SAP is working hard to ‘expose APIs’ (application programming interfaces) for its digital core. From a technologist’s perspective that is very welcome. But when I heard that, the thought which immediately came to mind was how a large increase in APIs could similarly bring a proportionate increase in indirect access licensing risks. Developers tapping into these APIs can more readily expose ‘usage’ of the SAP systems to a broader audience.

Finally, a word about the creative images featured throughout this blog. This fabulous work was created by Glenn Stephenson, a local Graphic Recorder who was engaged by Eventful Group to record selected sessions in an artistic format. Thank you to both Glenn and The Eventful Group for permission to share this creative work – all the participants at the session were suitably impressed. The images nicely distill the sentiment and ideas captured from the sessions (although it is important to see them as just that, rather than statements of fact). And thank you to Mark Baker (SAUG) and all the customer representatives who attended the sessions. Extra special thanks to Kim Aldridge and Eventful Group for conceiving and hosting these round table sessions, and for running another fabulous event. I had feedback relayed from the conference organizers that for some participants the sessions felt ‘like therapy’. Group therapy or not, we all walked out understanding a little more about the challenges faced by customers in licensing clarity.


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