Licensing Considerations for SAP Transformation

🚨𝗦𝗔𝗣 𝗦/𝟰𝗛𝗔𝗡𝗔 𝗖𝗼𝗺𝗽𝗮𝘁𝗶𝗯𝗶𝗹𝗶𝘁𝘆 𝗣𝗮𝗰𝗸𝘀: 𝗖𝗿𝗶𝘁𝗶𝗰𝗮𝗹 𝗟𝗶𝗰𝗲𝗻𝘀𝗶𝗻𝗴 𝗗𝗲𝗮𝗱𝗹𝗶𝗻𝗲 𝗔𝗽𝗽𝗿𝗼𝗮𝗰𝗵𝗶𝗻𝗴🚨 📌SAP S/4HANA customers relying on Compatibility Packs must act swiftly, as SAP has announced that the licensing rights for these packs will expire on December 31, 2025. Post this date, continued use will be considered a breach of contract, leading to potential legal and operational consequences. 𝗪𝗵𝗮𝘁 𝗔𝗿𝗲 𝗖𝗼𝗺𝗽𝗮𝘁𝗶𝗯𝗶𝗹𝗶𝘁𝘆 𝗣𝗮𝗰𝗸𝘀? 👉Introduced in 2015, Compatibility Packs served as a transitional bridge for customers migrating from SAP ECC to S/4HANA, allowing them to retain certain ECC functionalities not initially available in S/4HANA. 👉With the evolution of S/4HANA, especially the 2023 release, SAP has integrated most of these functionalities natively, rendering the packs largely obsolete. 𝗞𝗲𝘆 𝗗𝗲𝗮𝗱𝗹𝗶𝗻𝗲𝘀 𝗮𝗻𝗱 𝗘𝘅𝗰𝗲𝗽𝘁𝗶𝗼𝗻𝘀: 📌December 31, 2025: Licensing rights for most Compatibility Packs expire. 📌Extended to 2030: Exceptions include Customer Service (CS), Transportation (LE-TRA), and Production Planning for Process Industries (PP-PI). 📌RISE with SAP Customers: Granted extended use rights through 2030. 𝗔𝗰𝘁𝗶𝗼𝗻 𝗦𝘁𝗲𝗽𝘀 𝗳𝗼𝗿 𝗦𝗔𝗣 𝗖𝗹𝗶𝗲𝗻𝘁𝘀: 📍Assess Current Usage: Utilize SAP tools like Readiness Check, Simplification Item Check, and Custom Code Analyzer to identify dependencies on Compatibility Packs. 📍Plan Transition: Develop a roadmap to migrate from Compatibility Pack functionalities to native S/4HANA capabilities. 📍Engage Stakeholders: Collaborate with internal teams and SAP partners to ensure a smooth transition. 📍Consider RISE with SAP: For extended support and a structured migration path, evaluate the RISE with SAP offering. 👉𝗪𝗵𝘆 𝗜𝗺𝗺𝗲𝗱𝗶𝗮𝘁𝗲 𝗔𝗰𝘁𝗶𝗼𝗻 𝗶𝘀 𝗖𝗿𝘂𝗰𝗶𝗮𝗹: Delaying the transition may lead to compliance issues, operational disruptions, and potential legal ramifications. Moreover, as SAP continues to evolve its platform, relying on outdated CompatibilityPacks could hinder access to new features and innovations. ☑️𝗙𝗶𝗻𝗮𝗹 𝗧𝗵𝗼𝘂𝗴𝗵𝘁𝘀: The deprecation of Compatibility Packs signifies SAP's commitment to streamlining and modernizing its ERP solutions. Organizations must proactively adapt to these changes to ensure continued compliance, operational efficiency, and to leverage the full potential of S/4HANA. 🔗 For a detailed overview, refer to the full article: cio.com https://lnkd.in/drrgHr76 #SAP #S4HANA #ERP #DigitalTransformation #SAPMigration #Compliance #RISEwithSAP

𝗕𝗿𝗲𝗮𝗸𝗶𝗻𝗴 𝗗𝗼𝘄𝗻 𝗦𝗔𝗣'𝘀 𝗨𝗽𝗱𝗮𝘁𝗲𝗱 𝗦𝗧𝗔𝗥 𝗦𝗲𝗿𝘃𝗶𝗰𝗲 𝗥𝘂𝗹𝗲𝘀𝗲𝘁: 𝗛𝗶𝗴𝗵𝗲𝗿 𝗖𝗼𝘀𝘁𝘀 𝗮𝗻𝗱 𝗟𝗲𝗴𝗮𝗹 𝗜𝗺𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻𝘀 SAP has recently released the new version of the STAR Service Ruleset (V1.69). For the first time, SAP has upgraded the license classification for several authorizations, leading to higher licensing costs for customers who aligned their authorizations based on the previous STAR Ruleset. 🔍 𝗪𝗵𝗮𝘁'𝘀 𝗖𝗵𝗮𝗻𝗴𝗲𝗱?  Several authorizations are now considered "Advanced Use" instead of "Core Use" in the Private Cloud (or "Professional Use" instead of "Functional Use" for On-Premise). This means that many customers are now facing increased costs, especially if they have already remodeled their authorization landscape to align with SAP's STAR Service, as recommended. 💡 𝗞𝗲𝘆 𝗣𝗼𝗶𝗻𝘁𝘀 𝘁𝗼 𝗖𝗼𝗻𝘀𝗶𝗱𝗲𝗿: 𝘐𝘮𝘱𝘢𝘤𝘵 𝘰𝘯 𝘓𝘪𝘤𝘦𝘯𝘴𝘪𝘯𝘨 𝘊𝘰𝘴𝘵s: Customers who followed the STAR Ruleset may now face higher costs due to the upgraded classifications. 𝘓𝘦𝘨𝘢𝘭 𝘐𝘮𝘱𝘭𝘪𝘤𝘢𝘵𝘪𝘰𝘯𝘴: What does this mean for the principle of the STAR Ruleset being a guide to good and compliant licensing? 𝘕𝘦𝘹𝘵 𝘚𝘵𝘦𝘱𝘴: It's crucial for SAP professionals to review the updated Ruleset and assess the impact on their organization's licensing strategy. The only way to avoid this pitfall is to include the current definition of the STAR Service in your contract whenever you sign a contract that relies on the STAR Ruleset (e.g., a "normal" SAP Cloud ERP Private contract). This way, you will not have to deal with such surprises for the duration of your contract. You will find the link to the updated STAR Note in the comments section. Let's discuss how these changes affect your SAP environment and what steps you can take to mitigate the impact. Share your thoughts and experiences below! 👇

Perpetual Licenses vs. RISE with SAP: What You Should Know? SAP customers are at a crossroads. For years, perpetual licenses were working out well for them. You paid upfront, owned the software, and had complete control and a yearly maintenance fee after that. But things are changing fast. SAP is pushing RISE with SAP, a subscription-based model, and the shift isn’t just a suggestion, it’s a very clear push. Here’s what’s happening: Perpetual licenses are no longer promoted, and for many, they are simply no longer available. Please ask me why. AI innovations and new features? They’re tied exclusively to SAP’s cloud offerings like RISE or public cloud. So, sticking with a perpetual license could mean locking yourself out of SAP’s future tech advancements. Yes, It may sound unfair to SAP customers who took the early initiative and moved to S/4 HANA on-prem through a perpetual license.  but that is what SAP is indicating so far and it may or may not change in the future. A few things you need to understand so that you are ready to negotiate when you decide to go that route. The Key Differences  Perpetual License: Upfront cost with annual maintenance fees (usually % of license). Full control of your system, ideal for on-premise setups. Licensing based on Named Users tied to specific roles. RISE with SAP: 1) Subscription includes hosting, updates, and support. 2) 𝗨𝘀𝗲𝘀 𝗙𝘂𝗹𝗹 𝗨𝘀𝗲 𝗘𝗾𝘂𝗶𝘃𝗮𝗹𝗲𝗻𝘁𝘀 (𝗙𝗨𝗘𝘀) 𝘁𝗼 𝗺𝗲𝗮𝘀𝘂𝗿𝗲 𝗮𝗰𝗰𝗲𝘀𝘀: Understanding SAP's FUE (Full Use Equivalent) calculation is essential when transitioning to RISE with SAP. Here’s the deal: SAP uses a weighting system to determine how many FUEs you need based on user roles and their access levels. Here’s how the ratios stack up: 1 FUE = 0.5 Developer Access (1 Developer = 2 FUE ) For developers. 1 FUE = 1 Advanced Use For users with full access to all applications and critical business functions. 1 FUE = 5 Core Use For users accessing specific tasks like forms and reports. 1 FUE = 30 Self-Service Use For basic, infrequent users handling approvals or simple tasks. Why It Matters Careful planning can save you money. What should be your next steps in my opinion? - Audit your users and usage: Why? Full Use Equivalents (FUEs) can be confusing and understanding can help you calculate and keep your budget in check. If you have any questions about it I’d be glad to help. - Think long-term: Will your business need AI and cloud capabilities in the future? If you are not ready yet (S/4HANA on-prem customers) you do not have to move immediately since there is considerable investment is already made. - Plan your budget: Understand the full costs of both models, including hidden ones. While SAP is making a push it may not be all bad news. Whether you stick to perpetual or move to RISE, understanding your options is critical. If you have a question please reach out. Cremencing Solutions #sap #s4hana

SAP is sounding the alarm for S/4HANA users as the end of Compatibility Pack licensing approaches. Here's a breakdown of the key points: - **Deadline:** By December 31, 2025, most customers must cease using Compatibility Packs to avoid breaching their contract with SAP. - **Background:** Introduced in 2015 to aid the transition from SAP ECC to S/4HANA, Compatibility Packs are now deemed largely unnecessary post the 2023 SAP release. - **Consequences:** Non-compliance post-2025 could lead to technical unavailability of pack functions, legal repercussions, and intensified audits by SAP. - **Exceptions:** Certain packs and SAP RISE customers enjoy extended rights until 2030. - **Challenge:** Around 70% of S/4HANA users may unknowingly rely on Compatibility Packs, necessitating process reengineering, user training, and potential module adoption. - **Recommended Action:** Companies are advised to conduct system audits promptly, identify pack dependencies, and initiate corrective measures to prevent licensing infringements and legal entanglements. Ensuring compliance with SAP's directives demands a strategic approach, encompassing planning, adequate resources, and proficient consultants. Stay ahead of the curve to sidestep complications down the line. #SAP #S4HANA #CompatibilityPack #BusinessTransformation