Gartner Research

Key Terms to Negotiate in SAP Cloud Service Agreements to Reduce Direct Costs and Risks

Published: 20 July 2016

ID: G00310660

Analyst(s): Alexa Bona, Dawn Hubbard , Lori Samolsky

Summary

SAP has recently made significant changes to its cloud contracting structure and terms, resulting in some improved entitlements and a more synthesized support offering. However, a number of concessions can be negotiated to reduce cost and risk.

Table Of Contents
  • Key Challenges

Introduction

Analysis

  • Negotiate a Payment Holiday or Reduced Subscription Fees During the Initial Months of Implementation
  • Negotiate Future Unit-Price Reductions If Volumes Increase Significantly
    • Lock in Prices for Additional Storage or Sandbox Needs
    • Lock in Price Holds for Adding Incremental Service Lines and Exchange Clauses If Possible
  • Technology Procurement Leaders With Strong Leverage Should Negotiate a Proportional Fee Reduction If Usage Declines
  • Ensure That the Capabilities Offered Are Global, With No Premium Prices for Language Versions
  • Negotiate Reductions for SAP's Preferred Care Offering
    • Key Differences Among SAP's Support Offerings
    • Do Not Expect All SAP Cloud Service Terms to Be Negotiable

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