There has been a wave of press and PR notable to those of us who keep an eye on the SAM and software licensing markets recently associated with the SAP v Diageo case.
In part the noise is an inevitable outcome of a limited number of such disagreements getting to court (with SAP v. Diageo being the first such SAP case we have seen reach a legal judgment), but also a desire to raise awareness of risk mitigation possible from a competent and well-resourced SAM practice.
The case in point was not a new issue however; Gartner has written about this very point for several years, and our latest guidance on the subject was published just last week: Customers Must Resolve SAP Indirect Access Risk When Investing in SAP Functionality. Similar issues which apply to Microsoft SQL licensing have been addressed by many organizations for more than ten years.
Demands for consumption of data across systems is a key part of many organizations digital future, however, such intelligence, automation and data sharing may in cases become prohibitively expensive as a result of indirect access licensing rules.
From a perspective of SAM, and its inherent value to business, the compliance oriented message in this case and associated press is less than positive. SAM best practice and discipline can deliver more value than eliminating compliance risk, which may make the investment in data collation and analysis more than worthwhile.
My colleague Victoria Barber points out that impacts on customer/vendor relationships resulting from any assumption that customer must be out of compliance is also problematic – having to constantly prove that you’re not breaching Ts & Cs is indicative of a lack of trust. A move to proactive SAM rather than a focus on audits/disputes is needed – compliance is a by-product of SAM and by encouraging good practices rather than punishing bad ones vendors (as well as their customers) may well reap long-term benefits.
Being engaged at the point of procurement and identifying risk which may be (at least in part) negotiated out of the contract in advance, is one such route to value.
In reality, licensing contracts can be excruciatingly complex. What’s more, technical advances and use of multiple environments or cloud platforms plus integration scenarios can add complexity – integration between systems will only continue to grow in today’s interconnected environment.
Accordingly putting in place a practice, necessary discipline, process, tools and resources will be key – not just to manage data and report on risk, but to develop intelligence and proactively identify risks which can be eliminated as part of the contracting process.
Note: Gartner’s prior research addressing SAP indirect licensing published in July 2014 can be located here
Credit also to Gartner analyst Bill Ryan
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