A Tier-1 European insurer rebuilt its Named User band assignment methodology, reclassified more than nine thousand users on activity evidence, and reduced the renewal forecast by five point six million dollars.
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The insurer's SAP renewal cycle was eighteen months out, with a forecast that the renewal would land approximately five to seven million dollars above the prior contract value on a like-for-like basis. The forecast was driven by Named User growth: the contracted Named User entitlement had been exceeded by approximately 6,400 users over the prior three years, accumulating through operational growth, acquisitions, and the SuccessFactors deployment.
Internal procurement had escalated the forecast to the CFO and was preparing for a price negotiation with SAP based on accepting the additional Named User count. The classification methodology in use was role-based and assigned every user to the highest band that any of their assigned role-collections justified — a methodology that maximises the licence count and provides no defence against further classification challenge.
The procurement leadership engaged us with a brief to reset the classification methodology before the renewal negotiation, with the explicit aim of reducing the entitlement requirement rather than negotiating a better price for the inflated entitlement.
We took the engagement on a renewal-preparation basis — no active audit, but a renewal with significant commercial exposure. The methodology brief was the same as we apply to USMM remediation: evidence-based classification using transaction history over a defined window, documented in a per-user evidence file.
The analysis covered the full Named User population of approximately 34,000. The classification window was twelve months. The cross-reference was against transaction-history data exported from the SAP estate and analysed user by user. The output was a reclassification recommendation for 9,200 users where the activity evidence supported a lower band than the role-based assignment.
The 9,200 reclassifications broke into: 3,800 Professional-to-Limited-Professional moves, 2,600 Limited-Professional-to-Employee-Self-Service moves, 1,400 Professional-to-Employee-Self-Service moves where the user had no transactional activity beyond expense reporting, and 1,400 retirements where the user account was still active but had no transactional activity at all over the twelve-month window.
We then ran the reclassification through the SAP estate as a controlled change, with rollback procedures in place. The change was applied across three release windows over six weeks. The output was a Named User population that matched the contracted entitlement with approximately 1,200 users of headroom, against the prior position of 6,400 users over-entitlement.
The renewal forecast was revised down by five point six million dollars from the pre-engagement projection. The contracted Named User entitlement was renewed at the existing level rather than at the inflated level the original forecast had assumed. The renewal closed within the original contract floor.
The internal SAM function adopted the activity-based classification methodology as a continuous programme, with quarterly reclassification reviews. The 1,200 users of headroom was reserved as growth capacity for the next acquisition cycle, removing the need for an interim Named User purchase.
Total elapsed time from engagement to completed reclassification was eighteen weeks. The renewal negotiation followed in the subsequent quarter on the corrected baseline.
We were negotiating a price on the wrong number. The work was to fix the number first, then negotiate. The negotiation became easy after that.
Reclassify users. Retire shelfware. Right-size engine metrics. The continuous reduction programme that runs between the audit cycles, year after year.
Read the brief →A pre-audit examination of named users, engine measurements, and indirect-access pathways. We surface the exposure before SAP does, and we quantify the remediation cost.
Read the brief →Professional, Limited Professional, Employee Self-Service. The band definitions and the reclassification thresholds.
What runs between the audit cycles. The reclassification cadence, the shelfware retirement, the engine right-sizing.
How a global media group reclassified 6,800 users on transaction evidence and removed $5.1M from a pending audit claim.
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