Taking a MultiDimensional Approach to SAP Indirect Access

What This Article Covers

  • The Way Indirect Access is Often Presented
  • Who Are The Providers of Information on Indirect Access?
  • The Important Dimensions of Indirect Access
  • Locking Down Information to Your SAP Consulting Company

Introduction

This article is directed towards clients of mine regarding how to best resolve SAP indirect access claims. This article was motived by the fact that I have had many conversations with clients and prospects who asked what it takes to get past the claim and what is involved. So this article is essentially the explanation that I provide, and since I have provided it orally I thought it made sense to have it in a documented and shareable form.

A good place to start is to review the providers of information on indirect access.

Who are The Providers of Information on Indirect Access?

The following entities provide information on indirect access and SAP.

  • *SAP: SAP provides very little information on indirect access. Their intent is to be as ethereal as possible on the topic. They also release false information on the topic, as I covered in the article How to Best Understand SAP’s Indirect Access Announcement.
  • *Most IT Media Outlets (ComputerWeekly, Gartner, Diginomica, CIO): Recipients of money from SAP, they seek to seem authoritative on the topic while also accepting most of SAP’s assumptions about indirect access. They want to cover the story like a sporting event rather than providing any real insight. And because of funding, they must side with SAP, but without appearing to do so. SAP remotely controls most media outlets through funding. I estimate that Gartner receives over $100 million per year from SAP, and unsurprisingly, Gartner will not disclose the amount. If you are getting paid by SAP, then you cannot provide unbiased information on indirect access, which is an issue that is against customer’s interests and 100% in SAP’s interests.
  • *ASUG: A puppet of SAP that pretends to represent users interests, ASUG distributes false information on indirect access as covered in the article ASUG’s Biased and Inaccurate Article on Indirect Access. ASUG wants to help customers negotiate with SAP and has written articles proposing that they can be an honest broker, when in fact, they would instead gang up on the customer while pretending to serve an independent role. I have never participated in a negotiation with ASUG, but given what they have published on the topic they would reinforce SAP’s position, while most likely stressing the importance of coming to a reconciliation….on SAP’s terms of course. Afterward, the ASUG rep will call his buddies at SAP and most likely laugh about it.
  • #Various SAP Contract Negotiation Entities: Some entities perform contract negotiation for SAP customers. That is they sit opposite of SAP and use their experience in a number of negotiations to try to get the best deal for customers. They very strongly tend to present coming to a resolution on an indirect access claim as all about reviewing the contract, when in fact this is a small part of the puzzle. The parts of the SAP license agreement that deal with indirect access is normally just a few lines.
  • UpperEdge: UpperEdge is a contract negotiating entity, but they differ from most in that they have expertise in indirect access and have shown the willingness to challenge SAP on this topic. They also do not present the commonly presented simplistic platitude that all one needs to do is review the contract. I have been careful to read all of UpperEdge’s material on this indirect access.
  • *SAP Consulting Companies: Like SAP they prefer if their clients don’t know about indirect access as it interferes with software sales and therefore implementation money. One would have to be quite unknowledgeable to use a consulting company that is an SAP partner to negotiate with SAP, as they have more allegiance to SAP than to their clients. But the SAP consulting companies share roughly the same view of indirect access as the contract negotiating entities publicly. Although they are far more disingenuous as they leave out the fact that they cannot represent any customer’s interest against SAP.
  • License Software Companies or SAM: Companies like Snow Software sell software that describes the state of a company’s indirect access (as well as other licensing) liabilities. Their software is loaded onto SAP and performs an audit of the liabilities. They want to sell software and support customers in their indirect access battles with SAP, but as they are partners with SAP they must be careful to not say things publicly that would place their partnership in jeopardy. This is not a criticism per se, these types of companies are in a tight spot and simply don’t have the latitude to share a lot of what they know publicly.
  • Attorneys: Attorneys don’t tend to publish on indirect access. With UpperEdge, which both specializes in contract negotiation and is staffed with attorneys, being the exception. Once an indirect access claim becomes large enough, or obviously if a lawsuit is filed as in the case with Diageo and InBev, then the attorneys come into the picture. Customers have their own general counsel, but one requires a specialized type of attorney that is focused on similar types of law related to indirect access. Outside of the very few attorneys that have any indirect access experience, they will need to work with an expert witness to fill provide the context, industry standards, etc..

Symbol Key

*Providers of false information on indirect access

#Providers of often limited information on indirect access

The Dimensions of Indirect Access

Something I have begun to conclude after researching indirect access is that handling an indirect access claim from SAP requires multiple dimensions of knowledge. And no one group really has the complete answer. But some entities really can’t be part of the answer because they are in some way controlled by SAP. ASUG and SAP consulting companies being the perfect example of this. I see the following necessity for information to come to the best possible resolution on indirect access.

  1. Likelihood Determination: You must know the likelihood that you will receive an indirect access claim. There are important markers that will tend to result in SAP bringing an indirect access claim against a customer. I have a future article on this topic planned. Likelihood determination is critical because after SAP brings the claim if the customer is not prepared, they face deliberately restricted timelines for providing a response.
  2. True Indirect Access Exposure: When SAP brings an indirect access claim it will nearly always overestimate the customer’s exposure. SAP is trying to arm twist the customer into license purchases, that is all that an indirect access claim is about. It is important to not lose sight of that fact. True indirect access license exposure can only be determined by software like Snow or Voquz. This is software that describes the usage of the system. The system output is the customer’s weapon against SAP’s claim.
  3. Contract Negotiation: The customer must have contract negotiation expertise. This can be an attorney but does not have to be. There are many contract negotiators that know SAP contracts and that is their expertise. Using the company’s internal procurement team, that focuses on price is not going to be a good fit for this negotiation.
  4. Attorneys: If the claim is big enough, then it can make sense reach out to outside legal. But normally the first few rounds will not require an attorney. If a law firm is contacted, in most cases the customer will spend a lot of money in just getting the firm up to speed on what indirect access is, which will often result in paying them to read articles on indirect access, in either a SAM vendor or me being contacted to explain what indirect access is, its history, etc. Again UpperEdge breaks the mold as they are both legal and contract negotiators and have indirect access expertise. Therefore they defy my categories. But very few indirect access claims will ever even result in the necessity to write up or file legal documents.
  5. Research & Standards: Both a contract negotiation and most attorneys will require an SME. That is a role that I fill. I am actively researching how SAP tends to use indirect access and what it accepts. When an indirect access claim is brought, it is controlled by the SAP account executive. The account executive will have spoken with their management and will have received the approval to bring the claim. And the reason it is brought is always the same. The account executive has concluded that they can sell more software by bringing the claim than through trying to sell software normally. And every single SAP account has indirect access liability under SAP’s interpretation of indirect access. Indirect access is very simply a hammer to be used against customers that are “drifting.”

Locking Down Information to Your SAP Consulting Company

There is also one party that needs to be kept in the dark regarding any indirect access preparation and particularly when fighting the claim. And that is the SAP consulting company (if they happen to be on the account). If information is shared with an SAP consulting partners, they will most often go back and share the information with their contacts in SAP. To be involved in a negotiation a claim with SAP, and have ever step of your strategy then communicated to SAP through your consulting partner puts you at a serious disadvantage versus SAP. Remember that SAP consultancies are constantly competing with each other to ingratiate themselves to SAP, and offering inside information like an ongoing indirect access claim is a great way to do it. The partner account manager for the consulting company on the account knows your SAP account executive, and it is a simple matter to either directly tell him what the score is inside your company, or if he is more subtle to “indicate” what is happening without overtly saying it. In fact, there is nothing to stop the account executive from contacting the consulting partner and asking. No rule would have been broken.

Conclusion

Preparing for a potential indirect access claim and responding to it is a multidimensional effort. There is a step one, however. And step one is to remove entities that seek to provide information that cannot demonstrate financial independence from SAP. This includes SAP, almost all media entities, ASUG and SAP consulting partners. If we cannot agree to use unbiased sources to come to a resolution, then the game is lost before it has begun. Step two is figuring out who can add value where. This means using the specialization of each party based upon their true domain expertise.

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