SAP Raising Support Rates

[admin]

Finally some good news but I want to see the exact details of the KPI's agreed:

Enterprise users put SAP on notice

AustralianIT | Fran Foo | May 01, 2009

"Prove it or lose it."

This is the message SAP user groups have given the software giant in light of maintenance fee increases.

In short, if performance tanks, SAP won't be paid.

SAP last year unveiled Enterprise Support, a new maintenance structure that raises support costs to 22 per cent of licensing fees.

Predictably, the news didn't bode well with customers, and user groups have been in discussions with SAP to ease the pain.

The price spike will still go ahead but SAP has decided to give customers some breathing space through smaller increments.

SAP said it would extend the four-step price increase program by three years, from 2012 to 2015.

But users will keep a watchful eye via their own KPI Index, a set of key performance indicators that track SAP enterprise support levels.

The index will be developed by the SAP user group executive network (SUGEN), comprising 12 user groups from around the world.

Some 100 SAP customers globally will be involved in creating the index, with less than a dozen Australian customers contributing to the process.

The index will cover 11 KPIs under four categories: business continuity; business process improvement; protection of investment and total cost of operations.

SAP Australian User Group (SAUG) chairperson Grahame Reynolds said that if KPIs were not met, SAP would not be able to charge the extra fees.

"The index will be used to measure the benefits SAP enterprise support provides to customers and subsequent increases in the cost of enterprise support for increments in the coming years until 2015," Mr Reynolds said.

"SAP have told their customers there are certain benefits from enterprise support. They've agreed to back themselves, so the index will be used to measure that value.

"The application of the increments will be dependent on whether these KPIs are met. We see this as a win-win situation.”

SAP's local customers include the Commonwealth Bank, NSW Department of Education, Woolworths, Australia Post and 7-11.

SAP this week posted an 8 per cent decline in operating profit globally in the first quarter ending March 31. Software revenue dipped 33 per cent to 418 million euros ($759 million) and net profit decreased 16 per cent to 204 million euros.