UK engineering firm. 3.4 million pounds off the Microsoft EA.

How a 9,000 seat UK engineering group turned an 18 percent renewal uplift into an 11 percent reduction, worth 3.4 million pounds over three years.

What was the situation going into the renewal?

The client is a UK headquartered engineering group with roughly 9,000 Microsoft seats across design, manufacturing, and corporate functions. Its three year Enterprise Agreement was expiring with a renewal quote 18 percent above the prior term.

The quote assumed full estate E5, a flat Azure commitment uplift, and Unified Support priced as a fixed percentage of the growing license spend. Each assumption was negotiable; none had been challenged.

Why the quote looked the way it did

• Profile inflation: the prior term's E3 to E5 step up was extended to the whole estate by default.
• Unverified counts: seat counts came from the reseller's records, not from the firm's identity systems.
• Bundled support: Unified Support rode the license number upward without separate scrutiny.

What did the engagement actually do?

The engagement ran the standard pre renewal sequence: measured usage inventory, license profile redesign, Azure commit rightsizing, and a negotiation strategy built on published terms rather than reseller framing. Twelve weeks separated the first inventory pull from the signed renewal.

The usage inventory

Telemetry showed 37 percent of E5 entitled users exercised any E5 only capability in the trailing six months. Security features carried the E5 case for a defined population; the rest of the estate fit E3, with the gap functions covered by standalone add ons priced against the Microsoft Product Terms.

The redesign

1. Profile split: 2,400 seats kept E5; 6,600 moved to E3 with targeted add ons, structured under the Microsoft Enterprise Agreement program.
2. Frontline reclassification: 700 manufacturing seats moved to F3 where usage matched the frontline profile on the published Microsoft 365 enterprise plans.
3. Azure commit reset: the commitment was rebased to trailing 12 month consumption priced against published Azure pricing, plus a 15 percent growth factor, with annual step ups replacing a flat three year number.
4. Support separation: Unified Support was negotiated as its own line, not a passenger on the license growth.

Where the common advice on EA renewals is wrong

The standard advice is to negotiate the discount percentage hard and early. We disagree. In roughly 20 of the 20 to 30 EA renewals Morten Andersen advised in 2024 to 2025, the profile mix moved two to three times more money than the discount did. The buyer side move on this engagement was exactly that: the E5 to E3 and F3 redesign produced most of the 3.4 million pounds before discount talks opened. Discount points on the wrong profile are still the wrong profile.

The renewal quote is the vendor's opening model of your laziness. Replace the model with measured usage and the number moves before the discount conversation starts.

What were the results and what holds them in place?

The signed renewal came in 3.4 million pounds below the opening quote over three years, an 11 percent reduction against the prior term while seat count grew slightly. The structure, not a one time discount, carries the saving.

• Annual profile review: a usage gate before each anniversary keeps E5 assignment tied to measured need.
• Azure step mechanics: annual commitment steps track actual consumption rather than a three year guess.
• Support cap: the Unified Support escalator is capped, breaking the automatic link to license growth.

What transfers to other estates

The levers are not exotic: measure before renewing, split profiles by role, rebase cloud commits to evidence, and never let support ride the license curve. Every one of them is available to any EA holder at any size.

What to do next

1. Pull six months of feature level usage telemetry for the whole estate.
2. Map the real E5, E3, and F3 populations from usage, not job titles.
3. Rebase the Azure commitment to trailing consumption plus a defensible growth rate.
4. Separate Unified Support into its own negotiation with its own cap.
5. Open the renewal conversation at T minus 6 months with the redesigned profile as your anchor.
6. Install an annual usage gate so the profile cannot drift back.

The Microsoft practice runs this sequence as a standard engagement, and more engagements like this one are in the case study library.

Frequently asked questions

How much did the engineering firm save on its Microsoft EA?

3.4 million pounds over the three year term against the opening renewal quote, an 11 percent reduction on the prior term while seat count grew slightly.

Where did most of the saving come from?

The license profile redesign. Moving 6,600 seats from proposed E5 to E3 with targeted add ons, and 700 seats to F3, moved two to three times more money than discount negotiation did.

How was the E5 population decided?

By measured usage. Six months of feature level telemetry showed which users exercised E5 only capabilities; 2,400 seats kept E5 on evidence, mostly for the security stack.

What happened to the Azure commitment?

It was rebased from a flat three year uplift to trailing 12 month consumption plus 15 percent growth, with annual step ups. That removed the shelfware risk baked into the original quote.

Can this approach work for smaller Microsoft estates?

Yes. The levers, measured usage, profile splits, commitment rebasing, and support separation, are structural and apply at any EA size, though the absolute savings scale with seats.