How Redress Compliance helped a 25,000-employee German automotive parts manufacturer avoid €4M in indirect usage audit exposure and negotiate a phased, cost-optimized RISE with SAP migration.
A German automotive parts manufacturer with 25,000 employees and global operations relied on SAP ECC for decades. With SAP pushing the 2027 deadline to move to S/4HANA, the firm considered RISE with SAP for a cloud-based S/4HANA transition.
SAP’s proposal offered an all-inclusive RISE deal covering ERP and certain SAP Business Network add-ons. However, the company had highly customised processes and multiple production plants on different SAP instances.
They were not convinced a one-size-fits-all migration would work. The German SAP user group (DSAG) had also advised caution regarding RISE costs, prompting the company to proceed carefully and engage Redress Compliance for independent advisory support.
The manufacturer faced three critical challenges that threatened both budget and operational continuity:
SAP demanded migrating all systems simultaneously into a single RISE contract. This disregarded the company’s phased rollout plan and included cloud services for plants not ready to transition. A forced simultaneous migration across multiple global factories risked production disruption and budget overruns.
The quoted price (tens of millions of Euros) appeared inflated with unused capacity. DSAG analysis indicated SAP had overpriced the package versus actual ramp-up needs. The company would be paying for cloud infrastructure and services across all plants from day one, even though most factories would not migrate for months or years.
The company’s supplier portal interfaces constituted indirect usage under SAP’s licensing rules, exposing them to over €4 million in potential audit fees if unresolved before migration. Simply moving to RISE would not erase these compliance issues. SAP could use them as leverage during negotiations.
| Challenge | Risk | Impact |
|---|---|---|
| “Big Bang” Pressure | SAP demanded migrating all systems simultaneously into a single RISE contract | Disregarded phased rollout plan; included services for plants not ready |
| High Cost / Unclear Value | Quoted price inflated with unused capacity | DSAG analysis indicated overpricing vs. actual ramp-up needs |
| Compliance / Indirect Use | Supplier portal interfaces constituted indirect usage | Over €4M in potential audit fees if unresolved |
Redress Compliance delivered a four-part advisory engagement covering license assessment, migration strategy, cost negotiation, and compliance resolution.
Redress conducted a comprehensive review of the SAP landscape using SAP’s tools (LAW reports) to pinpoint over- and under-licensing. This audit quantified the indirect usage exposure, specifically the number of supplier portal documents that violated SAP’s digital access rules. With that data, Redress devised a plan to either negotiate these into the RISE contract or remediate them upfront.
Redress proposed and negotiated a phased approach despite SAP’s resistance. Instead of a single big go-live, the contract allowed for a phased migration by region. Crucially, SAP agreed to dual-use licensing during the transition: the client could run ECC and S/4HANA in parallel without incurring additional fees.
The team unbundled RISE pricing, allowing the company to pay only for what it needed, when it needed it. Redress leveraged benchmarks from DSAG and other enterprises to negotiate substantial discounts. The ramp-up payment structure ensured the manufacturer was not paying for idle cloud capacity across factories that had not yet migrated.
A major win was integrating compliance resolutions directly into the RISE contract. SAP agreed to waive any past indirect usage claims, an amnesty on the supplier portal issue once the client moved to RISE. This eliminated the €4M+ exposure and gave the company a clean compliance slate entering the cloud.
Facing a RISE with SAP migration? Redress Compliance provides independent advisory on phased migration, compliance resolution, RISE unbundling, and cost negotiation. We work for you, not SAP.
SAP RISE Advisory →| Metric | Result |
|---|---|
| Cost Reduction | ~30% under SAP’s initial RISE quote |
| Compliance Risk Eliminated | €4M+ indirect usage exposure resolved with clean slate entering RISE |
| Migration Approach | Phased, factory-by-factory rollout aligned with operational readiness |
| Payment Structure | Ramp-up schedule matching deployment; no upfront payment for idle capacity |
| Dual-Use Rights | ECC and S/4HANA in parallel during transition at no extra license cost |
| Flexibility | Option to pause between phases without breaching the contract |
The project will proceed on the company’s terms: a stepwise cloud migration aligned with their readiness. SAP’s original terms were transformed into a client-centric arrangement. IT leadership noted that for the first time, they feel in control of an SAP project rather than coerced, able to report to the board that the RISE move will deliver value without unwelcome surprises.
“We had heard from DSAG and others not to accept SAP’s first offer, and Redress helped us prove why. They turned SAP’s big-bang plan into something that fits how we operate. Most importantly, we erased a huge compliance worry in the process. Redress saved us from a potential licensing disaster and got us a deal we can actually work with.”CIO, Automotive Manufacturer (Germany)
This engagement illustrates several principles that apply to any enterprise facing a RISE with SAP migration:
Do not accept “big bang” proposals at face value. SAP’s cloud targets may not align with your operational reality. A phased migration protects both budget and business continuity.
Quantify compliance exposure before negotiating. Knowing your exact indirect usage liability gives you leverage and lets you negotiate amnesty as part of the deal rather than paying penalties separately.
Unbundle RISE pricing. The all-inclusive package often includes capacity you will not use for years. Insist on paying for what you need, when you need it, with a ramp-up schedule tied to actual deployment.
Secure dual-use rights in writing. Running old and new systems in parallel is operationally necessary. Ensure the contract explicitly allows this without double-licensing fees.
Use independent benchmarks. DSAG data and peer enterprise benchmarks provide concrete evidence that SAP’s initial pricing is negotiable, often significantly so.
For the full decision framework, see CIO Playbook: RISE with SAP vs Traditional On-Premise Licensing.
The manufacturer had data interfaces with suppliers through a portal that constituted indirect usage under SAP’s licensing rules. This exposed them to over €4 million in potential audit fees, a liability that needed to be resolved before or during the RISE migration.
By unbundling RISE pricing, removing or delaying services not immediately required, leveraging DSAG benchmarks, and negotiating a payment schedule that ramps up only as new sites go live. This avoided huge upfront costs for idle capacity.
Dual-use licensing allows you to run both the old SAP ECC system and the new S/4HANA Cloud system simultaneously during the transition period without paying additional license fees. This is essential for phased migrations where factories or regions cut over at different times.
Yes. As part of a RISE migration deal, SAP can agree to an amnesty on historical indirect usage issues. This was negotiated as a “compliance safe harbour”: once the client moved to RISE, known indirect usage was contractually settled and cleared.
SAP often pushes for simultaneous migration, but phased approaches are negotiable. The key is having clear data on your landscape complexity and a firm business case for why phased rollout is necessary. Independent advisory support strengthens this position significantly.
Timelines vary by organisation size and complexity. For a 25,000-employee manufacturer with multiple global plants, a phased migration might span 2 to 4 years with regions cutting over sequentially. The contract should allow flexibility to pause between phases if needed.
DSAG (the German SAP User Group) had published analysis indicating that RISE pricing often carried higher base rates than traditional licensing. This independent data gave the manufacturer concrete evidence to challenge SAP’s initial quote and negotiate better terms.
Before. The earlier you engage independent advisory support, the better positioned you are. Pre-negotiation assessment of your license landscape, compliance exposure, and benchmark pricing gives you maximum leverage when SAP presents their proposal.
Redress Compliance has helped hundreds of Fortune 500 enterprises, typically saving 15 to 35% on renewals and new deals. 100% vendor-independent. No commercial relationships with any software vendor.