A German manufacturing group with 12,000 employees across Europe, North America, and Asia was managing Microsoft licensing through fragmented regional enrolments, resulting in duplicate licences, uncontrolled shelfware, and missed volume discounts. Redress Compliance conducted a global licence audit, consolidated all regions under a single EA, optimised the E5/E3 mix, eliminated hundreds of unused licences, and negotiated a 26% cost reduction — saving €5 million over three years while unifying the company’s global licensing strategy.
The client is a German manufacturing group headquartered in Munich, specialising in automotive components and industrial machinery. With approximately 12,000 employees worldwide, the company operates major facilities in Germany, the United States, China, and several other European and Asian markets. Annual revenue exceeds €4 billion, and the company is a Tier 1 supplier to several major European and Asian automotive OEMs.
The IT landscape reflects the company’s industrial heritage: core operations run on SAP ERP on-premises, while a growing adoption of cloud services supports collaboration, analytics, and emerging IoT initiatives for smart manufacturing. The Microsoft estate was extensive but fragmented. Microsoft 365 was deployed for all office staff across the group (a mix of E3 and E5 licences), with Project Online used for engineering project management, Visio Pro for technical design documentation, and a significant deployment of Power BI Pro for data analysis and production reporting.
Critically, each major region — Europe, North America, and Asia-Pacific — operated its own separate EA enrolment. The European enrolment was managed from Munich, the US enrolment through a separate American subsidiary with its own Microsoft reseller, and the Asia-Pacific licences were a mix of EA and standalone purchases. This fragmentation was the legacy of the company’s growth through acquisitions over the previous decade, where each acquired entity brought its own Microsoft contracts into the group without consolidation.
German automotive components and industrial machinery manufacturing. Tier 1 supplier to major European and Asian OEMs. Highly competitive sector requiring constant operational efficiency improvements and digital transformation investment in IoT and smart manufacturing.
Microsoft 365 E3/E5 (12,000 users across 3 regions), Project Online, Visio Pro (~500 licences), Power BI Pro, Azure (growing IoT/analytics workloads). Three separate regional EA enrolments plus standalone purchases through local resellers and MPSA agreements.
Headquarters in Munich, Germany. Major operations in the United States, China, Poland, Czech Republic, Mexico, and Japan. Each region had independently managed Microsoft licensing with different resellers, pricing currencies, and renewal dates creating significant administrative complexity.
€4 billion+ revenue, 12,000 employees worldwide. The Microsoft EA renewal represented a multi-million euro commitment that needed to support both current productivity requirements and the company’s strategic investment in cloud-based IoT and advanced manufacturing analytics.
The manufacturing group faced a complex set of interconnected challenges driven by years of fragmented licensing management, acquisition-driven growth, and a lack of centralised visibility across global Microsoft spend:
Three separate EA enrolments across Europe, North America, and Asia-Pacific meant three different renewal dates, three different pricing structures, and three different Microsoft account teams. This fragmentation created significant duplication: the US division purchased additional Visio and Project licences through a local reseller, unaware that Munich headquarters had spare licences allocated under the European EA. Similar overlaps existed across regions for Power BI Pro and Microsoft 365 add-ons. The company was paying for the same functionality multiple times simply because no single team had visibility across the global licence estate.
An internal audit revealed extensive over-licensing across the group. Approximately 500 Visio Pro licences were assigned company-wide, but only about 150 engineers used Visio regularly. Some employees had overlapping licences — for example, users with both an M365 E3 licence and a separate Exchange Online Plan from a migration that was never cleaned up. The Asia-Pacific operation, built partly through acquisitions, still had 300 users on standalone Office 2016 licences through an MPSA agreement that could have been folded into the EA. These inefficiencies collectively represented hundreds of thousands of euros in annual waste that had accumulated unchecked over multiple EA terms.
Microsoft’s renewal proposal recommended upgrading all 12,000 users to M365 E5 to leverage advanced security features, citing the company’s growing IoT infrastructure as justification. Microsoft also proposed a substantial Azure consumption commitment for IoT sensor data processing and analytics. However, the company was cautious: not all users needed E5 (factory-floor personnel had no use for advanced compliance or analytics features), and the IoT initiative was still in early stages with uncertain consumption requirements. There was a clear tension between Microsoft’s bundled approach and the company’s need for a right-fit solution that matched actual usage patterns.
The company had undergone a disruptive Microsoft licence compliance review two years earlier, which exposed gaps in their tracking processes. Despite this experience, they still lacked a centralised system for ensuring ongoing compliance without defensive over-purchasing. Each regional IT team managed licences independently using spreadsheets, with no single source of truth. Currency differences added complexity: the European EA was priced in euros while US licences were purchased in USD through a separate reseller, making it difficult to calculate true global spend or benchmark pricing effectively.
Redress Compliance was engaged to optimise and negotiate the EA renewal with a dual mandate: consolidate all regional agreements into a unified global EA and deliver significant cost reductions. The approach combined granular global audit work with strategic negotiation designed to leverage the company’s full international purchasing power:
We worked with IT teams in Germany, the United States, and Asia-Pacific to gather complete entitlement and usage data across all regional agreements. This audit immediately uncovered overlapping purchases, dormant licences, and users with duplicate assignments. We identified approximately 1,000 E5 users who were candidates for downgrading to E3, 500 Visio Pro licences where only 150 were actively used, and 300 standalone Office 2016 users on a legacy MPSA who could be migrated into the EA at lower per-user cost.
We designed a strategy to collapse all three regional enrolments into a single global EA with subsidiary true-ups, maximising volume discounts by combining the full 12,000-user count into Microsoft’s highest discount tier (Level D pricing). We proposed a tiered internal licensing model: approximately 5,000 power users (executives, R&D, cybersecurity, analytics) on M365 E5, and 6,500+ standard users on M365 E3 with targeted security add-ons where needed. All collaboration tools were standardised on Teams, eliminating residual Skype for Business deployments.
We presented Microsoft Germany’s global account team with the audit findings, demonstrating the extent of shelfware and E5 underutilisation. We negotiated volume-consolidated Level D pricing, a phased Azure commitment with guaranteed pricing for scale-up, competitive leverage (Google Workspace evaluation for non-technical users), and a contract structure allowing easy affiliate additions for future acquisitions. We also implemented SAM tooling and quarterly governance reviews.
The engagement delivered specific, measurable improvements across every dimension of the Microsoft estate — from licence optimisation and cost reduction to operational simplification and strategic alignment with the company’s manufacturing transformation agenda:
All Microsoft licensing across Europe, North America, and Asia-Pacific was consolidated under a single global Enterprise Agreement with subsidiary true-up provisions. This eliminated three separate renewal dates, three separate billing relationships, and the administrative burden of managing independent reseller contracts in multiple currencies. The consolidated volume of 12,000 users qualified the company for Microsoft’s Level D pricing tier, which provides significantly higher per-unit discounts than the regional agreements had individually achieved. Munich headquarters now has a single consolidated view of all Microsoft licences globally, with the ability to redistribute licences between regions as business needs change.
Approximately 1,000 users who held M365 E5 licences but were not using any E5-specific features were downgraded to E3. The final internal tiering allocated approximately 5,000 users (executives, R&D leadership, cybersecurity, legal, and data analytics teams) on M365 E5, with the remaining 6,500+ users on M365 E3. For users who needed specific E5 security features but not the full suite, Microsoft agreed to provide E5-level security capabilities as an add-on at a fraction of the E5 cost — a significant concession that avoided the blanket E5 upgrade Microsoft had proposed. This tiered approach ensured every user had the tools their role required while eliminating millions in unnecessary E5 spend.
The global audit identified and removed extensive shelfware: 350 unused Visio Pro licences (retained only the 150 actively used), duplicate Exchange Online Plans that overlapped with M365 assignments, the separate US Visio and Project purchases that duplicated European EA entitlements, and unused Dynamics and Power Platform licences from pilots that never expanded. The 300 standalone Office 2016 users from a previous acquisition were migrated into the EA as M365 E3 licences, providing modern tools at lower per-user cost while simplifying management. Total shelfware elimination contributed significantly to the overall 26% cost reduction.
Rather than accepting Microsoft’s proposed large upfront Azure commitment, we negotiated a phased approach: a modest initial Azure commitment covering the first year’s IoT sensor data and analytics projects, with a contractual option to increment the commitment in year two at the same discounted unit rate if the IoT initiatives proved successful. This protected the company from overcommitting to cloud spending before IoT use cases were validated, while securing favourable pricing that would lock in if the projects expanded. Microsoft, eager to establish Azure as the IoT platform, accepted this structure as it still guaranteed initial adoption with expansion upside.
Given the company’s growth-through-acquisition strategy, the EA contract included explicit provisions allowing any new affiliate or acquired entity to be added to the global agreement immediately, with the same pricing and terms, without requiring a separate contract negotiation. This was particularly important given the company’s history of acquisitions bringing separate Microsoft agreements into the group and the resulting fragmentation. Going forward, any acquired company can be onboarded onto the unified global licence structure within weeks rather than months, equipped with the standard toolset from day one.
The renegotiated global EA delivered transformative results across cost reduction, operational simplification, and strategic alignment. The 26% saving significantly exceeded the company’s initial expectations and established a new benchmark for IT procurement efficiency across the group:
| Outcome Dimension | Result | Detail |
|---|---|---|
| Total Savings | €5M / 26% | 26% cost reduction versus a straight renewal on previous terms. Savings came from volume consolidation (Level D pricing), E5/E3 optimisation, shelfware elimination, and negotiated discounts. IT cost per employee decreased while tooling capability improved. |
| Global Unification | 3 → 1 EA | Three regional enrolments consolidated into a single global agreement with one renewal date, one consolidated bill, and one master set of terms. Central IT in Munich now has complete global visibility and the ability to redistribute licences across regions. |
| Licence Optimisation | 1,000+ E5 downgrades | 1,000+ unnecessary E5 licences downgraded to E3 with targeted add-ons. 350 unused Visio Pro licences reclaimed. Duplicate Exchange Online Plans removed. 300 legacy MPSA users migrated to EA at lower cost. |
| Azure Structure | Phased commitment | Modest initial IoT commitment with guaranteed pricing for year-two expansion. Company can scale Azure based on proven ROI rather than speculative forecasts. No overcommitment risk. |
| Compliance | Centralised & automated | SAM tooling implemented with quarterly usage reviews. Near real-time visibility into licence utilisation across all regions. Shelfware accumulation risk eliminated through automated provisioning and reclamation processes. |
The engagement followed a structured 5-month timeline, with the additional complexity of coordinating across three regional IT teams in different time zones and managing multiple Microsoft account relationships:
| Phase | Duration | Key Activities |
|---|---|---|
| Month 1: Global Discovery | 4 weeks | Cross-regional audit coordination with IT teams in Munich, Chicago, and Shanghai. Collected entitlement data from all three EA enrolments, the US reseller, MPSA agreements, and standalone purchases. Built complete global licence inventory for the first time. |
| Month 2: Analysis & Strategy | 4 weeks | E5 usage analysis across all 12,000 users. Shelfware identification and quantification. Volume consolidation modelling (Level D pricing impact). Tiered licensing model design. Phased Azure commitment structure. Competitive positioning research (Google Workspace evaluation). |
| Month 3: Pre-Negotiation | 4 weeks | Internal stakeholder alignment (CFO, CIO, regional IT leads). Negotiation targets and red lines defined. Presentation materials prepared for Microsoft Germany global account team. Acquisition-ready contract clause drafting. |
| Month 4: Negotiation | 4 weeks | Led commercial negotiations with Microsoft Germany. Presented global audit findings. Multiple counter-proposal rounds on pricing, E5/E3 mix, Azure structure, and contract flexibility terms. Secured Level D pricing, phased Azure, and affiliate provisions. |
| Month 5: Execution | 4 weeks | Contract finalisation and signing. Regional migration to unified global EA. SAM tooling deployed. Legacy MPSA users migrated. Governance framework delivered with quarterly review structure, automated licence lifecycle management, and executive reporting templates. |
A critical deliverable beyond the negotiation itself was establishing the governance infrastructure to prevent the fragmentation and shelfware accumulation that had characterised the previous EA terms:
Structured quarterly reviews examining M365 feature utilisation, Visio and Project active usage rates, Power BI Pro consumption, and Azure resource utilisation across all regions. In the first quarter post-renewal, this process identified 100 Visio and 200 Power BI Pro licences that were allocated but unused, which were reclaimed into a reserve pool.
Software asset management tools integrated with the Microsoft 365 admin centre provide near real-time visibility into licence assignment and usage by user, department, and region. Munich headquarters can now track global utilisation from a single dashboard, identifying underused licences before they become shelfware and redistributing between regions as needed.
Licence provisioning and deprovisioning integrated into HR onboarding and offboarding processes across all regions. When an employee joins, the correct licence tier is automatically assigned based on their role classification. When they depart, licences are reclaimed within 48 hours. This eliminates the dormant licence accumulation that contributed to significant waste in the previous EA period.
Standardised process for onboarding acquired companies onto the global EA. When the company acquires a new entity, IT procurement follows a documented playbook to inventory existing Microsoft licensing, identify overlaps, migrate users onto the unified agreement, and right-size licences — preventing the patchwork that fragmented the previous estate.
This engagement illustrates several principles that apply broadly to any multinational manufacturer or industrial group managing Microsoft licensing across multiple regions and business units. These lessons are drawn directly from the patterns we identified and the negotiation strategies that proved most effective:
Microsoft’s EA pricing tiers reward volume: the more users and products under a single agreement, the higher the discount tier. Companies that manage licensing through multiple regional agreements, local resellers, and standalone purchases are almost certainly leaving significant discount uplift on the table. In this case, consolidating from three regional enrolments to one global EA moved the company from Level B/C pricing to Level D — the highest discount tier — which alone contributed a substantial portion of the 26% savings.
Without a single, comprehensive view of all Microsoft licences across every region, optimisation is impossible. The German manufacturer did not realise the US division was purchasing Visio and Project licences that were already available under the European EA, or that hundreds of users had duplicate assignments from unmaintained migrations. The global audit was the single most impactful action in the engagement — it created the factual baseline that made every subsequent optimisation and negotiation position possible.
Microsoft consistently pushes large upfront Azure commitments, particularly for companies with IoT and analytics ambitions. However, early-stage IoT deployments have highly uncertain consumption profiles. A phased commitment — modest initial spend with guaranteed pricing for expansion — protects against overcommitment while preserving the ability to scale at favourable rates once demand is validated. This approach aligned Azure spending with the company’s manufacturing transformation roadmap rather than with Microsoft’s sales targets.
For companies with active M&A strategies, explicit provisions allowing new affiliates to join the EA at existing pricing and terms are essential. Without these provisions, each acquisition brings a new set of Microsoft contracts that gradually fragment the estate — exactly the problem this company had accumulated over a decade of growth. The clause costs nothing to include but saves significant time, money, and administrative effort every time an acquisition closes.
The company was deeply committed to Microsoft for productivity and collaboration, making a full platform switch unlikely. However, signalling that Google Workspace was being evaluated for specific user populations (particularly factory-floor and frontline workers) created genuine pricing pressure. Microsoft’s response was notably more flexible once the competitive alternative was credible. Even organisations that intend to remain on Microsoft should develop and present competitive alternatives to maximise negotiation leverage.
“Our Microsoft licensing was like a puzzle scattered around the world — now it’s finally a complete picture. Redress Compliance helped us consolidate everything, eliminate the waste, and dramatically cut our costs. We saved 26% and at the same time made our IT more powerful. Every euro we spend on Microsoft now is a euro delivering value to our business, not leaking out on inefficiency.” — Head of IT Procurement, German Manufacturing Group
This engagement represents a pattern we encounter frequently in global manufacturing groups and other multinational enterprises: years of fragmented licensing management through regional agreements, local resellers, and standalone purchases have created a hidden cost structure that no single team can see or control. Microsoft benefits from this fragmentation because it prevents the customer from leveraging their full purchasing power and creates opportunities for duplicate sales and E5 upselling.
The German manufacturer’s experience demonstrates that consolidation alone — before any negotiation begins — typically unlocks 10–15% savings simply through volume discount tier uplift and shelfware elimination. Combined with E5/E3 optimisation and strategic negotiation, total savings of 20–30% are consistently achievable for companies willing to invest in a comprehensive global audit and take a data-driven approach to the renewal.
For any multinational manufacturer approaching a Microsoft EA renewal, the principle is clear: consolidate regional agreements into a single global EA, conduct a thorough usage audit before engaging with Microsoft, design a tiered licensing model that matches actual usage patterns, and negotiate with the full weight of your global volume. The savings are substantial and the operational simplification is transformative, delivering benefits that compound over the full EA term and beyond.
The savings from consolidation depend on the current fragmentation level and the combined volume, but typically range from 10–20% through volume discount tier uplift alone. Microsoft’s EA pricing has distinct discount levels (A through D) based on total licence count. Companies with regional agreements often sit at Level B or C individually, but when consolidated, their combined volume qualifies for Level D — the highest tier with the deepest per-unit discounts. In this case, the consolidation uplift contributed approximately 10% of the total 26% savings.
Under a global EA with subsidiary enrolments, each subsidiary can manage its own licence true-ups (adding or adjusting licences) while the master agreement governs pricing, terms, and volume thresholds. The central IT team maintains visibility into all subsidiaries’ licence positions. True-ups are typically annual, and the global agreement allows licence redistribution between subsidiaries without additional purchases when one region has surplus while another has a shortfall.
Yes, when negotiated explicitly. In this engagement, the contract included a provision that any increase to the Azure commitment in year two or three would receive the same per-unit pricing as the initial commitment. This is not a standard Microsoft offering — it must be negotiated as a specific contractual term. Microsoft was willing to agree because the initial commitment established Azure adoption, and the guaranteed pricing for expansion incentivised the customer to scale on Azure rather than evaluate alternatives.
Even organisations with no intention of fully switching away from Microsoft can create genuine pricing pressure by evaluating alternatives for specific user populations. In manufacturing, frontline and factory-floor workers are a natural candidate population for alternatives like Google Workspace, which is significantly cheaper for basic email and collaboration. Microsoft responds to this competitive signal because losing any portion of the user base undermines their per-seat revenue model and creates a foothold for competitors.
A full consolidation engagement — from global audit through to unified EA execution — typically takes 4–6 months depending on the number of regions and the complexity of existing agreements. The most time-consuming phase is the initial global audit, which requires coordination across regional IT teams to gather complete entitlement and usage data. Once the data is consolidated, the strategy design, negotiation, and contract execution phases can proceed efficiently.
Three mechanisms are essential: first, SAM tooling with centralised dashboards that give headquarters real-time visibility into licence assignments and usage across all regions. Second, governance processes including quarterly usage reviews and automated licence lifecycle management tied to HR systems. Third, contractual provisions that make it easy to add new affiliates and acquisitions to the existing EA rather than establishing separate agreements. Together, these prevent the gradual re-fragmentation that occurs when regional teams revert to independent purchasing.
Fragmented regional agreements cost global companies millions in missed volume discounts and duplicate purchases. Redress Compliance provides global licence audits, EA consolidation, E5/E3 optimisation, and negotiation support — unifying your Microsoft licensing for maximum efficiency and minimum cost.
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