How Redress Compliance helped a Dutch manufacturing conglomerate save €7M by consolidating multi-subsidiary agreements, eliminating shelfware across 15,000 users, right-sizing Azure commitments with burst flexibility, and securing Level C volume discounts for global operations.
A Dutch manufacturing conglomerate headquartered in Eindhoven, Netherlands, engaged Redress Compliance to overhaul its Microsoft Enterprise Agreement. The company has 15,000 employees worldwide (approximately 5,000 in the Netherlands) and €5 billion in annual revenue. Operations span industrial equipment manufacturing and IoT solutions, with factories and offices across Europe, North America, and Asia.
The Microsoft product landscape included Microsoft 365 for knowledge workers (primarily E3, with E5 for engineering and security teams), a significant on-premises footprint (Windows Server, SQL Server under EA with Software Assurance), growing Azure usage for IoT data collection and analytics, Dynamics 365 Finance & Operations for global supply chain management, and Power Platform for custom factory-floor applications.
The existing EA was expiring in Q4, and the company's goals were to cut costs, remove unused services, and ensure the new agreement supported their gradual cloud migration without being locked into unneeded spend.
The manufacturing firm faced rising costs, structural inefficiencies, and fragmented agreements across its global subsidiaries.
Microsoft's renewal proposal assumed a 30% increase in Azure commitment to support digital transformation projects. However, some cloud pilots (including AI-driven predictive maintenance) were still in R&D. Committing upfront to Azure capacity for projects that might stall or take a different direction created significant financial risk.
The EA had accumulated various unused extras over the years. 500 Power Apps licences were purchased for citizen development across factories, but only 50 were actively used. M365 A5 Security add-ons duplicated capabilities already covered by third-party security tools. On the Dynamics 365 side, more module licences were being paid for than deployed, due to an incomplete rollout in Asia.
Multiple subsidiaries maintained separate Microsoft agreements, preventing the company from leveraging its true global scale. Microsoft's initial quote did not reflect any multi-affiliate benefit — despite the combined spend clearly qualifying for higher-tier volume discounts.
The company was double-paying for endpoint protection: Microsoft Defender via M365 E5 Security add-ons and a separate third-party security product. Additionally, over 1,000 M365 licences were assigned to former employees or unassigned accounts — partly from M&A activity and slow de-provisioning across regions.
Redress Compliance executed a four-phase strategy that combined global consolidation, rigorous right-sizing, aggressive negotiation, and long-term governance planning.
Redress performed a comprehensive audit across all regions and subsidiaries — tallying M365 licence usage, evaluating Dynamics 365 utilisation by factory, and assessing Azure consumption versus commitments in each geography. They discovered that one European division and one Asian subsidiary had separate EA contracts that, if pooled with HQ's EA, would elevate the company from EA Level B to Level C discount brackets — unlocking larger baseline discounts. The audit revealed 1,000+ ghost M365 licences, confirmed 450 of 500 Power Apps licences were idle, and identified the security tool overlap.
Using audit data, Redress designed a leaner EA: E5 maintained only for ~1,000 users who truly benefit (cybersecurity, senior engineers), E3 for knowledge workers, and M365 F3 introduced for factory floor supervisors needing only email and Teams. A5 Security add-ons were eliminated (the company consolidated on Microsoft's security suite, phasing out the third-party tool). Power Apps reduced from 500 to 50 licences. Dynamics 365 trimmed 20% for undeployed regions. On Azure, Redress proposed only a 10% commitment increase (vs. Microsoft's 30%) with burst flexibility — ability to exceed commit at the same discounted rate. Dev/test Azure workloads were moved to MCA subscriptions outside the rigid EA commitment.
Redress entered negotiations with the consolidation strategy and a clear list of needs. The unified global licensing picture moved Microsoft to offer Level C discounts. Combined with line-by-line optimisation, the team achieved a 22% overall cost reduction from Microsoft's initial proposal. Key wins: Level C rates applied to all licences (including formerly separate agreements); reduced Dynamics 365 pricing; Azure burst capacity clause (overages at committed rates); mid-term true-up/down rights for potential divestitures; and removal of shelfware with clauses to re-add at negotiated pricing if adoption takes off — a no-cost option for future use.
Redress helped outline a three-year roadmap balancing cloud adoption with cost control. As factories modernise and adopt Azure IoT services, the roadmap has triggers to re-evaluate EA commitment at renewal with pilot data. Software Assurance benefits were mapped for Azure Hybrid Benefit (saving up to 40% on Windows/Linux VMs). A central monitoring system was established across all merged entities to prevent licence fragmentation. New technology adoption (AI tools, advanced analytics) follows a "pilot first, EA second" discipline — small-scale subscriptions prove value before incorporation into the EA.
| Metric | Before (Microsoft's Proposal) | After (Negotiated Terms) |
|---|---|---|
| 3-Year EA Value | ~€32M | ~€25M (22% savings) |
| Discount Level | Level B (fragmented agreements) | Level C (consolidated global EA) |
| Ghost / Unused Licences | 1,000+ M365 + 450 Power Apps + Dynamics excess | All reclaimed — zero shelfware at signing |
| Azure Commitment | 30% increase demanded | 10% increase + burst flexibility at same rate |
| Security Overlap | Double-paying (Microsoft + third-party) | Consolidated on Microsoft suite |
| Agreement Structure | 3 separate contracts, no volume leverage | Single global EA with mid-term flex |
The restructured EA delivered a 22% cost reduction — €32M reduced to €25M. Part came from eliminating waste (unused licences, security overlap), part from Level C volume discounts unlocked by consolidation. The CFO noted the Microsoft budget line is now set to be lower next year than last year — a rare win in a time of rising software costs.
1,000+ ghost M365 licences, 450 idle Power Apps, and excess Dynamics seats were all eliminated. The EA consolidated three separate contracts into one, giving IT procurement a single global view. Licence allocations can be balanced across countries internally rather than overpurchasing per region. Security tools are consolidated — no more double-paying for endpoint protection.
Azure commitment was right-sized with burst flexibility: if IoT projects scale up, overages still receive committed rates. If projects remain on-premises, the company isn't penalised. Dev/test workloads on MCA stay outside the EA until production-ready. The "pilot first, EA second" discipline ensures new technology adoption is always cost-justified.
A central monitoring system tracks licence usage across all merged entities. Semi-annual governance board meetings review Microsoft spending and identify optimisation opportunities. No region is at risk of being under-licensed while another has excess — the central team oversees the shared pool.
The company treats Microsoft licensing as a portfolio to be regularly evaluated, not a fixed expense. Any future additions are carefully vetted. Shelfware items were removed but with clauses to re-add at negotiated pricing — a no-cost option preserving flexibility without upfront waste.
"Thanks to Redress, our Microsoft agreements worldwide are finally consolidated and under control. We were able to remove the fluff — all those extra licences and services we weren't using — and end up with a deal that truly fits our business. Saving 22% on such a critical spend is huge for us, but just as important is the flexibility we gained. We can ramp up our cloud projects when we're ready, without fear of penalties or wasted spend."
— CIO, Netherlands Manufacturing Enterprise
Microsoft's EA pricing includes volume discount tiers (Level A, B, C, D) based on total licence count. When subsidiaries maintain separate agreements, each qualifies for a lower tier. Consolidating under a single EA pools all licences together, often pushing the organisation into a higher discount tier. In this case, combining HQ, European, and Asian subsidiary agreements moved the company from Level B to Level C — delivering a meaningful per-unit cost reduction across thousands of licences.
Azure burst flexibility is a negotiated term where consumption above the committed annual minimum still receives the same discounted rate as committed spend. Instead of paying list price for overages, the client benefits from their volume discount regardless. This is particularly valuable for organisations with uncertain cloud adoption timelines — like this manufacturer's IoT and AI pilots — because it removes the financial penalty for scaling up while protecting against waste if consumption is lower than expected.
Microsoft assigns EA discount tiers based on the total number of qualified devices or users in the organisation. Level A is the entry tier (500+ users), with increasing discounts at Level B (2,400+), Level C (6,000+), and Level D (15,000+). The specific thresholds and discount percentages are not publicly disclosed and can vary by region, but the principle is consistent: higher volume equals deeper discounts. Many organisations miss out because subsidiary agreements are not consolidated.
There is no universal answer — it depends on your security requirements and the capabilities of each tool. The key is to stop paying for both. In this case, the company evaluated both options and concluded that Microsoft's security suite (included with E5/E5 Security add-ons they were already paying for) met their needs, so they phased out the third-party tool for additional savings. If the third-party tool provided superior coverage, the alternative would have been to drop the Microsoft security add-ons and save on the EA side instead.
The Microsoft Customer Agreement (MCA) is a simplified purchasing agreement that allows pay-as-you-go or month-to-month Azure consumption outside the EA's rigid annual commitment. It is ideal for development/test environments, experimental workloads, and short-term projects that may not continue. Using MCA alongside the EA gives organisations flexibility to test cloud initiatives without committing long-term. Once a workload proves production-ready, it can be moved under the EA for committed-rate pricing.
When Redress negotiated the removal of unused products (like 450 Power Apps licences), they secured contractual clauses allowing the client to add those products back during the EA term at the same negotiated pricing — without any penalty or price increase. This creates a no-cost option: the company avoids paying for unused licences now, but preserves the ability to scale up if adoption increases. It effectively separates the commitment from the option, which is a significant win in software licensing negotiations.
Microsoft 365 F3 (formerly F1) is a frontline worker licence designed for employees who primarily use mobile devices or shared workstations. It includes email, Teams, basic Office web apps, and limited cloud storage — at a fraction of the cost of E3. Manufacturing environments often have thousands of factory floor supervisors, warehouse staff, and field technicians who need only these basic capabilities. Substituting F3 for E3 where appropriate can deliver savings of 60–70% per affected user.
Three practices are essential: centralised licence monitoring across all regions (to prevent ghost licences and regional overspending), semi-annual governance board reviews comparing usage against commitments, and a shared licence pool approach where surplus in one region can be reallocated to another instead of purchasing new. This manufacturer established all three, creating a continuous improvement cycle that sustains the 22% savings achieved at renewal rather than allowing waste to creep back in over the EA term.
Redress Compliance specialises in untangling multi-site agreements, eliminating shelfware, and negotiating enterprise-first terms. Let us help you unlock savings and flexibility in your Microsoft EA, regardless of the size of your footprint.