Independent advisory on SAP's native licence audit tools: USMM, LAW, LMBI, Solution Manager, NWA, and Digital Access monitoring. Practical guidance on using each tool effectively, avoiding compliance pitfalls, and optimising your licence position before SAP's official audit.
This guide is part of our SAP Licensing Knowledge Hub. See also: SAP Audit Survival Guide | SAP Digital Access Complete Guide | SAP Audit Defence Service.
SAP licence audits are high-stakes events that can result in significant unplanned costs. SAP expects customers to report actual usage and will charge for any under-licensing at list price, often with backdated maintenance fees. Over-licensing is equally wasteful, tying up budget in unused software. Proactive compliance management using SAP's native tools is essential.
| Tool | Purpose | When to Use |
|---|---|---|
| USMM (User and System Measurement Management) | SAP's primary on-premises measurement tool. Run in each SAP system to count named users by licence type and measure engine metrics (HR records, sales documents, database size). Administrators classify each user (Professional, Limited, Employee) and execute USMM to produce a detailed usage report | Every system, every measurement cycle. Foundation of all SAP audit data collection |
| LAW / SLAW (Licence Administration Workbench) | Consolidation tool for multi-system environments. Aggregates USMM results from multiple systems into one combined report. Deduplicates users appearing in multiple systems so each person is counted once enterprise-wide. LAW 2.0 (SLAW2) enhances the interface and supports newer metrics like HANA database counts | Any landscape with more than one SAP system. Essential to prevent double-counting |
| Solution Manager LMA (Licence Management Application) | Centrally coordinates licence measurements across all connected systems from one place. Can schedule and trigger USMM runs automatically and collect results | Large enterprises wanting to automate licence data collection and analyse usage trends over time |
| NWA (NetWeaver Administrator) | Licence monitoring for Java-based SAP environments and specific components. Provides insight into Java session counts, J2EE engine metrics, and other non-ABAP measurements that USMM does not cover | Any environment with Java-stack systems or engine-based licences |
| LMBI (Licence Management by Indicator) | Measures specific technical indicators: database size for HANA, number of records in industry solutions, throughput, configured objects. Goes beyond standard user counts to focus on metric-based licence entitlements | HANA deployments and any metric-based licences (e.g. checking HANA in-memory database size against licensed capacity) |
| Digital Access Monitoring | Counts documents (sales orders, invoices, purchase orders) created by non-SAP systems via external interfaces. SAP provides the Digital Access Evaluation Service and specific SAP notes/programs to scan logs and document tables | Any environment with third-party systems or external users interacting with SAP data via APIs or interfaces |
| SAP for Me Dashboard | Cloud-based dashboard providing consolidated view of licence consumption vs entitlements. For cloud products, SAP tracks usage automatically. For on-premises, customers upload USMM/LAW results to visualise alongside cloud subscriptions | Quick compliance snapshot comparing measured usage against contract figures in one online view |
| Practice | Guidance | Priority |
|---|---|---|
| Regular internal measurements | Schedule quarterly or at least semi-annually. Run USMM on all production systems to catch growth in user counts or engine utilisation early. Regular measurements identify trends before falling out of compliance | Critical |
| Proper user classification | Ensure each user ID is assigned the correct licence type. Misclassification is common: a limited user left as Professional inflates compliance gap. Unclassified users default to the highest (most expensive) category | Critical |
| Data consolidation and deduplication | When using LAW, take care to match identical users across systems. LAW auto-matches by username or email but review suggested matches. If accounts do not match exactly (jsmith vs john.smith), LAW treats them as separate. Use manual combination feature. Maintain consistent naming conventions | Critical |
| Iterate and validate | Treat measurement as iterative. Run USMM and LAW, review results, discover anomalies (test users counted, misclassified sets), clean up data, rerun. Verify final numbers make sense before submitting to SAP | High |
| Cover all systems and metrics | Include all SAP production systems: ERP, CRM, BW, SRM, every solution. Do not forget Java-stack systems (NWA) and metrics not automatically captured. Use LMBI for specialised licences such as HANA memory verification | High |
| Leverage new dashboards | Upload LAW results to SAP's Licence Utilisation portal. Review how it stacks against your contract. The portal highlights underutilised licences (optimisation opportunity) or overutilised ones (compliance risk) | High |
By routinely using SAP's licence audit tools proactively, organisations can self-correct compliance issues and negotiate licence adjustments on their own timeline rather than during the pressure of an official audit. The companies that treat licence compliance as a year-round discipline have far smoother audits than those that scramble when SAP's notification arrives.
| Model | How It Works | Best For |
|---|---|---|
| Named User Licensing (traditional) | Every individual or system that directly or indirectly uses SAP functionality requires a named user licence (Professional, Limited Professional, Employee Self-Service). Can be challenging to police for indirect use | Light third-party interactions, small numbers of external users, when per-user cost is lower than document volumes |
| Document-Based Licensing (Digital Access) | Instead of named users for every external touch, SAP licences the outcome: specific documents (sales orders, invoices, purchase orders) created by indirect activity. Nine core document types. SAP provides evaluation tools and programs to count documents. Customers purchase document packs | Extensive integrations, e-commerce feeding SAP, IoT, large partner networks where named-user licensing would be impractical |
A well-known SAP customer faced over 50 million pounds in fees due to unlicensed third-party usage. SAP audit teams ask for details on interfaces and use specialised tools to check for patterns of indirect use. Run SAP's digital access measurement tools to understand volumes. If counts are high, purchase Digital Access document packs, adjust architecture to minimise indirect calls, or exchange unused user licence value for Digital Access coverage. Monitor technical integration accounts. Incorporate digital access measurements into your overall compliance report before submitting to SAP.
| Pitfall | Description | Risk | Mitigation |
|---|---|---|---|
| Incomplete user cleanup | Old accounts for former employees or unused service accounts still appear in USMM results | High | Purge or decommission unused user IDs before measurement. Implement strict lifecycle management tied to HR offboarding |
| Misclassified users | Minimal-usage user left as Professional inflates gap. Heavy user classified low is audit risk | High | Double-check assignments with business owners. Update licence types when job scope changes |
| Inconsistent data across systems | Different IDs or slightly different names across environments. LAW misses duplicates | Medium | Maintain consistent enterprise identity through HR feed or centralised ID management |
| Overlooking engine and package metrics | Focusing on user counts while forgetting Payroll employee counts, CRM contracts, HANA database size | High | Know which engines are licensed. Check USMM output for each metric against contract entitlements |
| Ignoring indirect access | Assuming USMM/LAW captures all usage when third-party interactions need separate measurement | High | Inventory all integrations. Run Digital Access Evaluation tools. Determine licensing strategy per interface |
| Last-minute scramble | Treating audit as annual fire drill. Rushing measurements, classifications, issues in short timeframe | High | Year-round discipline. Use tools regularly, keep documentation, enter audit with confidence |
If you do not proactively classify every user ID in USMM before running measurements, the tool automatically assigns them Professional-level licences, dramatically inflating your compliance gap and potential true-up costs. This is one of the most common and costly mistakes in SAP licence audits.
| Recommendation | Guidance | Priority |
|---|---|---|
| Establish a licence compliance schedule | Schedule internal audits quarterly. Run USMM in all systems and review output. Regular checkpoints catch issues early | Critical |
| Maintain a single source of user data | Coordinate with HR or IT identity management so SAP user accounts stay in sync (one person = one SAP identity). Makes LAW deduplication straightforward | Critical |
| Train and empower licence administrators | Ensure Basis team or licence admins are well-trained in USMM, LAW (and LAW 2.0), and related tools. Designate a licence manager who owns this process year-round | Critical |
| Use what-if analysis | Before contract decisions, simulate changes. Run digital access estimation to see if document-based licensing is cost-effective. Classify all users as if a new licence type were introduced. Data-driven approach enables effective negotiations | High |
| Engage cross-functional stakeholders | Involve procurement, finance, and department heads in reviewing licence reports. They validate whether users need high-level licences or unused systems could be retired | High |
| Negotiate audit clauses and flexibility | Seek grace periods to remedy gaps before SAP can bill. Negotiate predetermined discount rates for additional licences. Use new model transitions (S/4HANA, cloud) as leverage for complimentary Digital Access or forgiven overages | High |
| Document everything | Maintain detailed records of measurements, assumptions, and all correspondence with SAP regarding licensing. Invaluable if audit outcome is disputed | High |
| Stay informed on licensing updates | SAP introduces new tools and changes definitions. Subscribe to support notifications. If SAP releases LAW 3.0 or new cloud measurement service, adopt early. Watch for policy changes | Medium |
| Step | Action | Detail |
|---|---|---|
| 1 | Inventory your systems | List all SAP systems (production and non-production) requiring measurement. Include ABAP and Java stacks. Note which tools (USMM, NWA) apply to each |
| 2 | Run and review USMM in each system | Update licence classifications for all users and remove obsolete accounts before running. Save measurement logs and results from each system |
| 3 | Consolidate with LAW | Import all USMM results into LAW/SLAW2 on central system. Match and merge duplicate users. Generate consolidated licence audit report. Review combined totals for each licence type and engine metric |
| 4 | Address exceptions | Investigate anomalies. Check engine metrics near or over entitlements. Ensure indirect usage documents are covered. Reclassify users, clean data, rerun if significant changes |
| 5 | Validate against entitlements | Compare final measured results to purchased entitlements. Document any shortfall or surplus. For shortfalls, decide whether to buy additional or negotiate alternatives. For surpluses, optimise by retiring unused or converting. Reconcile before submission |
Run licence measurement tools well before the official annual audit, ideally quarterly or at least a couple of times a year. Regular runs of USMM (and consolidation with LAW) enable you to monitor usage trends and address issues proactively. Treat internal measurements as health checks for SAP licence compliance throughout the year.
USMM is the system-specific measurement tool: you run it in each SAP system to get that system's user counts and usage figures. LAW (Licence Administration Workbench) is the consolidation tool: it combines all individual USMM results from multiple systems into a single comprehensive report. Think of USMM as measuring the pieces, and LAW as assembling the full puzzle. LAW also eliminates duplicate user counts across systems and provides enterprise-wide totals.
Indirect usage is not tallied by USMM. Use SAP's Digital Access measurement tools and technical analysis. SAP offers a Digital Access Evaluation report that scans your system for documents created indirectly. Review logs or use Solution Manager to track RFC and API calls into SAP. Combine these approaches to estimate indirect usage and ensure appropriate Digital Access or named user licences. Do this before an audit, as indirect use has been a source of significant compliance penalties.
Traditional tools (USMM, LAW) focus on on-premises systems. For cloud products (SuccessFactors, Concur, Ariba, S/4HANA Cloud), SAP monitors usage since they run the infrastructure. That data is available via the SAP for Me portal. In hybrid environments, use both: USMM/LAW for on-premises and the SAP portal for cloud subscriptions. Some customers export on-premises results to the portal for a single view.
Waiting until the last minute to run measurements leads to errors with no time to correct. Not classifying users properly means unclassified users default to the most expensive tier. Failing to remove inactive users or eliminate duplicates inflates counts. Overlooking indirect usage, assuming USMM captures everything when it needs separate assessment. Avoiding these comes down to preparation: run tools regularly, validate carefully, involve the right experts.
Whether preparing for an SAP audit, optimising your licence position, or understanding your Digital Access exposure, our independent SAP advisors help enterprises measure accurately, negotiate effectively, and avoid costly compliance surprises. 100% vendor-independent. Fixed-fee engagement.
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