Case Study – Rise with SAP Advisory – U.S. Financial Services Firm Gains Flexibility and $5 Million Savings in RISE with SAP
Background
A U.S.-based financial services company (12,000 employees, approximately $4 billion in revenue) relied on SAP for its core finance and procurement systems. Facing SAP’s 2027 end-of-support deadline for ECC, they evaluated RISE with SAP to move to S/4HANA in the cloud.
The initial proposal combined S/4HANA, SAP Ariba, cloud infrastructure, and support into a single subscription. While cloud ERP promised agility, the bank was concerned about cost control and licensing complexity in this all-in-one deal.
Challenges
- High Costs & Hidden Fees: SAP’s initial RISE quote (~$ 15M/5 years) was inflated by opaque cloud fees. The bundle hid potential extra charges for growth (users, storage) and included unused services (“shelfware”) the bank didn’t need.
- Licensing Complexity (FUE): Converting thousands of users to Full-Use Equivalents (FUEs) was a confusing process. Without careful mapping, the bank risked over-counting casual users (e.g., read-only roles) and overpaying.
- All-in Contract Pressure: SAP pushed for an “all or nothing” RISE deal. The standard contract allowed no reduction in user counts mid-term (lock-in risk), only costly expansions. The client felt trapped by one-sided terms favoring SAP.
- Compliance Risk: An internal audit identified indirect usage (third-party systems accessing SAP data) that could result in licensing penalties. The bank worried that a quick move to RISE might paper over compliance issues instead of resolving them.
How Redress Compliance Helped
- License & Usage Audit: Redress conducted a full SAP license review, mapping users/roles to FUE categories. They identified approximately $2 million in shelfware (unused licenses) that could be eliminated or traded in. Optimizing the FUE count ensured light users (e.g., self-service only) didn’t inflate costs.
- Cost Modeling Alternatives: The team modeled scenarios to challenge SAP’s proposal. One model removed unneeded components (e.g., keeping SuccessFactors HR separate) to shrink the RISE scope. They compared the RISE deal against staying on ECC (with extended support) to show the bank’s walk-away alternative, pressuring SAP to sharpen its pencil.
- Negotiation & Benchmarking: Redress led a data-driven negotiation. Using industry benchmarks, they set target discounts and terms (e.g., 30% off and a cap on renewals) based on what similar firms have achieved. They made clear the bank would defer migration unless the RISE offer improved, creating leverage.
- Contractual Protections: The final agreement, shaped by Redress, included flexible terms rarely offered. SAP agreed to a right-size clause, allowing the bank to reduce FUE counts by up to 10% if business demand fell, addressing the lock-in concern. A 5% annual price cap was built into prevent cost spikes. To solve the compliance issue, Redress secured provisions for digital access that covered known third-party integrations, averting future indirect-use fees.
- Future Governance Plan: Redress delivered a roadmap for ongoing SAP license management. This plan outlined regular internal audits and usage monitoring so the client stays compliant and cost-efficient. It also detailed an exit strategy at the end of the term, ensuring the bank isn’t handcuffed by the contract and can negotiate from a position of strength in the future.
Outcome and Impact
Cost Savings:
The negotiated deal resulted in a reduction of approximately $10 million over five years, representing a 33% decrease from the original $ 30 million offer.
This approximately $5 million savings frees up the budget for innovation while delivering cloud benefits. The bank’s effective per-user (FUE) cost now aligns with market benchmarks for similar enterprises, rather than the inflated initial rate.
Risk Mitigation:
With Redress’s help, the company also avoided an estimated seven-figure exposure in potential audit penalties. All indirect access concerns were addressed through contract terms, providing the bank with peace of mind regarding compliance. Instead of entering RISE with latent audit risks, they now have a clean slate and documented usage rights.
Flexibility & Control:
The final RISE contract gives the client something rare – flexibility. They can adjust usage down if needed and enjoy predictable costs with capped increases. SAP’s “one-size-fits-all” approach was transformed into a tailored agreement on the client’s terms. The bank’s CIO now reports that their SAP cloud move is under control, with independent oversight (Redress) ensuring value and no unwelcome surprises.
Read about other Rise with SAP Case Studies.
Client Quote
“Redress Compliance acted as our ally in a complex negotiation where the odds felt stacked in SAP’s favor. Their independent expertise peeled back the layers of SAP’s proposal – showing us where we were over-paying and at risk. We ended up saving millions and, equally important, gained peace of mind that we won’t be ambushed by unforeseen costs or compliance issues. Redress truly put us back in control of our SAP destiny,” – CIO, U.S. Financial Services Firm (Anonymous)
Call-to-Action
Is your organization considering RISE with SAP or facing a high-stakes SAP renewal? Before signing anything, arm yourself with an independent perspective. Contact Redress Compliance for a free RISE with SAP risk & savings assessment. We’ll help you uncover hidden costs, negotiate favorable terms, and ensure you get the best deal – just as we did for this client.
Read about our Rise with SAP Contract and Licensing Advisory Services.
