German Automotive Manufacturer Avoids €6.4M in Indirect Access Penalties After SAP Audit Defense Engagement
(Industry: Automotive – Country: Germany – Employees: 45,000)
Challenge
This large automotive manufacturer faced an SAP license audit that uncovered potential indirect access usage. Several third-party systems, such as dealer portals and reporting tools, exchanged data with the SAP ERP without proper licensing.
SAP’s auditors claimed these indirect connections violated licensing terms and calculated a whopping €6.4 million in fees and back maintenance.
The company was caught off guard by the scale of this compliance gap. Past precedents showed that SAP was serious about enforcing such charges.
For example, in the high-profile Diageo case, SAP had even sought over £54 million for the indirect use of its software.
The challenge was clear: mitigate or eliminate the €6.4M penalty and ensure the company’s integration architecture wouldn’t continue to incur enormous licensing costs.
Solution
The manufacturer engaged an SAP audit defense and licensing specialist team to fight the audit findings.
The defense approach was both technical and contractual:
- Comprehensive Interface Review: The team catalogued all third-party applications and interfaces interacting with SAP. They mapped data flows for each to determine how external systems were creating, reading, or updating SAP data. This detailed analysis pinpointed exactly what usage counted as licensable indirect access.
- Contractual Analysis: License experts reviewed the company’s SAP contracts and usage rights. They looked for any existing clauses that could cover the identified indirect usage. In some cases, they found ambiguities or unused license entitlements that could be leveraged to legitimize certain access. Historical contracts were compared to SAP’s newer Digital Access model (which charges by documents processed instead of named users) to explore more favorable licensing options.
- Strategic Remediation: Working closely with IT, the company made targeted changes to reduce non-compliant usage. For example, some automated scripts were reconfigured to use a licensed SAP user account instead of direct database queries, and certain data exports were consolidated to minimize the number of documents created in SAP. These tweaks immediately curtailed the “indirect” usage footprint.
- Negotiation and License Optimization: Equipped with data evidence, the team entered negotiations with SAP. Rather than simply contesting the fees, they presented a plan to align with SAP’s updated licensing policies. The manufacturer opted into SAP’s Digital Access Adoption Program, which allowed indirect usage to be converted into a more predictable document-based license. SAP offered steep incentives for this transition, sometimes up to 90% discounts on the cost of digital access licenses, to encourage customers to regularize indirect use. The defense team negotiated a settlement where the company would purchase a modest number of Digital Access document licenses (at a heavily discounted rate) to cover all current and future indirect transactions. Crucially, this replaced the need to pay the punitive €6.4M back charges.
- Validation and Assurance: Once the agreement was in place, the specialists helped implement monitoring tools (including SAP’s measurement reports) to track digital document counts. This gave the manufacturer ongoing visibility into indirect usage. They also updated internal processes so that any new integration or third-party system would be evaluated for licensing impact before going live, preventing similar surprises.
Through this multifaceted strategy, technical fixes, clever use of contract terms, and negotiating a forward-looking license solution, the company systematically dismantled SAP’s €6.4M claim.
Outcome
Within a few months, the audit was resolved with no penalties paid. The engagement saved the company the entire €6.4 million that had been initially flagged, transforming a massive compliance exposure into a manageable licensing update.
By switching to SAP’s Digital Access model under favorable terms, the manufacturer avoided a budget crisis and instead incurred only minimal licensing costs that had been planned for and discounted.
The outcome provided immediate relief and several lasting benefits:
- Cost Avoidance: The most tangible result was the 100% avoidance of the €6.4M fee – funds that would have otherwise been lost. This budget preservation could be redirected to innovation and systems improvement instead of unplanned audit costs.
- License Compliance and Transparency: The company emerged with a clean bill of health on SAP licensing. All indirect usages are now properly licensed or designed, and the company fully understands how third-party systems interact with SAP. This dramatically lowers the risk of future surprise fees.
- Optimized Licensing Model: By embracing the digital access approach (document-based licensing), the organization modernized its SAP licensing to better fit its integrated landscape. The new model is more scalable and predictable for their high-volume data exchanges. The company is now a step ahead in aligning with SAP’s latest licensing practices, which is beneficial as SAP’s ecosystem evolves.
- Improved IT Governance: Internally, the audit defense engagement raised awareness across IT and compliance teams about indirect access rules. The company implemented stronger governance for any new software that connects to SAP, ensuring compliance is evaluated at the design stage. This proactive stance will protect them going forward.
- Transformation Enablement: Avoiding the huge penalty preserved the company’s momentum on strategic projects. There was no need for drastic budget cuts or project delays. Instead, the manufacturer could continue its digital transformation initiatives (such as a planned upgrade to S/4HANA) with confidence that licensing risks were under control. The resolutions put in place even set a foundation for that future upgrade, since the digital access licenses can carry over into an S/4HANA environment.
The German automotive firm turned a potential audit nightmare into a success story. It saved millions of euros and strengthened its SAP license position, ensuring that its complex web of systems can operate without compliance fears.
This case highlights how expert audit defense and a strategic approach to SAP’s indirect usage policies can protect an organization’s bottom line while enabling continued innovation.
