SAP user group welcomes value-based maintenance increase


SAP user group welcomes value-based maintenance increase

Cliff Saran

The SAP UK & Ireland User Group has welcomed SAP's decision to provide benchmarking and key performance indicators (KPIs) for its maintenance.

SAP and the SAP User Group Executive Network (Sugen), a global federation of 12 user groups, have a agreed a set of KPIs which govern the ERP company's maintenance contract.

Speaking to Computer Weekly, Alan Bowling, chairman of the SAP UK & Ireland User Group, said, "This is what we have been asking for. SAP's decision reflects the influence of user groups."

Significantly, the agreement between SAP and the user groups means that SAP will only be able to increase its software maintenance fees if it meets the KPIs agreed with the user groups. Bowling said, "We are linking real delivery of value to SAP's price increase."

Previously SAP wanted to increase its software maintenance fee from 17% to 22% during 2009. This price increase was later extended by five years. Bowlings said the agreement with the user group means the increase is now spread over seven years. Users will pay a maximum of 0.6% extra per year on maintenance, if SAP meets its KPIs.

SAP and the user group's represented by Sugen will conduct benchmarking to measure the improvements made to the maintenance.

The KPIs cover four business continuity, business process improvement, protection of investment and total cost of operations. Bowling said SAP will be required to reduce the number of emergency software changes it issues.

Bowling called on the software industry to follow SAP's lead by providing KPIs for value on maintenance contracts.

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