Mastering SAP Cloud Contract Negotiation: RISE with SAP Strategies for CIOs and Procurement

Mastering SAP Cloud Contract Negotiation: RISE with SAP Strategies for CIOs and Procurement

Mastering RISE with SAP negotiations is critical for CIOs and enterprise procurement leaders looking to optimize costs and avoid pitfalls.

RISE with SAP (SAP’s bundled S/4HANA Cloud offering) can deliver digital transformation as a service, but only if you secure favorable terms.

Below are the Top 15 Things to Do to negotiate a winning RISE with an SAP cloud contract. Each item includes actionable steps and strategic insights, presented in a Gartner-style advisory tone for maximum clarity and impact.

1. Align Stakeholders & Establish Governance Early

From the start, bring together a cross-functional negotiation taskforce – IT, procurement, finance, legal, and key business stakeholders. This ensures all perspectives (technical requirements, budget constraints, legal risks) are considered. Set clear governance: assign roles (e.g., who leads talks, who signs off on terms) and decision criteria.

Practical impact: A united internal front prevents SAP from exploiting internal misalignment. It also streamlines decision-making so you can respond to SAP’s proposals quickly and with consensus.

Tip: Assign an executive sponsor (e.g., CIO or CFO) to back the negotiation team and establish an internal process to monitor SAP usage and compliance throughout the contract. This governance continues post-signature, ensuring you manage licenses and avoid surprises.

2. RISE with SAP Bundle vs. Traditional Licensing

Educate your team on what RISE includes and what it doesn’t. RISE with SAP is a one-stop subscription bundle that includes software, infrastructure (hyperscaler cloud), and basic support in one contract. This contrasts with traditional on-premises SAP deals (where you buy perpetual licenses and infrastructure separately).

Make sure everyone grasps the key differences before negotiating terms:

Understanding this bundle is vital so you can negotiate the right scope. For example, SAP manages the cloud hosting under RISE, but implementation, customizations, and functional support remain your responsibility (or your partner’s).

Practical impact: By knowing what RISE does and doesn’t cover, you can budget correctly and push SAP to clarify any gray areas. If an item isn’t explicitly included (e.g., disaster recovery environment, additional sandbox systems), address it in the contract or plan for it separately.

This foundational knowledge prevents costly assumptions – you don’t want to sign off thinking SAP will handle something, only to find out later it’s on you.

3. Craft a Legacy License Transition Plan

If you’re moving from on-premise ECC or other SAP legacy systems, have a clear strategy for transitioning those licenses to the cloud.

Key actions include:

• Inventory and evaluate current licenses: Determine what SAP licenses you own (and their ongoing maintenance costs). Identify which ones will be replaced by RISE’s S/4HANA cloud and which legacy components might remain.
• Negotiate conversion credits: SAP often allows the conversion of existing licenses/maintenance into RISE subscription value. Ensure any unused maintenance fees or net license value are credited toward your RISE subscription. This might be via SAP’s conversion programs or a custom agreement—don’t leave your sunk costs on the table.
• Enable dual-use (transition) period: In many migrations, you’ll run old and new systems in parallel for some time. Negotiate a “dual-use” clause that lets you operate your legacy ECC system alongside S/4HANA in RISE during go-live and transition without double-paying. For example, you might continue using ECC for a few months while S/4HANA is phased in – SAP should agree not to charge full price for both simultaneously.
• Plan the cutover and decommission: Decide when to terminate old maintenance agreements. Coordinate the end of ECC maintenance with the start of RISE to avoid overlap costs. Ensure SAP’s contract spells out how and when the old contract will be retired.

Practical impact: A well-crafted transition plan protects the value of your existing investments and avoids service gaps. You won’t pay for two systems at once or lose support during migration. Moreover, by obtaining credits for your legacy licenses, you lower the effective cost of RISE.

Be mindful that moving to RISE means giving up perpetual license rights for those converted products – plan for that loss of flexibility. (For instance, if you leave RISE later, you may need to re-purchase licenses to run SAP on-prem again unless you negotiate safeguards now – see the Exit Strategy item below.)

4. Address Indirect Access and Compliance Upfront

Indirect access (when non-SAP applications or users indirectly use SAP data/functionality) has long been a licensing thorn.

Don’t ignore it in a RISE deal. While RISE uses a simplified user metric (FUEs), it does not automatically cover all indirect usage – SAP’s “Digital Access” model (document-based licensing) still applies for certain scenarios.

To avoid future audit surprises:

• Map out interfaces and integrations: Identify every system (e.g., e-commerce platform, CRM, data warehouse) that reads from or writes to your SAP system. Engage stakeholders from those teams to gauge usage volumes.
• Negotiate digital access provisions: Discuss with SAP how these indirect uses will be licensed under RISE. Often, the solution is to include a Digital Access Document Pack in your RISE contract, covering a certain number of documents (sales orders, invoices, etc.) generated by external systems. If you expect high volumes of indirect documents, secure a sufficient allotment now (at a discounted rate) rather than face a compliance bill later.
• Clarify in the contract: Ensure the contract language clearly states what indirect usage is permitted or included. For example, if employees or partners access SAP through a third-party app, is that counted against your user FUEs or digital documents? Define the metric and entitlements to avoid ambiguity. Also, include audit terms (e.g. SAP must notify and work with you if measuring digital documents) so you’re not blindsided.

Practical impact: Addressing indirect access during negotiations can save you from potential hefty penalties or true-up costs. It also lets you budget for total SAP usage (both direct and indirect) in one deal.

By positioning the indirect access discussion early, you show SAP you’re a savvy customer who expects a compliant and complete solution, prompting them to be more transparent and reasonable.

The result is peace of mind—you won’t be nervously waiting for an SAP audit that claims you owe extra for that new e-commerce interface or IoT system integration.

5. Benchmark Costs and Set Negotiation Targets

Before you even sit at the table with SAP, do your homework on pricing benchmarks and define your objectives. SAP’s initial quotes for RISE can be opaque or inflated – it’s up to you to challenge them.

Actions to take:

• Gather internal data: Analyze your current SAP spend (licenses, maintenance, infrastructure) to understand your baseline. Know how many users (or FUEs) you truly need, and identify any shelfware or excess so you only negotiate for what you require.
• Leverage market benchmarks: Seek insight into what similar organizations pay for RISE or comparable SAP cloud deals. Independent licensing advisors and peer networks can provide anonymized benchmarks (e.g., typical percentage discounts off SAP’s price list and common concessions like renewal caps). For instance, if peers in your industry achieved a 40% discount, that sets the bar for your deal.
• Set a target and walk-away point: Establish your desired outcome (e.g., “We need at least 30% off list and a cap of 5% on renewals”) and your thresholds (e.g., “If SAP can’t meet X price, we’ll reconsider delaying the project or using an alternative”). By having these targets, you give your team a clear goal and avoid being swayed by SAP’s framing of the deal.

Practical impact: Coming armed with data flips the power dynamic. Instead of reacting to SAP’s numbers, you lead the conversation with evidence. For example, you can confidently say, “Our analysis shows a fair price is $Y – here’s why.” If you know the going market rates, SAP sales teams are less likely to pull the wool over your eyes.

Setting firm targets also prevents “scope creep” or soft concessions; you’re less likely to accept a subpar deal in the heat of negotiation because you’ve defined success (and failure) criteria in advance. In short, knowledge is leverage – use it to demand a competitive deal aligned with market standards and your budget reality.

6. Leverage SAP’s Fiscal Calendar for Timing Advantage

Timing can be a secret weapon in your negotiation. SAP, like many vendors, has quarterly and annual sales targets. Aligning your negotiation to coincide with these pressure points can yield better terms:

• Plan for quarter-end or year-end closings: Schedule final negotiations toward SAP’s Q4 or end-of-quarter push whenever possible. SAP’s fiscal year is the calendar year, so a deal closing in Q4 (Oct-Dec) is especially powerful. As deadlines loom, sales reps are eager to hit quotas and secure their commissions. This is when they’re most flexible with discounts and freebies. Example: Some CIOs report securing an extra 10-15% discount in the final week of December simply because SAP needed that deal booked in the year’s results.
• Create (realistic) urgency: Let SAP know that budget approvals or project start dates align with that quarter-end, implying the deal can be signed by then if terms are agreeable. This puts the onus on SAP to come back with their best offer by the deadline. It’s a subtle way to say, “We’re prepared to move now, but only for the right deal.”
• Be willing to pause: While leveraging SAP’s timeline helps, never let their deadline force you into a bad contract. If you’re at Q4 end and SAP still hasn’t met your key requirements, be ready to walk away and continue next quarter. Ironically, showing that you won’t be rushed often results in a better offer later. SAP might return in Q1 with even more concessions, not wanting to lose the sale entirely.

Practical impact: Using timing strategically can save significant money without any change in your requirements. You’re not conceding anything – you’re simply capitalizing on SAP’s internal motivators. The outcome could be a notably lower subscription price or more favorable terms than you’d ever get mid-quarter.

Remember the flip side: SAP may attempt to use the same timing pressure on you (“This offer expires this quarter!”). Stay disciplined; use the calendar as leverage, but don’t let it become leverage against you.

When executed well, aligning to SAP’s fiscal calendar is a low-cost, high-impact negotiation tactic that can tip the scales in your favor.

7. Anticipate SAP Sales Tactics and Stay Firm

SAP’s sales teams are skilled negotiators in their own right, and they have a playbook of tactics to close deals on their terms. Common strategies include spreading FUD (Fear, Uncertainty, Doubt) about staying on legacy systems, pushing “bundle” deals, or hinting at audits and penalties.

Be prepared to counter these moves confidently:

• End-of-support pressure: You’ll hear reminders that SAP ECC support ends in 2027, implying you must move to S/4HANA (and RISE) soon or risk higher costs later. While this deadline is real, don’t let it dictate a rushed purchase. Develop your roadmap – maybe you need more time to execute a successful migration. If SAP says “buy now or else,” focus on factual business needs: Will an earlier purchase benefit us, or are we being sold urgently? Stay cool and, if needed, acknowledge the 2027 date, but make clear you won’t invest until the business case is sound.
• Audit and compliance threats: It’s not unheard of for a sales rep to imply that delaying a deal could result in a license audit or that “compliance issues” might surface. Recognize this tactic and diffuse it. Ensure your house is in order (do an internal license audit so you know your compliance position), and respond by saying you are confident in your license compliance. This takes the sting out of the threat. In essence, call their bluff – don’t let the fear of an audit push you into a hasty agreement.
• Bundling extras you don’t need: SAP may propose a larger bundle – e.g., additional SAP modules, extra cloud services, or higher user counts – touting a “great discount” if you take it all now. This can tempt you to over-buy. Guard against it by referring to your requirements (from step 5). If a component isn’t needed for the next couple of years, it’s likely better to leave it out. You can always add later (ideally at a similar discount). Politely but firmly unbundle the deal: “We appreciate the offer, but we’ll stick to the modules we plan to use. Let’s focus on getting those at the right price.” By declining shelfware, you maintain leverage and budget for truly important things.

Practical impact: By anticipating these sales tactics, you avoid common negotiation traps. You’ll make decisions based on your strategic needs, not sales rhetoric.

Importantly, you set a tone that you control the negotiation timeline and scope. SAP reps will realize standard pressure techniques aren’t moving you and will engage more constructively.

This can lead to a more rational discussion centered on value and terms rather than theatrics. In the end, staying firm against pressure ensures that you only sign a RISE contract that you fully understand and truly want—one that meets your goals without unnecessary baggage or hidden anxiety.

8. Demand Transparency in Pricing Breakdown

A RISE with SAP proposal often comes as one big number – an annual subscription fee covering everything.

As a buyer, you must pull back the curtain on that pricing. Insist on a detailed breakdown of what you’re paying for:

• Itemize software vs. infrastructure vs. services: Ask SAP to separate the costs of the S/4HANA software subscription, the cloud infrastructure (IaaS) costs, and any SAP-provided services (like Cloud Operations, support, etc.). This might be delivered as an internal SAP Bill of Materials (BoM) or an informal breakdown, but push to get it.
• Benchmark each component: With a breakdown, you can evaluate each part. For example, if SAP uses Azure or AWS as the underlying infrastructure, what portion of your fee is effective for cloud hosting? Does that markup seem reasonable compared to market cloud prices? If not, you have room to negotiate (“We have our cloud agreement with better rates; how can we align the RISE price to that?”). Likewise, see what they’re charging for S/4HANA itself – does the per-user cost align with known S/4HANA subscription prices? Transparency here helps you identify inflated charges.
• Expose and eliminate “pink elephant” costs: Sometimes SAP might bundle in something you don’t need (e.g., an extra component or an assumption of a certain user count). You might spot a line item that looks off by getting a breakdown. For instance, if the infrastructure cost seems high for your size, SAP may have allocated excessive resources. Question it: “We don’t anticipate needing that much storage or computing – can we scale this down and reduce the fee accordingly?” This ensures you’re not overpaying for oversized capacity or unwanted add-ons.

Practical impact: Pricing transparency is your ally for a fair deal. It enables data-driven negotiations – you can target the expensive pieces rather than haggling blindly on the total. Often, this results in significant savings. Perhaps you discover an ability to cut 10% by rightsizing the infrastructure component, or you realize you can drop a service you have covered elsewhere.

Additionally, showing SAP that you expect granular clarity positions you as a sophisticated customer; they’re likely to respond by being more forthcoming and reasonable.

Ultimately, a transparent breakdown gives you confidence that every dollar in your RISE contract is justified and optimally allocated, which is exactly what a CIO/CPO needs to assure their board and stakeholders.

9. Negotiate Aggressively for Discounts and Value-Adds

With your cost breakdown and benchmarks, drive hard for the best financial terms. SAP expects negotiation—its initial quote is rarely its best offer.

Here’s how to maximize value:

• Push for double-digit discounts: Don’t hesitate to counter with a significantly lower price than quoted. Depending on your leverage, it’s common to aim for 30-50% off SAP’s list price for a package deal. After tough negotiations, many enterprises have achieved 15- 30 %+ reductions on RISE deals. Use your leverage points: migrating off ECC (SAP wants that), considering competitors, delaying (your Plan B), or being a referenceable customer. All of these can justify a better rate. Make SAP justify why their price shouldn’t come down – that flips the script.
• Ask for incentives: Look for sweeteners that add value besides pure discounts. For example, request extra SAP Business Technology Platform (BTP) credits beyond the standard allotment (for integrations or extensions) or free training and consulting hours to support your implementation. SAP might also offer financing perks like deferred payment schedules (e.g., “Pay nothing for the first 6 months of the subscription”) – these can help your cash flow. Ensure these extras are written into the contract. They can sometimes be easier for SAP to grant than a larger discount, but still save you money.
• Total Cost focus: When negotiating price, consider the multi-year TCO. A slightly higher discount that results in a much lower renewal price trajectory is more valuable than a one-time concession. For example, you might accept a 40% discount instead of 45% if SAP agrees to fix that price for 5 years. Always evaluate the deal holistically. Use a simple table or model to calculate your spending over the full term under different scenarios – share this with SAP to illustrate why you need the terms you’re asking. (They’ll see you’re planning long-term, encouraging them to partner with you on TCO, not just year-1 price.)

Practical impact: By negotiating assertively, you minimize unnecessary spending and maximize value from the start. Every percentage point of discount on a large SAP contract can equate to millions saved over the term.

Those savings could be redirected to other strategic projects or used to ensure the success of your SAP initiative (e.g., funding change management or integration work).

Moreover, extracting value-adds like BTP credits or services can accelerate your ROI on the RISE investment – you’re essentially getting more for the same spend. Remember, SAP’s sales team is measured on revenue but also adoption – they can include extras that don’t hit their revenue line directly.

Use that to your advantage. The end goal is a commercially optimized deal where you feel you’ve squeezed out every bit of waste and obtained a package that propels your program forward cost-effectively.

10. Secure Renewal Protections and Price Caps

One of the most critical areas of an SAP cloud contract is what happens at renewal. You don’t want to enjoy three years of a good deal only to face a gigantic price hike or restrictive terms when it’s time to renew.

From the outset, bake in protections:

• Cap the price increases: Negotiate a ceiling on annual price uplifts. For instance, agree that upon renewal, SAP cannot increase the subscription fees by more than X% (say 3-5%) per year or tie it to an inflation index (with a hard cap). If you can, secure a price lock for the first renewal term – meaning if you signed a 3-year deal, the price for the next 3-year term remains the same (or has a minimal predefined bump). This is hugely valuable in avoiding “sticker shock” later.
• Carry forward discounts: Ensure that any discounts you negotiated off the list price carry into future expansions or renewals. The contract should state that additional users or upgrades will at least receive the same percentage discount as the initial purchase. Without this, you might find that if you need 100 more users in year 2, SAP tries to charge them at full price. Likewise, at renewal, you shouldn’t lose the original discount advantage. Lock it in writing.
• Flexible renewal options: Try to include terms that give you renewal options. For example, the right to reduce users or swap out modules at renewal without penalty (maybe you overestimated and want to scale down or drop a component and add another). Also, negotiate a renewal notification period – SAP should inform you of the renewal pricing well in advance (e.g., 6-12 months before renewal) so you have time to plan or renegotiate. This prevents last-minute surprises and allows you to consider alternatives if SAP returns with an unsatisfactory renewal offer.

Practical impact: With strong renewal clauses, you preserve the value of your deal over the long run. You won’t be hostage to an unbounded price increase when deeply invested in the SAP platform a few years later. It also sends SAP a message that you expect a partnership, not a one-off transaction – they’ll be less likely to attempt an exploitative renewal if the contract guards against it.

Cost predictability is huge for CIOs managing multi-year budgets; these provisions give you that predictability. In essence, you’re negotiating the initial contract and the entire lifecycle of your engagement with SAP. Many companies that skip this step regret it later when renewal time comes – by handling it now, you ensure your “RISE with SAP” doesn’t come with an unwelcome “rise” in future costs.

11. Build Flexibility for Changing Needs

Enterprises are dynamic – mergers happen, business lines change, and user counts fluctuate. Your SAP contract should not be a static straightjacket.

Build in flexibility so the agreement can adapt to you:

• Scalability (up and down): While SAP will gladly let you add users or capacity, they often resist reductions. Push for a clause that allows a one-time reduction or adjustment if needed. For example, a mid-term rebalancing: at the 24-month mark of a 5-year deal, you can decrease the FUE count by up to 10% or swap one component for another if usage patterns change. At a minimum, secure the right to “true-down” at renewal – meaning you can reduce users or remove components at the end of the term without penalty or paying out the remainder. If your business contracts or divests a division, you’re not stuck overpaying for unused licenses.
• Future-proof swapping: Negotiate flexibility to substitute technologies if needed. Maybe you sign up for SAP Analytics Cloud as part of RISE, but in two years, a new SAP product or an alternative is more fitting – try to get a swap rights clause. For example, “Customer may exchange unused portions of Service A for Service B of equivalent value with SAP’s agreement.” Even if SAP doesn’t fully agree, raising it often leads them to offer more lenient terms for adding new products later.
• Consistent pricing for growth: Ensure any additional licenses or resources you add later come at the same rate as initially negotiated. This was touched on in renewal, but it applies during the term, too. You don’t want to renegotiate from scratch at potentially higher prices if you need to ramp up users due to an acquisition or faster rollout. Lock in unit prices now for certain growth tiers (e.g., “If we exceed X FUEs, those will be priced at $Y per FUE, consistent with initial discounts”). SAP often includes a growth allowance in RISE deals – ensure it’s favorable to you.
• Governance for usage: Internally, maintain flexibility by monitoring your usage. For instance, track your user count against contracted FUEs regularly. If you’re trending below, you might negotiate to adjust down at renewal; if above, you can plan the budget or ask SAP for an interim increase at the predetermined rate. This internal transparency ensures you maximize what you’re paying for and can proactively address changes with SAP.

Practical impact: Flexibility clauses prevent paying for a contract that no longer fits your business reality. You gain the agility to respond to change, whether scaling up for growth or trimming down to cut costs. From a financial perspective, this can save millions if your needs decrease and prevent operational headaches if you need to reallocate licenses.

It also encourages SAP to work with you through changes instead of holding you back from an outdated commitment. A more flexible contract is a more resilient contract, ensuring the RISE agreement continues to deliver value even as your organization evolves.

In sum, you’re negotiating insurance against uncertainty – a smart move for any CIO in today’s fast-changing environment.

12. Strengthen SLAs and Performance Remedies

Service Level Agreements (SLAs) in SAP’s standard cloud contract might not align with your business criticality. As CIO, you need to ensure the RISE service will support your uptime and performance needs – and that there are consequences if it doesn’t:

• Review default SLAs: SAP RISE typically comes with an uptime SLA (~99.7% uptime for production systems) and supports response time commitments. Determine if those meet your requirements. If you have a global 24×7 operation, is the support 24×7? If you need higher uptime (maybe 99.9% or above), raise it. Negotiate higher SLA targets or tailor them for key systems if necessary. Every 0.1% of uptime can be significant (0.1% of a year is ~8 hours of downtime).
• Add meaningful remedies: An SLA is only as good as the remedy when missed. SAP’s standard remedy might be a small service credit or extension if uptime falls short. You may negotiate stronger remedies: for instance, service credits that scale with downtime impact (e.g., more credit for longer outages), or even the right to terminate the contract without penalty if SAP consistently fails SLA over a period. While SAP may not readily agree to termination for SLA breaches, pushing for it can at least improve the credits offered. The goal is to make SAP share the pain if their service falters.
• Include performance KPIs: Beyond raw uptime, consider other performance metrics – e.g. critical incident response times (how fast SAP must react to P1 issues), disaster recovery RTO/RPO if that’s included, and update/upgrade scheduling (will maintenance windows be agreeable to you?). Get commitments in the contract about these. For example, “Critical Priority incidents will have a response from SAP within 1 hour and resolution or workaround within 4 hours” – and link that to credits if breached.
• Clarify support scope: Define what “standard support” includes under RISE. Do you have a dedicated contact? What about support for custom code or interfaces? This is likely your responsibility, but ensure roles are clear. Some customers opt for SAP MaxAttention or Premium Engagements (for a fee)—if you need that level, negotiate it either into the price or ensure integration with RISE support.

Practical impact: You protect your business operations by firming up SLAs and remedies. If SAP knows it will owe you credits or risk losing your business for poor service, it has a strong incentive to meet or exceed expectations.

This translates to higher reliability for your end-users and less firefighting for your IT team. In the unfortunate event of a major outage, the negotiated remedies at least compensate a portion of the losses or provide an exit path if SAP truly cannot deliver. Essentially, you’re ensuring that SAP “has skin in the game” performance-wise.

This proactive stance can be the difference between an acceptable hiccup and a disaster, and it will be something your stakeholders in the business will thank you for (likely, they won’t notice anything because things will just run smoothly, which is the point!).

Remember, when critical systems are on the line, don’t accept boilerplate SLAs – tailor them to what your enterprise needs to sleep at night.

13. Clarify Scope and Responsibilities in the Contract

Ambiguity is the enemy of a good contract. During negotiation, pinpoint exactly what is included in your RISE with the SAP agreement and who does what.

This avoids “I thought that was included!” scenarios later:

• Document the scope of services: List all the SAP products and services you expect as part of RISE. This means every software component (S/4HANA modules, any included SAP Cloud services like Ariba, SuccessFactors integration, etc.), the number of environments (e.g. production, test, development systems – are dev/test included or extra cost?), and any additional tools (perhaps the RISE bundle includes SAP Business Network starter pack, BTP credits, etc. – ensure they’re enumerated). If something is not explicitly in the contract, assume it’s not included. For example, disaster recovery: is a warm standby system part of the standard RISE service or do you need to pay extra? Don’t leave it vague; get it included or know the price. Clearing up the scope now prevents surprise charges like “Oh, you wanted a QA system? That’s extra.”
• Define responsibility splits: RISE is SAP-managed infrastructure and basis support, but your team (or your implementation partner) still has responsibilities. Create a responsibility matrix if needed and attach it to the contract or statement of work. Key areas to clarify: who handles application-level support (user administration, job monitoring, minor config fixes)? Who is responsible for applying SAP notes or patches – SAP for technical ones, but what about notes for business processes? Testing responsibilities during upgrades? Security roles and compliance? For example, you might agree SAP handles all system upgrades and patches, but your team will do integration testing and inform SAP of optimal timing. Make sure data backup and restore duties are clear, too. Why this matters: if an issue arises (say a performance problem), you don’t want finger-pointing between SAP and your team – the contract should clarify how issues are triaged and who fixes what.
• Data ownership and IP: Insist on clauses that state that your data is always your property. You should have the right to retrieve a full export of your data (in a usable format) at any time and at the end of the contract. If you build any custom extensions (say on SAP BTP or within S/4), clarify that the intellectual property for those customizations is yours, so you can take them if you move off. Also, if you integrate non-SAP systems, ensure nothing in the contract limits those connections beyond standard license compliance (which you addressed in Indirect Access). Essentially, no lock-in through data or custom work – you retain control.

Practical impact: You avoid hidden costs and operational gray areas by nailing down scope and roles in black and white. Everything you’re paying for is enumerated, so SAP can’t later say, “We assumed you didn’t need that.” Your teams and SAP’s teams will work more smoothly together because responsibilities were agreed upon upfront, leading to fewer dropped balls and service gaps.

For procurement and legal, this clarity is gold: it reduces the risk of disputes or needing contract amendments mid-stream. In an ERP project, countless tasks need coordination; a well-defined contract is the blueprint for that coordination.

The result is a smoother project execution and a steady-state operation where everyone knows their job. No surprises, no extra purchase orders for things you thought were in scope – just a clean, well-understood service. This is how you turn a dense contract into a practical, working partnership document.

14. Plan an Exit Strategy and Data Safeguards

While you are entering this RISE with SAP relationship expecting success, prudent leaders always plan for an exit. Conditions can change in a few years—you might consider switching to a different model, or worse, things might not work out with SAP as hoped.

Negotiating an exit strategy doesn’t mean you’re pessimistic; it means you’re thorough:

• Assure data retrieval: Negotiate the process and support you’ll get if you decide not to renew RISE. The contract should guarantee that SAP will provide a full data export of your S/4HANA database and any other data (configurations, custom code, logs) upon exit in a format that can be used to restore on another system if needed. Also, confirm how long your data will be retained after the contract ends (you’ll want enough time to transition, e.g., 60-90 days of read-access to the environment after termination).
• Transition assistance: If possible, include a clause for transition services. For instance, SAP (or a third party through SAP) could assist in migrating your data out to an on-prem environment or another cloud if you leave. At the very least, ensure you won’t be stranded. Perhaps negotiate a right to extend the contract by a few months at the end under the same terms if you need more time to transition (this can be very helpful to avoid a hard cut-off).
• License fallback options: One of the trickiest parts of exiting RISE is that you give up your perpetual licenses. Consider negotiating an option to purchase a perpetual S/4HANA license at the end of the term (or upon early termination) for a pre-agreed price. Even if SAP says no, discuss what re-licensing would involve. Having this understanding is valuable. In some cases, clients have arranged for a “reversion right” – a promise that they can revert to on-prem licenses for S/4HANA with a credit for a portion of subscription fees paid. It might not be standard, but it’s worth asking if you’re a sizable customer. At a minimum, be aware that if you needed to stay on SAP but leave RISE, you’d have to buy licenses anew – plan financially for that scenario.
• No penalties for non-renewal: Ensure the contract has no automatic renewal clauses that lock you in or notice periods that, if missed, extend the contract. You want the ability to walk away at the end of the term without punitive fees (aside from maybe the inconvenience of migrating). Early termination for convenience is unlikely (and would come with heavy penalties, if at all), so focus on end-of-term exit conditions.

Practical impact: A solid exit strategy eliminates vendor lock-in anxiety. It gives you leverage even during the contract – SAP knows you have a clear plan B, which can motivate them to keep you happy (and perhaps be reasonable in future negotiations). Internally, your board or stakeholders will appreciate knowing you’re not writing a blank check to SAP indefinitely; you have control over your destiny.

If market conditions or company strategy change, you can pivot without catastrophic disruption. Think of it as an insurance policy: you hope not to use it, but it’s there. Interestingly, having an exit plan often means you’ll never need to use it because you’ll have negotiated a deal that continues to work well or can be adjusted on your terms.

Nonetheless, documenting how you’d disentangle now will save you scrambling years later. It’s much easier to negotiate exit terms when SAP is trying to win your business than when you’re trying to leave. So secure your parachute upfront, even as you optimistically embark on your cloud journey with SAP.

15. Engage Independent Licensing Experts for Support

Negotiating with SAP is a high-stakes endeavor, and bringing in reinforcements is perfectly fine. Consider enlisting the help of independent SAP licensing and contract experts (such as Redress Compliance or similar specialists) to bolster your team’s capabilities:

• Leverage their experience: Independent advisors have typically seen many SAP deals. They know SAP’s tactics, typical discount ranges, and where contracts tend to have hidden risks. They can quickly flag “Gotchas” in SAP’s proposal that you might overlook if you’ve only ever negotiated SAP deals once or twice in your career. For instance, an expert might spot that a specific contract clause on indirect usage is missing or that the SLA language could be strengthened, insights gleaned from other clients’ experiences.
• Benchmark and strategy input: Firms like Redress Compliance maintain anonymized data on recent SAP negotiations. They can tell you, “Company X of similar size got a 50% discount and a 5-year price lock – aim for that.” This information is incredibly valuable when SAP insists your ask is too high – you’ll know it’s been done before. These experts can also help shape your negotiation strategy, role-play SAP’s likely responses, and coach your team on messaging. It’s like having a former SAP insider (many consultants are ex-SAP or ex-licensing auditors) whispering in your ear.
• Licensing optimization: Independent licensing consultants can analyze your SAP usage and suggest optimizing licenses before you negotiate. Perhaps they find that you can reclassify some heavy users to lighter roles, reducing the FUE count needed, or identify unused licenses to drop – this can directly reduce the quote you ask SAP for. They ensure you’re not buying more than you need and that you fully understand the implications of moving licenses to RISE. They can also validate SAP’s conversion calculations if you’re trading in licenses.
• Objective ally: Most importantly, these advisors are on your side and are not paid by SAP. They provide a reality check and keep SAP honest. During tough negotiations, they can interface with SAP alongside you or behind the scenes, bringing up points you might feel less comfortable pushing on. Their presence signals to SAP that you’re serious about getting the best terms and won’t be easily misled.

Practical impact: Engaging an independent expert can tip the balance of power in the negotiation. It’s like having a seasoned contract negotiator and analyst on your team, often resulting in materially better terms and cost savings that far exceed the consulting fee. They also save your internal team time by doing heavy lifting on analysis and providing negotiation scripts or counter-proposals.

This external perspective is invaluable for CIOs and procurement leads to ensure you haven’t missed anything crucial. Think of them as a specialized extension of your team that deals with SAP contracts daily. In a complex, one-shot negotiation like a RISE deal, their input can be the difference between a good deal and a great deal.

Bonus: They can continue to advise throughout the life of the contract, helping interpret terms or strategize for renewal when it comes. In summary, don’t go it alone if you don’t have to—use expert help to level the playing field with SAP’s seasoned sales and legal teams and come away with a contract that stands the test of time.

Conclusion: Market Trends and Emerging Insights

As you navigate RISE with SAP negotiations, keep an eye on the broader market context and emerging trends that can influence your strategy:

• Surge in RISE Adoption (and Caution): With the 2027 ECC support deadline approaching, many enterprises are now evaluating or undertaking RISE deals. SAP is highly motivated to convert its customer base to the cloud model, often using incentives and aggressive sales efforts. This means that now (2023–2025), it is a buyer’s market in some respects – SAP is willing to make concessions to win your commitment. However, as more companies sign on, SAP could become less generous with late adopters. Knowing where you stand (are you one of the early majority or a holdout?) can inform how hard you push. Early movers have reported substantial incentives, whereas those who wait until the last minute may find SAP, assuming they have no choice.
• Cloud Cost Scrutiny and Optimization: There’s a growing focus on controlling cloud spend across the industry. CIOs have learned that while the cloud can offer agility, it doesn’t automatically save money without careful management. This is affecting SAP deals, too – customers are negotiating more aggressively on SaaS contracts and demanding transparency (as we emphasized). SAP has been more open to flexible constructs (e.g., step-up payments, shorter initial terms, or commit-as-you-go models) for strategic clients. Emerging insight: Don’t be afraid to challenge the notion of a monolithic 5-year commitment; if your usage is uncertain, more elastic arrangements are becoming more common in enterprise negotiations. SAP would prefer to lock you in, but they also want happy referenceable clients – use that to explore innovative contract structures that could suit your needs better than the “one-size-fits-all” approach.
• Innovations Tied to Cloud: SAP’s roadmap is increasingly cloud-first. New innovations – think AI/ML features, advanced analytics, industry cloud extensions, and integration services – are being rolled out to cloud customers (often only to the cloud). RISE with SAP is positioned as the gateway to these advancements. What this means for negotiations is that you might leverage future innovation as part of the discussion. For example, if SAP touts an upcoming AI feature for the S/4HANA cloud, you could negotiate early access or assurances about getting those features at no extra license cost. Additionally, be mindful that by signing onto RISE, you’re aligning with SAP’s innovation stream; ensure your contract doesn’t hinder you from taking advantage of new offerings (e.g., make sure any new applicable functionality in S/4HANA cloud is included under your subscription, not sold separately). The trend is clear: SAP wants customers on the cloud to deliver continuous innovation – use that to remind them that a fair deal now secures a loyal customer for those future showcases.
• Third-Party and Hybrid Strategies: A notable portion of SAP customers are still holding back on a full RISE move, opting for interim approaches like third-party support (for ECC), selective cloud adoption, or a hybrid architecture (keeping some systems on-prem, some in the cloud). This is creating a more competitive landscape. SAP knows that if they price RISE too high or make terms too rigid, customers have alternatives – at least in the short to medium term (e.g., running ECC with third-party support through 2030 or considering other ERP vendors for certain modules). In negotiations, subtly highlight your alternatives – without overtly threatening, mention that you’ve evaluated staying on ECC longer or even considered other solutions. The market trend of some big organizations delaying S/4HANA gives credibility to your stance. SAP’s emerging tactic to counter this is offering “bridge” programs or more modular RISE options (like RISE Private Cloud Edition for those who want a more lift-and-shift approach). Stay informed about these options; sometimes SAP introduces promotional programs (for example, limited-time discounts or migration funding) to entice hesitant customers. Ensure you ask if any such programs apply to you – they might not volunteer it.
• Continued Need for Diligence: Lastly, here is an insight from many who have gone before you – the work isn’t over at signature. Market trends show that companies that actively govern their SAP cloud contract (tracking usage, meeting regularly with SAP to review value, keeping an eye on SAP’s product roadmap, and adjusting accordingly) fare much better at renewal time. Those who “set and forget” their RISE contract might find themselves in a weak position later. So treat the negotiation you’re doing now as setting the stage for an ongoing vendor relationship. Gartner-like advice in the market is to establish an “SAP Steering Committee” or similar governance body that continues to optimize your SAP estate post-move. This ensures you realize the transformation benefits RISE promises, giving you internal data to negotiate future changes. The trend is towards continuously optimizing SaaS agreements, not one-time procurement – a mindset to carry forward.

In summary, the SAP landscape in 2025 and beyond is a rapid cloud transition. SAP pulls out the stops to get customers onto RISE, and customers are becoming smarter and more assertive in negotiations. By following the 15 strategies outlined above and staying abreast of these market trends, CIOs and procurement leaders can master the art of SAP cloud contract negotiation.

The result will be a RISE with SAP agreement that achieves a favorable price and grants the flexibility, protection, and strategic alignment needed for a successful long-term partnership.

Emerging insight: A well-negotiated RISE deal can catalyze digital transformation, but a poorly negotiated one can be a source of technical lock-in or financial strain. The difference lies in your preparation and strategic approach.

Armed with this guide, you are well-positioned to land on the winning side of that equation, ensuring your SAP cloud journey is on your terms and delivers real business value.