Here’s one to get your mind juices flowing. According to Forrester Research, up to 80% of an enterprise IT budget is spent on maintaining existing investments. If you are a business paying a supplier £250,000 per annum for maintenance, are you getting good value for money? Most customers would say ‘no’. If you call for support  times a year that’s £50,000 per call. Is it worth that much? Probably not. And when you consider suppliers make up to 85% rofit margin on maintenance charges, it does suggest that maybe some maintenance contracts aren’t worth continuing with, especially if they product is end-of-lifeing or no longer business critical.

SAP is changing because it needs to find different ways to make money. Companies like SAP and Oracle are under some pressure to generate more revenues from their customer base. They are spending more time farming their client base for new revenues than they are hunting for new clients. So if you thought you had signed a big cheque to SAP a few years ago and that would be that, then think again. You’ve probaby noticed that your SAP sales rep is calling at least once a quarter now and his support team will be mining deep into your organisation to create new opportunities if none are currently on your budget plans. And you’ll be well aware of the furore created when SAP announced it was planing to raise it’s annual software maintenance and support costs from 17% to 22%. Still, it’s no all bad news and there is some good news filtering out; SAP as long been working towards changing its software licencing pricing policy to give greater choice. While you can still choose to pay for the whole lot upfront, they can also offer phased payments and subscription licencing. Remember to ask your SAP sales rep for financing options whenever they present a proposal to you.