Insights for IT Negotiations

Microsoft had a strong start to its Fiscal 2021 and overcame the devastating impact the pandemic has had on many business including many of Microsoft’s customers. Microsoft was able to beat expectations across the board, relying heavily on its commercial cloud offerings (e.g., Microsoft 365, Teams, Azure, Power Platform, Dynamics 365, LinkedIn, etc.). Commercial Cloud revenue ($15.2B) was up 31% in Q1 and now represents 41% of total company revenue ($37.2B). Microsoft is clearly focused on pushing more enterprise customers to the all-in cloud bundle Microsoft 365, moving customers to the most robust E5 edition, getting more Azure use, ramping Power Platform adoption, and selling more Dynamics 365 solutions while taking market share from Salesforce. They have been and will continue to rely on the aggressive sales pitch that “Microsoft offers the most complete and highest value solutions for enterprises”. In this podcast, Microsoft Practice Leader, Adam Mansfield, discusses what enterprises should expect from Microsoft's sales executives who have clearly defined goals. He also shares how customers could potentially take advantage of key insights from the earnings call in their upcoming negotiations and renewals. Host: Adam Mansfield: https://bit.ly/3rPGp8r Microsoft Commercial Advisory Services: https://bit.ly/2V78ADX

ServiceNow beat expectations and exceeded the high end of revenue guidance despite COVID while also raising full year guidance. Subscription revenues were up 31% and they now have over 1000 customers with annual spends greater than $1M. ServiceNow is going to continue to position themselves as the platform enterprises need to ensure digital transformation success. They will continue to focus on pushing IT Service Management (ITSM) customers to the more robust ITSM Pro and getting customers to adopt additional products such as IT Operations Management (ITOM), HR Service Delivery, and Customer Service Management (CSM). In this podcast, ServiceNow Practice Leader, Adam Mansfield, discusses what enterprises should expect from ServiceNow’s sales executives who have clearly defined goals. He also shares how customers could potentially take advantage of key insights from the earnings call in their upcoming negotiations and renewals. Host: Adam Mansfield: https://bit.ly/3rPGp8r ServiceNow Commercial Advisory Services: https://bit.ly/3ls6VDt

On an annual basis, Workday requires clients to do a true up, to which clients ask, “How come when we do a true up, we have to pay more for overuse, but never get a refund for underuse?” Workday’s pricing, as given in an order form, represents (from their perspective) a minimum annual spend amount for the entire term. Jeff Lazarto, UpperEdge’s Workday practice leader, discusses why Workday has these pricing structures in place and why you are likely to have to pay more for Full-Service Equivalent (FSE) worker counts and SKUs after each true up. For a more in-depth analysis of Workday’s payment structures, download his recent webcast recording: Ask the Experts – Workday Licensing. Host: Jeff Lazarto: https://bit.ly/37eCXdN Workday Commercial Advisory Services: https://bit.ly/3fq96DV

Many Workday customers are concerned about paying subscription fees in year 1 of their contract while they are going through their deployment. Workday’s typical response is that everyone must pay in year 1 because it is a cloud platform and they are constantly innovating—even while you’re deploying. However, Workday has started to make some exceptions to this position. Jeff Lazarto, UpperEdge’s Workday practice leader shares insights into these exceptions. For a more in-depth analysis of Workday’s payment deferrals and structures, download his recent webcast recording: Ask the Experts – Workday Licensing. Host: Jeff Lazarto: https://bit.ly/37eCXdN Workday Commercial Advisory Services: https://bit.ly/3fq96DV

Workday deals consist of a number of factors and unique challenges, the top questions customers have is around pricing— e.g. “Is our proposal pricing from Workday a fair one?”, “Is our prior deal a good one?”, “Where do we stand within the market?”. To start answering these questions, you need to look at your benchmarking factors, which consist of list prices, discounts, net fees on a line-item basis, full service equivalents (FSEs), SKUs and more. Jeff Lazarto, UpperEdge’s Workday Advisory Leader breaks down the components of a Workday deal in this podcast, and in his recent Workday Webcast downloadable at upperedge.com. Host: Jeff Lazarto: https://bit.ly/37eCXdN Workday Commercial Advisory Services: https://bit.ly/3fq96DV

If you’re an existing SAP customer, how can you determine what your licensing requirements are under the Digital Access Model? Truth be told, the answer hasn’t gotten any clearer. SAP has since introduced a Digital Access Evaluation service to help, however this is a guise for a soft audit which SAP will use to find gaps in your licensing to immediately monetize. Chip Hanna, UpperEdge’s Advisory Practice Director discusses these issues and more in this podcast and in his blog, “SAP and Digital Access – It’s Still a Mess” Host: Chip Hanna: https://bit.ly/37gknCk SAP Commercial Advisory Services: https://bit.ly/3yjImwb Related Blog: https://bit.ly/3yoIOcm

Many customers are sharing their financial challenges with their system integrators - especially as it relates to priorities, allocation of funding, and the state of the business. But asking your SI what staffing issues they may have and where they stand in relation to their own revenue targets is equally important as it can shed light on whether your SI is willing to commit to more collaboration. In this podcast, Chip Hanna, UpperEdge’s Advisory Practice Director, discusses four strategies for working with your SIs during times of financial uncertainty. Listen for more insights and read Chip’s blog, “4 Strategies for Engaging SAP SI's During This Downturn”. Host: Chip Hanna: https://bit.ly/37gknCk SAP Commercial Advisory Services: https://bit.ly/3yjImwb Related Blog: https://bit.ly/2WHpAki

Google has rebranded G Suite four years after launch, renaming it to Workspace while also creating new pricing tiers to appeal to current and targeted enterprise customers. Google, and Head of Workspace, Javier Soltero (former VP of Office Product Group at Microsoft), understand that Google must continue to innovate, integrate their productivity and collaboration tools, and craft new editions in order to have a better chance to take market share from Microsoft and keep Slack out. In this podcast, Practice Leader, Adam Mansfield, covers the announcement and what it means for enterprises moving forward.

SAP’s hosting option, HANA Enterprise Cloud (HEC) was launched in 2013. In 2019, SAP shifted its focus and launched Project Embrace to add support for the hyperscalers (Amazon, Google and Microsoft Azure). These moves by SAP are to prepare their customers for the end of ECC support in 2027. Brian Undlin, UpperEdges IT Sourcing Analyst, discusses where and how to host SAP, hosting licensing strategies, architecture needs and more. Read Brian’s blog, Shrinking Markets Force Customers to Re-Evaluate SAP Hosting Options, for additional insights. Host: Brian Undlin: https://bit.ly/3ysLKVK SAP Commercial Advisory Services: https://bit.ly/3yjImwb Related Blog: https://bit.ly/3xh4OEJ

Chip Hanna, UpperEdges Sr. Director answers 3 questions regarding the Qualtrics IPO and its impact on its customers. 1. How much control do you have in your agreement with Qualtrics now and in the future? 2. If considering a major investment in Qualtrics, or the C/4HANA Suite, should you buy now or wait until after the IPO? 3. How does this all fit with your plans to migrate from ECC to S/4? Host: Chip Hanna: https://bit.ly/37gknCk SAP Commercial Advisory Services: https://bit.ly/3yjImwb