The move to SAP S/4HANA changes SAP licensing from Named User categories to SAP Full Use Equivalent (FUE) licensing, supported by the STAR measurement matrix. Different user types (Advanced, Core, Self-Service, Developer) consume FUEs at defined conversion ratios, so user misclassification and legacy ECC roles can inflate licensing requirements. By analysing roles, authorisation objects and actual usage early, organisations can optimise FUE consumption and reduce unnecessary costs.
SUMMARY: In this blog, Roy Topham explains how the move to SAP S/4HANA changes SAP licensing from Named User categories to SAP Full Use Equivalent (FUE) licensing, supported by the STAR measurement matrix. Different user types (Advanced, Core, Self-Service, Developer) consume FUEs at defined conversion ratios, so user misclassification and legacy ECC roles can inflate licensing requirements. By analysing roles, authorisation objects and actual usage early, organisations can optimise FUE consumption and reduce unnecessary costs.
For many organisations planning their move to SAP S/4HANA, the conversation often begins with familiar questions:
There is no doubt that these are important questions. But there is another topic that often enters the conversation much later in the journey, which can have a significant impact on the final cost of the solution.
As organisations transition towards SAP S/4HANA, the way SAP licences are calculated changes significantly. The traditional Named User model is replaced by FUE, where different user types are converted into weighted licence values that determine overall subscription costs.
Furthermore, SAP has introduced the STAR measurement matrix, so that the license categories are now determined by certain authorisation objects and their activity values assigned to the users.
At first glance, the model appears straightforward. Yet for many organisations, it introduces a new layer of uncertainty. It isn’t about how many users exist in the system; the real question is whether organisations have a clear understanding of their FUE requirements before entering licensing discussions with SAP.
Historically, SAP licensing was built around Named User categories. Organisations purchased licences according to defined user types, and those licences were assigned directly to individuals within the system. While the model had its complexities, the relationship between users, roles, and licensing was relatively visible.
Then, the introduction of FUEs changed that dynamic. This licensing model applies to both SAP S/4HANA Cloud ERP Public Edition and Private Edition. Instead of counting users individually, organisations now operate within a pool of FUE capacity. Different user categories, such as Advanced, Core, and Self-Service users, contribute different weighted values to the total licensing requirement.
FUE conversion ratios typically follow this structure:
This means the total cost is no longer determined purely by the number of users, but by how those users are classified within the system using predefined ratios. Under this model, user misclassification can have a huge impact on FUE consumption, and therefore licensing costs.
The FUE concept and STAR measurement described here are primarily applied in SAP Cloud ERP editions. However, the STAR measurement programme is also commonly used in on-premise S/4HANA installations to assess user licence requirements. In these cases, while traditional licence types may still be purchased separately, the same principles around user classification and access analysis continue to play an important role in determining overall licensing exposure.
Many organisations assume that their existing ECC roles can simply be carried forward into their S/4HANA environment, with minor adjustments for new and deprecated transactions. After all, these roles have supported the business for years and are deeply embedded in operational processes.
However, most legacy roles were never designed with the FUE licensing model in mind. Over time, role structures often accumulate additional access through system changes, temporary permissions, or evolving operational requirements. What begins as a practical solution to support business processes gradually becomes a complex collection of authorisations.
Under the FUE model, this complexity can have unintended consequences. User classifications are heavily influenced by the authorisation objects assigned within roles, rather than what users actually do in the system on a day-to-day basis. This means a user who rarely performs advanced tasks may still be classified into a higher licensing tier simply because their role technically allows it.
When organisations carry forward legacy roles without examining how they translate into FUE classifications, licensing requirements can quickly become inflated.
In many S/4HANA transformation programmes, licensing discussions only become serious once contract negotiations begin. By that stage, organisations may already be working with rough estimates rather than a clear understanding of how their access design translates into FUE consumption.
This is where unexpected challenges can emerge. What initially appeared to be a manageable licensing requirement during early planning may change significantly once user roles and authorisations are analysed more closely.
Without visibility into how roles influence FUE classifications, organisations risk committing to subscription levels that do not accurately reflect how their systems are used.
This lack of clarity doesn't only affect licensing costs. The number of FUEs purchased also influences the infrastructure size provided under SAP’s T-shirt sizing methodology. As a result, reducing FUE exposure without proper planning could lead to insufficient memory or storage being allocated. However, in most cases, it is more cost-effective to add Memory Extensions, App servers and non-productive tiers to the BOM, than to overpay for FUEs that are not required. Ultimately, organisations should avoid allowing inflated FUE numbers to drive higher infrastructure costs unnecessarily.
The journey to SAP S/4HANA is often framed as a technology transformation. In reality, it is also an operating model transformation.
Licensing decisions are now closely connected to areas such as security design, role architecture, and access governance. Choices made in these areas can have a direct impact on long-term subscription costs.
Organisations that approach licensing strategically often begin by analysing how their current access design maps to FUE classifications. They then look at what their users are actually doing in the system. This provides an opportunity to align user access with actual business requirements rather than historical role structures.
By doing so, licensing becomes something that can be actively managed rather than passively inherited.
The transition to SAP S/4HANA already requires organisations to navigate complex decisions around technology, processes, and operating models.
Licensing should not become an unexpected obstacle along the way. Understanding how FUE licensing works, and how existing roles influence those calculations, allows organisations to approach their transformation with far greater clarity.
Solutions such as Soterion’s SAP License Manager help organisations gain this visibility by analysing user roles, access rights, and system usage. This provides a data-driven view of licensing consumption and helps identify opportunities to optimise licence allocation, reduce unnecessary costs, and prepare for licensing discussions.
Those that take the time to analyse their access structures early in the journey place themselves in a stronger position to navigate contract discussions, optimise licensing costs, and align their SAP landscape with the way the business actually operates.
In closing: Organisations that proactively manage their licensing strategies will not only reduce unnecessary costs, but also position themselves for greater agility and resilience in an increasingly digital business landscape.