Business Situation
SAP Entitlement Management is a backend system that is integrated with SAP Subscription Billing according to order creation process.
The entitlement creation process runs without any action from James, the order agent at Print2You.
SAP Entitlement management is integrated via SAP Cloud Integration in the system environment of Quote-to-Cash.
James has a look into the system, he is interested in following the entitlement lifecycle.
Let's see where SAP Entitlement Management comes into play within the solution order process.
Entitlements are rights awarded to a business partner, such as ACME Inc.. These rights are contractually agreed to and may include access to a cloud service, technical support, software licensing, warranty, and more. Let’s learn more about the SAP Entitlement Management process and how it relates to our printing as a service business example.
What is SAP Entitlement Management?
Entitlements are rights awarded to our customers when a contractual agreement is made. Entitlement rights may include access to a cloud service, technical support, warranty claims, training, software licensing, and other services and support items related to a purchase.
The table below uses our printing product as an example.
| Offerings | Printing Service Access | Software License | Service Usage | Printer Warranty | Printing Training |
| Entitlement Rights | Use printing service | Number of software users | Right to print | Product exchanges | Training services |
| Definitions |
| 10 software licenses | Relating to features, print, copy, scan For example, a monthly service for 10,000 prints or scans | Right to exchange printer:
| Access user manuals 2 hours online training |
The table above lists several entitlement rights possibilities. Consider the entitlement rights for Printing Service Access with a company that has 200 staff members using 50 printers. The number of rights managed can easily reach over 10,000.
SAP Entitlement Management is a central point of customer entitlements and optimizes digital deliveries. SAP Entitlement Management has its own lifecycle within SAP Subscription Billing, as shown below.
Control Access
Assuming you have 50 users that are allowed to use 50 printers, you have 250 rights that can be controlled.
SAP Entitlement Management manages any right of usage, authorization, privilege, access, or permission that is given to a customer. These "rights of usage" are called entitlements and can be software-specific, such as licenses, downloads, updates, free trial periods, and so on. They can also relate to maintenance and support services, training, as well as warranties for physical hardware.
The Lifecycle of SAP Entitlement Management
Lets break down the above lifecycle:
The entitlements managed by SAP Entitlement Management may come from a variety of sources, including Subscription Billing, Sales Order, or Material Management.
- Entitlement Creation: Entitlements can represent a simple item, such as access to printing service software. It can also represent a complex package of services with many entitlements, including access, warranties, licenses, and services that controlled by usage.
- Cataloging: This step catalogs entitlements for effective management and easy searchability. It also assigns entitlements to customers based on their purchases.
Status Activation: Activate entitlements to provide customers access to products or services they are entitled to. In our printing as a service example, the activation is synchronized with the subscription in SAP Subscription Billing.
Utilization Tracking: Track customer usage of entitlements for a better understanding of how entitlements are being consumed.
Repackage or Reallocation: Based on usage information and triggering, reallocation, and repackaging of entitlements among different customers may optimize utilization.
Audit: Regularly audit your customer for under or over-usage of the entitlements purchased. These reports provide valuable insights into sales, usage trends, renewal rates, and other facts that impact business decisions.
- Change and Upgrade Entitlements: Manage renewals of entitlements with customer notifications of expiring entitlements and the processing of renewal requests. When a contract ends or a customer discontinues service, you can easily terminate the entitlements. Deactivating unused entitlements is an essential part of entitlement management.
SAP Entitlement Management provides entitlement audit capabilities also, as you can see from the below figure.
Now that James has a better understanding of how SAP Entitlement Management helps streamline the Quote-to-Cash process by managing entitlement rights given to customers, he would like to know how this process can help his printing as a service business. Let’s continue to the next lesson!