CSM- Relationship between contract, entitlement, sold product and install base items

[Mila_M]

Hi everyone, 

I need support in figuring out with examples what is dependant/ extended by and overall, what is the relationship between contract, entitlement and how they relate to sold products and install base items. 

Is the entitlement related to the Sold Product or is the Contract related to the Sold Product? Can you share best practices while implementing CSM and specifically focusing on the data - in terms of products, sold products and install base items? 

Thanks in advance! 

Cheers, Mila 

[Tanushree Maiti]

Hi @Mila_M 

1. Contract, Entitlement, Sold Product, and Install Base Item

Contract

• Definition: A legally binding agreement between a company and a customer account or consumer, such as a Service Level Agreement (SLA) or Maintenance Agreement.
• Purpose: Acts as the primary record governing the business relationship and support terms.
• Relationship: Contracts are created for customer Accounts and serve as the foundation for support coverage.
• Example: A one-year Master Services Agreement that includes 24/7 support and agreed-upon pricing.

Entitlement

• Definition: Defines the specific support benefits a customer is eligible to receive, such as a set number of support hours, case limits, or coverage for particular products.
• Purpose: Determines the support rights available under a contract.
• Relationship: Entitlements are linked to both the Contract that provides the coverage and the item being supported (such as a Sold Product or Install Base Item).
• Example: Under a one-year support agreement, Account ABC is entitled to submit up to 20 technical support cases for its Cloud Billing Software.

Sold Product vs. Install Base Item

Sold Product

• Represents a product or service purchased through a specific order line item.
• Establishes ownership of the purchased item by a customer account.

Install Base Item

• Represents the actual deployment, installation, or provisioning of a purchased product within the customer's environment.
• Tracks where and how the product is being used.

Example:
A customer purchases five antivirus software licenses (five Sold Products). These licenses are deployed across three laptops and two servers, resulting in five corresponding Install Base Items.

2. Relationship Between Contracts, Sold Products, and Entitlements

• A Sold Product is directly associated with a Contract, as contracts typically cover the products purchased by a customer.
• While Entitlements can be linked at the contract level, they are often associated with specific Sold Products or Install Base Items to precisely control support eligibility.

Example:
A customer has a single contract covering three software products. To ensure support is available only for those covered products, three separate Entitlement records are created, each linked to its respective Sold Product.

3. Understanding "Dependent" and "Extended By"

Dependent

• Indicates a dependency relationship between records, where one item relies on another.
• Commonly used to represent parent-child relationships within Install Base structures.

Example:
A "Premium Router" Install Base Item may depend on an "Internet Service" Install Base Item because the router requires the internet service to function.

Extended By

• Refers to table inheritance within the ServiceNow platform.
• A child table inherits fields and functionality from a parent table while adding specialized attributes.

Example:

The cmdb_ci (Configuration Item) table is extended by specialized tables such as cmdb_ci_computer and cmdb_ci_hardware.

 

4. Data Model Best Practices

• Automate data creation whenever possible. Integrate with ERP or CPQ systems so that successful orders automatically generate Sold Product records.
• Create Install Base Items only after deployment. These records should reflect products that have actually been provisioned or installed in the customer environment.
• Maintain CMDB alignment. Ensure Install Base Items are properly linked to the relevant Configuration Items (CIs) in the CMDB.
• Associate Entitlements with the appropriate asset. Attach Entitlements to Sold Products or Install Base Items to accurately define support coverage and eligibility.