By Kirk Clausen
If you were to ask the CIO or the CFO of a typical enterprise how much of their IT budget is spent on software, you will most likely get an answer of “too much”. Yet, the normal justification to invest in a Software Asset Management (SAM) program is to focus on license compliance – normally motivated by an upcoming true-up or software audit. A team is put in place and there is a large project to collect inventory and purchase records with the end result being a license compliance snapshot. The data is then shelved until the next time a license position snapshot is needed. If the organization is lucky, they may even find an opportunity to save some money on one or two software products.
In my years of experience in IT Asset Management, I have never worked with a single customer who was not overspending on their software. I tell customers that the focus of the enterprise should not be a point-in-time SAM solution. The end goal should be a combination of Software License Optimization tools and processes that enable the organization to proactively optimize their software spend on a continuing basis. This is a much more compelling sell to the C-level executive that needs to approve an investment in SAM and software license optimization. As you will see, the software license compliance piece is not left out with this optimized approach; it is an absolute requirement.
Two Approaches – License Compliance vs. License Optimization
Here we look at the traditional approach to software asset management and then show how this is taken to a higher level when the emphasis is on license optimization.
Compliance-Based SAM
- Obtain an accurate hardware/software inventory
- Obtain accurate software license entitlement data and then match this to your inventory to determine a license compliance snapshot.
- Repeat steps 1 and 2 as needed; usually as a highly manual and time consuming process that does not help avoid software audits or reduce ongoing software spend.
Software License Optimization
- Obtain an accurate hardware/software inventory
- Obtain accurate software license entitlement data and then match this to your inventory to determine a license compliance snapshot.
- Using our initial compliance position as a baseline, put tools and processes in place to continually keep inventory and purchase data up-to-date to enable continuous license compliance.
- Collect accurate hardware/software inventory on a periodic basis
- Collect accurate software license entitlement (purchase order and contract) data in a central asset management repository
- Optimize your software spend and license position by taking advantage of software Product Use Rights and what has been negotiated in your licensing contracts/agreements to ensure that you are only buying the licenses that you need for the software that you use. Just because a piece of software is installed on a computer does not mean that it needs a license—it all depends on your license entitlements for that software.
- Use Business Intelligence to help predict future software needs based on past trends and empower proactive license negotiations with your software vendors. Enable accurate budgeting.
This approach to managing the software estate enables the enterprise to find that optimal “sweet spot” where it is in balance and is neither over-spending nor under-spending on software licenses and maintenance, and can proactively remain at that position.
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To learn more, please read the Gartner report on Software License Optimization Vendor Overview.