In part one we looked at why the Software Asset Management program needs to keep in-step with the changing business requirements through periodic reviews and better dialog with other stakeholders.
In part two of this blog series, we’re going to look at a couple of ways that updating your SAM framework can directly affect bottom-line costs across the organization:
To “Sweat” Assets
Sweating assets is not a new concept. But the adoption of cloud, virtualization and mobile technologies are changing how we assess whether assets are being used to their full potential or if they are actually causing a financial drain. If you’ve ever had to complete a software audit (with around 65-70% of organizations being hit with a least one software publisher audit each year, you’ll have been very lucky to avoid one!), you’re probably already familiar with a compliance report.
Is a general rule of thumb, if an application is installed on a device (or, increasingly, if it is available to an individual user), you need to pay for it.
But if that app is not being used (or perhaps not even being used in a particular way with a set frequency), what value is the license for it delivering to the organization?
Understanding the usage of software can pay huge dividends in lowering expenditure by making unused licenses available to other users, or cancelling the support and maintenance on surplus licenses.
This form of analysis can be extended to identify opportunities and support the business case for consolidation of hardware platforms, virtualization (we’ve all head of virtualized server ‘sprawl’) and even the wholesale move to new platforms such as cloud computing.
Similarly, services already delivered from the cloud can also be optimized by better tracking who is actively using licenses versus who is just costing the organization money in the form of unused licenses.
Continuous improvement in this instance might center on creating a baseline of an acceptable condition of your IT estate, with a view to ensuring that devices and software are (wherever possible) placed with the most appropriate individuals/departments to match business needs. Again, consideration needs to be given as to whether the SAM program should be extended to cover ‘new’ platforms such as mobile, virtual and cloud assets.
Improving IT project funding
It’s worth taking a step outside of IT for a moment, and viewing how the world of finance views Software Asset Management and SAM activities.
Being able to uninstall and re-use software is considered a cost avoidance measure, as it prevents your company from wasting funds on unnecessary purchases. In the eyes of many accountants, that might score “10 out of 10 for effort” but doesn’t really get them too hot under the collar. The finance to underpin the IT budget has already been granted; undoubtedly common sense dictates that value for money is a good thing to strive for, but sometimes its difficult to argue how cost avoidance adds to the bottom line. A better way to look at cost avoidance might to think of it not as ‘money saved’ but instead ‘money made available for other projects’.
I doubt there are many IT functions in the world that would happily agree that they have all the budget they need to get important projects done.
Well, cost avoidance through better and more current SAM practices could be the way to secure funding to get at least some of the projects currently on the back-burner into production. And if those projects themselves can be shown to directly support business goals, then the IT and SAM teams can become the business-enablers.
That, of course, assumes that money saved by IT gets to stay within IT! And that’s why having a good dialog with the other business units is so important to successful SAM. In the next part of this blog series, we’ll look at what ‘best practice’ in Software Asset Management really means and how SAM can be used to drive competitive advantage.