Q&A: Why software asset management is so often overlooked by CIOs

Despite the fact software asset management (SAM) has been a key IT management practice for a long time, its reputation is less than favourable.

  1. Why has software asset management (SAM) become a much-maligned ‘tick-box’ exercise?

Despite the fact software asset management (SAM) has been a key IT management practice for a long time, its reputation is less than favourable. Due to the complexity that tackling SAM often entails and the difficulty in understanding the typical software agreement, it is often seen as a tedious necessity to ‘tick off’ the to-do list – instead of an opportunity to add value to the business by improving its execution.

The potential for fines and non-compliance when it comes to software is enormous, with audits costing businesses thousands if the correct licenses are not in place. However, there is more to SAM than avoiding fines. Businesses need to stop going through the motions and start strategising ways to benefit from SAM. By changing this mindset, IT teams can not only make savings, but better streamline software use across the entire organisation.

  1. When it comes to SAM, what are the biggest factors complicating it that CIOs/IT teams must be aware of?

Software agreements have always been extremely complicated and deciphering the terms and conditions without an expert on hand is a big challenge. This has become even more of an issue for enterprises in recent years with emerging trends and technologies adding a new layer of complexity.

>See also: Software asset management: reducing IT costs

We now work in a completely different way to decades past. Mobile workforces are growing, and employees now operate from countless locations spanning many time zones. This makes it harder for CIOs and IT teams to monitor software usage, which can result in huge licensing implications. For example, if an employee is using a free trial version of a program that is not free for business use, enterprises can become non-compliant without even knowing.

Businesses must have systems in place that help them truly understand their software consumption and avoid being caught out for non-compliance, or conversely, overpaying for licenses that are going unused. In the case of SAM, knowledge is power.

  1. How has digital transformation and the shift towards cloud impacted SAM?

Digital transformation has completely altered our understanding of licensing, with both cloud computing and the rise of mobile devices complicating things for businesses. Tracking software assets has become far more complex as there is no longer a fixed number of users, workloads or devices throughout an organisation.

Additionally, moving to the cloud can change the licensing position of custom built applications. Businesses with applications built in-house that have re-architected them to move to the cloud can run into numerous location-based issues. Where this application would previously have been ‘sitting’ on a single owned server, it now resides in a dynamic environment consisting of virtual machines across multiple locations, all of which have licensing considerations.

The advent of these digital advancements makes cloud management even more critical to the IT success of a business as assets are now dispersed. If left unmanaged, cloud sprawl can quickly spiral out of control.

  1. What are the steps that businesses should take to implement robust SAM practices?

The key to implementing a robust SAM approach is clarity. Organisations need comprehensive, real-time visibility into their software estate to determine if they over or under licensing and to make the necessary adjustments. This visibility also helps organisations reduce costs by optimising licensing – something Gartner believes can save up to 30% on software costs – this could include ‘bundling’ licenses, recovering and reusing unused license rights, or cancelling unnecessary maintenance and support contracts.

>See also: Should data be listed on the balance sheet as a business asset?

This can be achieved by installing a software management ‘layer’ that helps solve issues within the current licensing estate. Increased transparency helps CIOs and purchasing managers make more informed, confident decisions on software use. It also generates data for analysis, so CIOs are well-equipped with a solid, factual business case for any contract negotiations, ensuring software investments deliver value back to the business.

  1. What are the biggest SAM challenges that businesses face in the next 2-5 years?

While cloud computing and mobile devices will continue to be a huge factor in SAM challenges, platforms such as the Internet of Things (IoT) and a general growth in workplace connected devices are set to cause issues for businesses. These technologies will add another layer of complexity, with the IoT in particular raising difficult questions about licensing. One such issue is ‘indirect licensing’ – the theory that every single one of the potentially millions of connected devices reporting to a database via an API may be identified as a single user, and so need an equivalent license.

What is clearer than ever is organisations cannot afford to treat software licensing as a necessary evil, but instead must make it a strategic business priority.

Article contributed by Tony Spruyt

Avatar photo

Michael Baxter

.Michael Baxter is a tech, economic and investment journalist. He has written four books, including iDisrupted and Living in the age of the jerk. He is the editor of Techopian.com and the host of the ESG...

Related Topics

Software Asset Management