Compliance puts new focus on managing software license agreements

The more things change, the more they stay the same. Keeping track of software licenses and contracts that permit their use is not a new problem for IT managers. Software asset management (SAM) has been on the list of priorities for a long time. But IT governance and compliance are raising the bar for this and other IT disciplines.

Network, system, and application managers all have to pay attention to SAM in today’s business environment to manage costs, contracts, and compliance with regulations and corporate policies.

In recent research conducted by Enterprise Management Associates (EMA), we found that those companies looking at advanced asset management systems and processes have a strong focus on SAM. This research will be published in June as “Next-Generation Asset Management: Service, IT Finance, and Asset Management Unite.”

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The more things change, the more they stay the same. Keeping track of software licenses and contracts that permit their use is not a new problem for IT managers. Software asset management (SAM) has been on the list of priorities for a long time. But IT governance and compliance are raising the bar for this and other IT disciplines.

Network, system, and application managers all have to pay attention to SAM in today’s business environment to manage costs, contracts, and compliance with regulations and corporate policies.

In recent research conducted by Enterprise Management Associates (EMA), we found that those companies looking at advanced asset management systems and processes have a strong focus on SAM. This research will be published in June as “Next-Generation Asset Management: Service, IT Finance, and Asset Management Unite.”

Respondents included nearly 300 IT and business executives - a group that validated interest in SAM overwhelmingly. When asked of the relative importance of SAM in the context of broader asset management, 70% of survey participants indicated that software license management is either important or very important. From a cost perspective, survey participants were also very concerned with managing software license costs. Eighty percent of the participants in this survey felt that software license costs were important or very important.

SAM boils down to the management of software licenses, taking many license forms ranging from the SaaS subscription model to concurrent and individual license arrangements with many complexities and nuances in between.

Beyond the very basic goals, enterprises implementing SAM have a lot of questions to resolve. What software is owned and how are we gaining access to license privileges? Have we purchased adequate licenses along with future planning needs? What are the compliance risks? Can we save money by re-allocating existing licenses? Complexity in license structures has developed over time, aimed at meeting the needs of buyers, and evolving as software has matured. The benefit is also the challenge for managers of software assets.

Managing software assets are not unlike managing other IT assets. Software assets have a lifecycle that involves planning for requirements, procurement, deployment, ongoing operations, evaluation of whether or not the product continues to meet company needs, renewal and/or replacement strategies. The differences are in how integral software applications are to daily business life, compliance issues, and the huge expense for licensing these products.

Successful SAM initiatives in any organization need to be about the enterprise and its business requirements. IT and project managers for software assets will need to carefully look at the following if they are to be succeed in effectively managing software:

• Business drivers. Consider the major business objectives and how these relate to IT budgets and compliance requirements.
• Plan for short-term success. Tackle SAM in bite-size pieces, taking on the most costly or most important applications but not the most complicated.
• Drive ahead by building on successes. For SAM, this means continuing the process of expanding coverage to other software products in use.
• Education primarily about compliance and related policies. Users must understand that SAM is being deployed for a very legitimate reason and that policies are not happenstance. They exist for a reason.
• Monitoring. Ongoing monitoring to create a feedback loop.
• Quality improvement. Based on accomplishments as seen through auditing, metrics, and expanded best practices.