Demystifying software asset management

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by | February 4, 2019

Keeping track of software and licences has traditionally been a compliance requirement. However, many organisations struggle with this, from knowing what software they have, to what licences they are or are not using, to knowing if their software is up to date or outdated.

Businesses need to understand there is a level of risk if they do not have a handle on their software licensing and how it works, says Matthew Poulter, SAM Business Unit Manager at First Technology National.

This can lead to overspending, paying for licences they may not be using, or potentially have software in their environment that is unlicensed. Software asset management (SAM) can assist businesses to know what they have, what they are using and how best to apply their software licences.

What is SAM?

SAM isn’t necessarily a product or service, but rather a set of best practices that involves assessing, managing, and optimising a business’s software and licensing. The licensing of software is often a business’s most costly and valuable IT infrastructure component. Unlike hardware, you cannot touch or see software licensing, and as a result, a set of disciplines is required to manage it.

SAM combines various methodologies, best practices and technology to effectively evaluate and control an organisation’s software. There is no single predefined approach; there are, however, suggested guidelines and frameworks that businesses should employ in order to ensure they know what software and licences they have and how to get the most out of them without wasting money.

SAM myths

Many organisations erroneously assume that SAM is an audit engagement run on behalf of software vendors. They believe SAM is a punitive exercise whereby punishment and fines will be levied if the business is found to have unlicensed or illegal software, or under-utilised licences. The reality is that SAM should be used as a vehicle to ensure you are properly informed about your software estate, and this is an organisation’s first and most effective defence against any kind of punitive audit.

Small to medium-sized enterprises (SMEs) are often targeted and may find themselves surprised, because they think their IT department (in-house or outsourced) has managed their software and licences. However, the IT department often architects the hardware but fails to include software and licences into the plans. Putting in a SAM practice ensures the business is correctly licensed.

SAM is an intentional exercise, practice or discipline that manages some of your business’s most valuable assets. There are many business benefits it offers.

Business benefits of SAM

Apart from the obvious benefits, licence compliance and mitigation of risk, SAM can also assist with better decision-making.

In some cases, businesses enter into an agreement with a software vendor and make an upfront commitment for licences. This seems like a great decision because of potential discounts and other benefits. The unfortunate thing is that, sometimes, businesses don’t end up getting around to deploying the software they have purchased right away. In this way, businesses can then find themselves in possession of licences they are not using.

When businesses understand their environment, it puts them in a better position to negotiate with software vendors. They are less likely to be sold unnecessary products or licences and, knowing their exact needs, they can demand better price points based on actual rather than presumed quantities. Implementing SAM can help inform you to make insightful licensing decisions.

SAM helps organisations to know what they have so they don’t overspend or waste expensive software investments.


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