Most organisations spend approximately twenty five per cent of their IT budgets on software. Because it is not a physical asset, like a computer, a desk, or a chair, software is difficult to keep track of and inventory. The problem gets exponentially more complicated when you consider complex environments (i.e. tracking software on premises, in the cloud, on mobile devices) and the dynamic nature of organisations (i.e. how to track software ownership/use in the midst of mergers, acquisitions, employee hiring and departures, etc.).

Organisations must also track how that software is being used – and whether that use is compliant with the software contract. For instance, each licence agreement contains Product Use Rights that define acceptable software use. If usage exceeds those terms, the organisation would be considered out of compliance, and therefore subject to expensive and unbudgeted ‘true-up’ penalties.

SOURCE: itproportal.com