Gartner forecasts that in 2020, global IT spending will have a 3.7% growth. A main driver for this growth is the enterprise software spending.  No wonder that companies feel the need to have control over their IT budgets and more specifically, their enterprise software spending.

Another Gartner study shows that software asset management (SAM) became imperative for C-level executives. This, since SAM offers support for strategic business development. This doesn’t mean an increase in spending on software licenses, but an awareness of how to better manage the budget and the software consumption. Having an efficient SAM strategy in place means opportunities for cost savings and cost optimizations. This is a trend in the market.  Many organizations are however at the beginning of their SAM journey.

In this article we will outline the benefits of SAM for your company and how to better spend your resources. If you are just starting your SAM journey, you may ask yourself why is SAM such a big deal. How can this help you and which areas of your business will benefit from it? Based on our knowledge, research and experience, we will give you 7 reasons why it is important to invest in SAM.

Control software spending and achieve cost savings

SAM creates visibility on your software entitlements and deployments and helps you identify opportunities for savings. This is directly related to budgets and spending on software. Software asset management can offer an overview of your licenses and their usage, so that you can easily be able to forecast future use and align it with your business goals. At the same time, you can reduce the number of unused licenses and their associated support fees.

Avoid compliance issues

Yes, we’re talking about the software audits! With SAM, you can identify and fix any gaps before the audit, avoiding the financial risks that may come as a result of under-licensing. An active SAM practice will enable you to be prepared for a software audit. One way of doing this is through regular pro-active internal license reviews.

Optimize software consumption

SAM is the first step in optimizing your software license portfolio. It helps to eliminate overbuying and over-licensing. You will only buy what you need and gain a better understanding of your software requirements. You will be able to identify any gaps and if the licenses are being used in accordance to the terms and conditions agreed. This can reduce the financial risks in case of a software audit.

Improve your negotiation position

When you have an effective SAM practice in place you are in a better position to negotiate agreements for new license purchases, support renewals or reduce the maintenance costs for unused licenses. This, because you already optimized the existing software licenses and identified the unnecessary costs. When you have a clear overview of your company’s actual software consumption and the forecasts for future usage, you can negotiate accordingly.

Improve systems security, data integrity and data security

Many times, organizations allow their employees to download unauthorized and/or unsupported programs on their computers, exposing the infrastructure to risks. By implementing a SAM practice, you can identify these programs, decrease security risks and prevent cyber-attacks that could affect customer information or other sensitive materials. The majority of cyber-attacks come from assets that are unauthorized or no longer supported by the publishers (e.g. old Java releases).

Increase operational efficiency

SAM is not only related to the IT department, it is cross-functional, including other areas of your business. It has an impact on your operations and can make them more efficient. There are benefits on multiple areas: standardization of your IT landscape, identity management, software purchase and distribution and procurement process.

Improve data quality to enhance business decisions  

This one relates closely to the previous points. Accurate and correct data about your software assets, documents and usage, can help you make better decisions. SAM will help you to make informed decisions supporting your IT and business strategy.