Microsoft Audit: 10 Powerful Tips to Help You Take Back Control

If you have ever been involved in any aspect of enterprise licensing for your company, you may have faced the uncomfortable reality of the Microsoft Audit.

Not only can Microsoft’s Audits seem extremely invasive, it also requires a huge amount of your company’s time and energy to complete. The fact of the matter is, Microsoft Audits are not going away since they serve as a huge revenue-generating tool for Microsoft.

These audits might be presented in a variety of diverse ways; they might be called by a softer name, like Software Asset Management (SAM) engagements or reviews, and they might act like a friendly opportunity to optimize your licensing, calculate your annual true up, or navigate a license metric change (like processors to cores).

Always remember the goal of the software vendor though – they’re less interested in compliance and more interested in driving sales and revenue.

The amount of data required for a Microsoft Audit – in order to determine the licenses that you own, what products you have deployed, and how many licenses you actually require – can be overwhelming. Companies that are facing an audit can often be paralyzed by the massive volume of data presented.

As a business, you need to be proactive in managing the audit experience.

At MetrixData360, we’ve helped many clients through such a trial, so we know exactly what you need to do to prepare for any Microsoft audits that might be approaching.

Here are our top 11 tips and observations to help you successfully navigate the muddy waters of a Microsoft Audit.

Top 11 Tips on How to Handle A Microsoft Audit

  • Don’t Go Dark on the Software Auditor

If you are confronted with a SAM review, it is technically an optional engagement that you can decline, however refusing a SAM review will often result in you receiving a full legal audit.

Ignoring a software audit, on the other hand, can leave you in breach of your contract and Microsoft can take you to court. The financial and reputation damage that can ensue from such an event can be costly. So whatever you decide to do about your SAM engagement or audit, you should never just ignore it.

  • Define the Scope and Get a Non-Disclosure Agreement in Place

You can actually negotiate what data will be shared in advance of the audit by defining the scope of the audit.

Keep in mind what the auditors are here for — your money. By leaving the scope undefined, the auditors will keep searching through your data until they find something that meets their estimated return on investment.

You will also need to get an NDA in place with the third-party auditor that the software vendor may hire stating that no data will be shared with the software vendor without your explicit and written permission.

  • Data Is the Key – Get the Facts and Know Them Inside and Out

Have a strong understanding of your software in terms of deployment and licensing long before the auditors arrive. Not only will this lower the chance of an over-inflated compliance gap, it will also reduce the likelihood of being audited again by the same vendor.

Microsoft is more likely to come after you if they see you as a potential target for revenue. So, conducting an audit in an organized fashion that effectively captures what you actually owe will make you less worth the effort to audit a second time.

You should also perform internal audits regularly to maintain a strong knowledge of your internal environments, even if you are not currently being audited.

  • Be Prepared to Put In the Time

Whether it’s your own SAM team or a hired expert, the audit process is going to be time- and resource-consuming. Do not treat this audit like a side-project that is tossed at Procurement or a junior IT staff member.

If the auditors tell you that the audit will take no more than four weeks, take their word with a grain of salt since the average software audit or SAM engagement, from our experience, can take anywhere from six months to over a year.

  • Understand Your License Position

The Estimated License Position (ELP) takes all of the deployment data (inventory counts) and provides a view of the number of each product and version deployed then it will compare that against the number of licenses you own (simple to understand in theory, more complicated in practice).

If you are in a software audit, the third-party auditors hired by the software vendor to review your data will make their own licensing position for you. Any mistake they make will only inflate your compliance gap, which means more money for them. Do it yourself, creating your own ELP will give you something to challenge the auditor’s findings with and it will make sure it accurately reflects your usage.

  • Prepare to Explain Your Deployment Data

You need to know the numbers better than they do, so that you can make a proper defense for yourself during the settlement.

Do not allow external sources to make assumptions based on their limited knowledge of your software deployments and usage. They will always pick the worst-case scenario that results in the largest penalty possible for you.

  • Negotiate Before the Auditor’s Findings are Handed Off to Microsoft.

Ensure the ELP truly represents your environment prior to signing off to be released to Microsoft. If you have an NDA in place, you’ll be able to do this effectively.

  • Prepare to Respond to Unreasonable Requests.

You need to be confident in how your numbers are represented in your ELP, or your company’s IT budget will suffer from an over inflated compliance gap. If you don’t know what the software vendor is asking for, you could very easily help the vendor build a case against you.

  • Know Your Escalation Paths

Do not be afraid to escalate when and where it makes sense. Many businesses make the mistake of not offering a counteroffer to the auditor’s initial settlement price. They see it as set in stone but data can be interpreted differently and through negotiations, your penalty has the potential of being greatly reduced.

  • Don’t Let Them Play the “Us Versus Them” Game.

Don’t fall into the mindset of Microsoft License Specialist or SAM Teams vs your Account Team and don’t let finger pointing back and forth get in the way of you getting a concession

  • Engage an Outside Expert Like MetrixData 360

MetrixData360 has the experience, know-how and proven ability to speak the language of the software vendor to represent your interest in the most effective way possible. We can ensure you do not overpay millions of dollars just to settle a Microsoft License Audit. Our goal is to make sure you only pay the vendors what you owe them.

We will also free up your time and resources. Let the MetrixData360 team of experts guide you to manage the audit process to achieve the best results, for you! For more information, check out our Software Audit Defense and Self Assessment.

Office 365 Decision Model – The Only Tool You Need

Office 365 is one of the first things our clients mention when they talk to us.  Its one of the top concerns or challenges that they have and one of the common things that we hear from them is that they are tired of purchasing software or services that they never use.  In the world of Office 365 not subscribing to this is a very difficult task based on how Microsoft creates Office 365 bundles and the way they price the product vs the service that they offer.

MetrixData360 has developed an Office 365 Decision Model for you to use to help you determine how best to approach Microsoft depending on three key factors:

  1. Your Unique Business Requirements as they relate to Office 365
  2. Your Actual deployment roadmap of the services (regardless of Office 365 licensing bundles)
  3. Costs of not just licensing but deployments, upgrades etc.

Office 365 Decision Model

Depending on where you intersect on this simple Venn Diagram will determine what you should do with regards to negotiating an agreement with Microsoft on Office 365.  If you fall into the following category (where the circles intersect), the following is our high-level guidance for you:

  1. Office365 costs more than your costs to maintain your current infrastructure. At this junction, you should delay your purchase of Office 365 as you will not have the financial business case and TCO to move forward with a deployment.
  2. You have not determined your roadmap and the timeframes within which you will deploy the components of Office 365. You should not proceed with a purchase of Office 365 (regardless of price) as the months that you do not use the product will cost you more than any savings you may have from pricing.
  3. You are unable to identify any solid business reason to move to Office 365. Deploying to the cloud would not provide the business or your IT organization any added benefit so there is no reason to move forward with a purchase of Office 365.
  4. You have all the requirements necessary to move forward with a negotiation. Go forward and negotiate your best deal with Microsoft.


How to Negotiate the Best Microsoft Cloud Deal

Microsoft is pushing you to move to their cloud offering yet Microsoft’s offering can be confusing. It’s more important than ever to understand how to efficiently negotiate a winning cloud deal.

Join Mike Austin as he shares his insights and cuts through the confusing jargon with straight talk! Mike Austin has been involved in countless Microsoft negotiations and audits and has negotiated over $1B in software cost reductions.

Free Azure Support – What’s the Catch?

If you have ever negotiated an Enterprise Agreement with Microsoft you will know that if you hear they are offering something for “Free”, it’s time to start budgeting for future costs.

Free Doesn’t Mean Free

That’s why when Microsoft recently announced that some customers will be offered a year of FREE Azure support, the first question that came to mind for us was “So, what’s the catch?” You know what they say about something that sounds too good to be true. So, what’s in it for Microsoft?

To take advantage of the free support offer, you’ll need to include Azure Services under an Enterprise Agreement (EA), purchase between May 1, 2016, and June 30, 2017. Or have an active EA during that period.

If you choose not to include support with your Enterprise Agreement, you’ll automatically qualify to receive Azure Standard support at no additional charge. Azure standard support usually carries a price of $300 USD per month. This level of support is recommended for those with “Limited business-critical dependence on Azure” and promises a two-hour response time. This is a seemingly great incentive for organizations looking to perhaps move a few workloads to the cloud but, not ready to move systems critical to business continuity.

If your organization has already made Azure commitments and decided to include standard support (purchased separately from your EA), Microsoft will be bumping you up to the Professional Direct level. Professional Direct support is touted as the “must-have” for those companies that have already made a major Azure commitment and most likely have or project to have a high level of dependence on Azure. Have you moved applications or workloads that are critical for day-to-day business operations? Professional Direct support is a big deal.  This support tier usually carries a $1000 USD monthly cost which includes one-hour response times and some included advisory services. For those who signed up for that level, you will get six “App Consulting Services Sessions” in which Microsoft folks will offer “customized one-on-one consultation with a technical expert on a variety of Azure-related topics, such as architecting cloud environments, design and implementation of apps on Azure, and workload deployment.”

Did you see what Microsoft just did there? By offering free support or increased levels of support to organizations at every level of the cloud adoption lifecycle Microsoft is enticing their EA customers to consume more.

For those who might have opted to include Azure in their Enterprise agreements with no intention to deploy but, perhaps received some other benefits or discounts elsewhere in their EA negotiation, they now have a support team to stand behind them as an incentive to just give Azure a try. Similarly, companies that have decided to test or move non-critical workloads to Azure can now move more and include systems with perceived higher risk to Azure feeling secure that they have access to the Top Tier of support should something go wrong. Finally, the inclusion of the App consulting services and customized one on one consultation for those companies that have already formed a dependence on Azure have just given Microsoft’s sales organization a reason to initiate discussions to help you consume more, spend more, become further dependent and entrenched.

There you have it. “The catch” you knew was there but, perhaps couldn’t quite put your finger on it. If your organization is in a position to receive this “free” support offering, by all means, take it and by all means, use it. Just keep in mind the true motives behind this promotion. It’s empowering Microsoft to push just a little bit harder. They will be telling you it’s okay to move forward with cloud initiatives just a little bit quicker. The end game however falls into their favor with rapidly increasing consumption and of course the monetary gains that will undoubtedly go with it.

This is a complex issue and our licensing experts would be happy to have a free consultation with you to see how we can help you.