Frequently Asked Questions About Software Asset Management

There might not be many kids who want to grow up to be experts in Software Asset Management and there’s a couple obvious reasons for that, namely because Software Asset Management (SAM) is so confusing. So today we are going to tackle some of the most frequently asked questions about Software Asset Management and concerns that we run into from our clients.

At Metrixdata360, we’ve had plenty of people come to us with the same questions for our software consultants over and over again, so we thought in this blog post, we’d share some of the most commonly asked questions, along with their answers.

How Much Money Can Software Asset Management Save Me? 

Software Asset Management can have a huge cost saving potential if the right effort is put in. According to CDW’s article 5 Ways Software Asset Management Reduces Costs Software Asset Management allows for your company to plan better, to optimize contract management, and to re-harvest software licenses to avoid penalties. SAM experts like MetrixData360 can shrink your compliance gap down to what you actually owe, and better data awareness will mean that large compliance gaps are less likely to happen in the future. Software Asset Management won’t provide you with over-night awareness and perfect coverage, but it can provide you those things in the long run. Software Asset Management is a journey, after all, and it will take time before you have a complete handle of your software profile and SAM experts like MetrixData360 can help you get there.

SAM will help you get better data awareness when it comes to your inventory, contracts, IT roadmap, etc. And so, it will also mean that when your contract is up for renewal, you’ll be meeting the software vendor on equal grounds. You won’t have to go into a negotiation feeling as if the vendor has better data on your organization than you do.

In the past the scales were tipped in the vendor’s favor; they had a better understanding of your data than you did and that gave them the upper hand in negotiations. If you don’t have full visibility into your data and you don’t know what your company needs, how will you know that you are overspending by 60% purchasing the bundles they want you to purchase? It is not uncommon for a vendor to offer a 20% discount but sell you 40% more than you need, negating the discount savings and costing you more than simply buying what is necessary at regular price.

So, while software asset management may seem to gather no immediate returns, it is a tremendous investment that can save you money in the long run. We estimate that on average most organizations are over-licensed by 60% but are under-licensed in other areas by 30% at the same time, with an accurate SAM program, that’s money that you can save.

We’re Too Busy for SAM!

One of the most frequent objections to a SAM program that we run into is “we’re too busy!” Unfortunately, software vendors don’t care how busy you are. In fact, if you’re too busy to maintain your SAM, you’re a prime audit target and vendors will see you as a potential cash cow. If you have a manual or multiple system, then you’ve surely faced the pain of having to try and understand what your requirements are. Trying to pull together an accurate inventory of a single software publisher in your environment, a seemingly simple task, can be so exhausting, frustrating, and ultimately fruitless if the data pulled from each source renders different results. But not making time for SAM leads to a messy environment with plenty of compliance gaps for auditors to exploit.

What people don’t understand about Software Asset Management is that by hiring a SAM expert all that pain is lessened and, if done right, over time it goes away completely. Your team may be asked to take 30 minutes to run a report and then the consultants will do the heavy data analysis. You only get involved again when the data doesn’t line up and needs to be refined. The rest of the process is handed off to us. To add some perspective, we have spent a year and a half working with one of our clients while their company faced a heavy software audit. During that year and a half, their team has put in less than forty hours of work pulling inventory data and answering questions while we took care of the rest.

Why is Software Licensing so Complicated?

Software licensing is quite difficult to understand. According to Seattle Pi’s article Why is Microsoft Licensing so Complicated? there are plenty of explanations that software vendors will give to account for that hyper complexity. For example: customer’s unique profiles and the ever-changing nature of technology could require constant and complicated updates to licensing.

Whatever the reason, if a vendor’s software is already highly integrated into your company, what are you going to do if the latest license changes add an extra 10% to your software spending? It’s not like you can just up and leave. It’s like having a restaurant where the guests are chained to their chairs. Licenses that are too complicated to understand and are subject to change, which only aggravates the imbalance in an already uneven relationship. Getting a handle on your software assets is where you can take back control.

What Value Can SAM Bring our Company When Only We Know our Systems? 

Perhaps you have industry specific software that only a handful of companies worldwide use, and it is tailored to serve the niche your company thrives in. If that is the case, then how can a software consultant possibly help? To this problem, we usually have a single response: what is the licensing metric that your vendors are using? The exact nature of the contract or vendor does not really matter, all that matters is the licensing metric and the software contract language that we’re dealing with.

The metric is what we can accurately report on, regardless of who the contract was written for or by. At the end of the day, we know understand how software contracts work, we understand licenses and we know how to count; those three skills are the critical skills that are needed to cut your software costs and lower your compliance gap during an audit.

What Does a Software Consultant Do?

Software Asset Management is a journey. SAM tool vendors will often sell themselves as being the end of your software troubles and you instantly have control over your data as soon as the tool is finished installing so you can promptly forget about it. That’s hardly the case. Depending on how far your company wants to get into software asset management, your SAM journey can take anywhere from 2-48 months.

MetrixData360 helps you along in this journey by developing SAM programs that are broken down into three tiers:

• Tier 1- Trustworthy Data:

During this stage, we’re most invested in getting you to the point where you know what you have so that you can effectively manage it. This includes having reasonable assurance about your software inventory and license-compliance.

• Tier 2- Life Cycle Integration:

Here we strive to achieve a greater efficiency and cost-effectiveness in your IT Asset Lifecycle. Utilizing things like roadmaps and support cycles to determine not only what you have but what you need in the future.

• Tier 3- Optimization:

The last stage is where you achieve greater efficiency and cost-effectiveness through cost-cutting focus. Imagine knowing exactly what you have and what you need in the future and utilizing the power of that information to beat your software vendor on your next contract renewal?

Of course, this is not a rigid course outline. If we are working to achieve the first tier, we will also be gathering data that will help achieve both the second and third tiers during the process. We can also adjust our approach based on your time frame, your team’s internal goals, and where you are positioned in your SAM journey. A good example is you may have a big Microsoft Enterprise Agreement that is coming up for renewal and you want to just mature your Microsoft processes to Tier 3 in order to win that negotiation: we can do that while working to mature the rest of your software estate over-time.

For more information on a Software Asset Manager compared to doing it yourself, visit our article Hire a Software Asset Management Expert or Do it Yourself? The Pros and Cons of Each.

We’ve Been Trying to do This Job Ourselves for Years, What Makes MetrixData360 Different?

This is the question we hear most often. Companies come to us feeling as though managing their software is just impossible and they wonder how we can give them different results. We’ve been doing this for seven years with 20-30 engagements each year and our licensing experts collectively have eighty years of experience on our side. We maintain our ambitious standards by following five key principles:

1. Transparency:

Because we understand the sensitivity of this engagement and the data involved in it, we maintain a policy of pure transparency in our methodology and the technology we use.

2. Fact-based:

Our findings are completely fact-driven and if the data is insufficient to draw any conclusions, then all assumptions will be highlighted for you, along with the ramifications of using those assumptions.

3. Collaborative:

Despite having a mature engagement process, we always seek to work with your existing processes and data availability to ensure increased engagement efficiency. >

4. Solution-Driven:

It’s important for us to highlight the risks and challenges in your software Licensing solution and portfolio, but we know it is even more important for us to support you in creating potential solutions to your unique challenges.

5. Articulation:

We know software licensing is complex and we will ensure that our findings and recommendations are well explained so you can act accordingly.

Methodology: We draw from multiple sources of data to give you a handle of your licensing. For instance, if we are trying to determine the number of users or devices you have, we might pull data from your Active Directory, SCCM, and/or your IT security tools (all of which could easily give you different numbers). Based on this data, we can figure out a strategy that best suits your needs based on the overlap of information. Often, we find that elements of the process that were a huge roadblock for client companies are really no problem for our tools and processes to overcome.

Our main concern is your timeframe. If your company is not in an audit, we’ll have a chance to chase down the data that you’re missing, but if you are in an audit and you’re pressed for time, we can accommodate, troubleshoot, and automate as much as possible to get accurate data quickly in order to ensure you pass the audit.

How Do I Start Getting My Software Assets Under Control?

Software Asset Management can be such an overwhelming task but if you want to get a handle on your software, start by looking at your contracts that are coming up for renewal – that’s always an opportunity if approached with the right data. Next look for the risks, see if there’s any outstanding issue that could crop up if you are audited later (e.g. if you know Oracle is poking around asking questions, go look at your Oracle environment before they do). These two places can act as starting points, and you can work out from there to address issues that might come up.

A lot of the time, we take inventory from an organization’s tools and put it into our internal SAM Tools. We are able to review our clients’ data and provide them with great starting points for implementing SAM and identifying immediate savings opportunities to provide some quick wins and ROI for a SAM program. Knowledge is your best defense against unfair contracts, costly audits, and inflated software expenses. Putting off knowing will only hurt your budget in the long run.

Having a strong understanding of software asset management shouldn’t be harder than finding the secrets of the universe. Clicking the button below will take you to a booking page, where you can get in contact with MetrixData 360 CEO Mike Austin, to launch your Software Asset Management process.

Schedule a SAM Meeting

4 Signs It’s Time to Hire a Software Asset Management Expert

Is it time for your organization to hire a Software Asset Management Expert? Software Asset Management (SAM) is the type of thing that is easy for IT organizations to forget. It’s like that mysterious plastic container at the back of the fridge that you haven’t opened in a while. Just like that unpleasant odor to let you know something in your fridge has gone bad, there are some ways you can tell when your software licenses and expenses may be on the cusp of causing you grief. Implementing a successful SAM program is difficult to do.  There are numerous skills required and multiple sources of data to go through and understand (software deployments, contracts, and hardware configurations). Feeling overwhelmed and frustrated in the wake of such a challenge is understandable but it can be avoidable with the right help at your disposal.

4 Reasons to Hire a Software Asset Management Expert

With nearly eighty years of combined consultation experience on our side, the Software Asset Managers at Metrixdata360 know exactly where a company needs help from the experts, and that’s what we’re here to share with you today. We’ll show you how you can tell what you can do yourself and when it’s time to bring in experts to assist.

1. Your Software Estate Is Growing Rapidly

Perhaps you once only had a few licenses to keep track of and the servers that your company needed could be counted on one hand. Now, to accommodate your company’s growth, you’ve had to buy another license, and another, and another, building a large and confusing IT architecture. Maybe your company has recently gone through a merger or acquisition and the transition has left you disorganized and unsure as to whose license belongs to who.

According to OMTCO’s article Six Questions that Managers Should Ask about Software Asset Management, if your software estate incorporates hundreds of servers with licenses from critical vendors like Oracle, IBM, or Microsoft, then it is time to consider having your software managed by a professional.

2. You’ve Purchased More Than One SAM Tool

Software Asset Management tools are a great way to keep your company organized. The problem with these tools is that it is hard to find one that can manage everything you need it to. While SAM tools offer many features, their primary function can be broken down into two parts: to conduct inventory and to manage your licenses.

The problem is that many SAM tools have difficulty accounting for the newest technological advances. Getting your SAM tool to read multiple different license metrics, for instance, can work as well as trying to shove a cassette tape into a CD player.

They can accidentally account for things twice, they can mark your test/ dev servers as full production, and they can fail to account for the information in your Active Directory, which is typically the first place the software auditors will look.

The way that companies accommodate for their SAM tools’ weaknesses is by either creating spreadsheets themselves (which renders the purchase of the SAM tool pointless, why get a product if you have to do its job for it?) or they get another SAM tool just to make up for the missing information.

If you find yourself having to compensate for your SAM tools, it might be time for a professional upgrade.

3. You’re Migrating to the Cloud

It seems like everyone is packing up and heading for the Cloud. Once you’re transitioned, you’ll have excellent flexibility, but the move can cause an equal amount of grief when it comes to your licenses and your software bills. Many companies assume that they can take their licenses to the Cloud with little issue, but that’s not always the case.

It’s important that you read your contracts carefully.

Some software publishers create programs that harbor sensitive information – such as clients’ credit card numbers or patient records – and so they will not let you move their software to the Cloud. It’s a huge liability for both you and them since the Cloud has been known to have major breaches in security. In 2018, for instance, some of the biggest breaches in the Cloud included the Aadhaar India National ID Database (1.1 billion Indian citizens had their information exposed), Facebook (50 million user accounts were compromised) and Marriott Starwood Hotels (the information of 500 million guests was compromised), according to Spinbackup’s article Top Cloud Data Breaches in 2018 Lessons Learned.   Even the vendors that do allow movement to the Cloud can charge you heavy fees for doing so.

In addition, unmonitored access to your new Cloud estate can leave your IT department to have the ability to spin up any Cloud instance they want, without proper regard to whether such an action is within compliance with your licenses or even before having a full understanding of what it will cost your company. It’s common with unmonitored access to the Cloud, that companies will spin up projects and then leave them on for months after the project’s completion, meaning they are still being paid and draining your IT Budget.

As we covered in the last section, because many SAM tools on the market were made long before the Cloud became popular, they struggle to monitor these types of scenarios, leaving companies with unknown expenses and compliance gaps. Having someone that can monitor your Cloud estate is essential to keeping the costs down to their lowest digit during this transition.   For more information about Cloud Migration, check out our article 5 Problems When Moving To the Cloud.

4. The Last SAM Review/ Software Audit Didn’t Go So Well

The sting of a poorly conducted software audit is a harsh one. Perhaps the auditors came in and took every grey area and every unknown factor and inflated your compliance gap until it was the size of your annual software budget. After all that wasted manpower and resources, if you were in a full legal audit, you might have been forced to foot the bill for the whole process and had to pay for the owed products at full price (your discounts aren’t available to you in a full audit).

You were caught off guard by the audit findings, you knew you couldn’t possibly owe that much but had no idea where to look to prove their Estimated License Position wrong. By the time you made it to the negotiation stage, you just wanted the process to be over, so you reluctantly agreed to their terms and now you never want to go through that again.

While a SAM professional can’t stop the software audits from coming back year after year, they can streamline the process, saving your own workforce resources. SAM professionals also can tell the difference between valuable data that is critical to the audit and wild goose chases the auditors will send your highest paid employees on. They know how to make it so that you are better prepared and more organized, which will leave your compliance gap cut down to the amount you actually owe.

Types of Software Asset Management Expert

Should you decide it is, indeed, time to hire a SAM expert, there are three options you have at your disposal.

In-House Software Asset Managers

Hiring someone who owns this project is a great way to ensure it is done with great care and passion. Software asset managers don’t just get your licenses in order for any upcoming audit, they can also help manage new software deployment and track their effectiveness in your company.

A good software asset manager is someone who has extensive knowledge of software, but who also demonstrates a strong understanding of finances, negotiations, legal matters, and business. A software asset manager is excellent for managing your company’s daily usage over a long period of time (either on-premise or in the Cloud).

Software Consultant Hybrid

As Rolling the SAM Dice: in-house vs. managed from the ITAM Review notes, a popular option that many businesses take advantage of is having a hybrid of the two options. They will often buy their own SAM tool but have an external team manage it, thus giving them control over their data and the methods used to monitor it, but they also can rest easy knowing that their assets are being well managed.

For More Information on Hiring a Software Asset Management Expert

Knowing when you need a Software Asset Management Expert could save you a lot of money – almost 30% of your current software expenses and that number only grows in the case of a software audit.

At Metrixdata360, we’re interested in finding you the best solution for your software asset management needs so you will be able to know exactly where your money is going and you’ll be ready with solid data at your disposal when the auditors come knocking. If you’d like to learn more about how Mextrixdata 360 can help, reach out to us with your questions or take a look at our SAM Compass service. We strive to respond by the end of the following business day to all inquiries.

Don’t Wait Until June To Negotiate with Microsoft

Waiting for June to Negotiate with Microsoft? Don’t Bother!

There is a piece of common wisdom that has been rolling through the Software Asset Management community for a while now: negotiate with Microsoft in June to strike better deals on your licensing contracts. Unfortunately, like most tall tales, it lives purely because it continues to be repeated without regard to data or evidence. In fact, after completing hundreds of Microsoft negotiation projects over nearly a decade and negotiating over $1 billion in license contracts, we can confidently tuck this myth away as little more than folk wisdom. So where did this myth come from? And why has it become so prevalent in the SAM industry? Let’s dig deep and dispel this myth once and for all.

June is Microsoft’s Fiscal End of Year

The myth that Microsoft is willing to give better deals stems from the fact that June is the end of Microsoft’s fiscal year. While many businesses try to shore up any negotiations to boost their end-of-year earnings, we assure you that Microsoft is well ahead of you. For a corporation as large as Microsoft, making a last-minute sale of even a few million dollars at a huge discount for the year-end doesn’t make sense on the scale that Microsoft plays at. They know you need their software or face a huge hassle when you try to move away from their products, as the scientists at CERN are currently finding. So why should they care whether you buy today or tomorrow? Microsoft knows they’ll get your money eventually.

Aside from the sales rep that wants to make his quota look good, the fiscal end-of-year for Microsoft does not change the margins they are willing to accept during a contract negotiation. Microsoft didn’t become the industry giant they are by painting themselves into a corner when negotiating. In fact, going into a negotiation with the assumption of being on a deadline is a great way to pay more. To quote Chris Voss in Never Split the Difference, “Deadlines are the Boogeyman of negotiation–almost exclusively self-inflicted figments of our imagination, unnecessarily unsettling us for no good reason.” By assuming you have a deadline of June 30th to close a deal, you’re robbing yourself of the best tool any negotiator has: TIME. In the end, Microsoft doesn’t care whether your contract gets put on the books for this year or next, they just want your money.

Microsoft Made $118 Billion Last Year

Let me say that again for those in the back: Microsoft took in over $118 Billion last year. To give you a sense of scale, consider that a $1 Million dollar license contract is less than 1/100,000th of their total revenue. Even signing a $10 million contract would be less than 1% of 1% of their total revenue. For many organizations, a million-dollar deal either is a huge expense or a boon, depending on what side of the contract they are on; for a company like Microsoft, it’s pocket change. Those looking to craft a deal under the pretense of boosting Microsoft’s end-of-year bottom line fail to realize where they sit on the scale of a company like Microsoft. The truth is your contract is a drop in the ocean of Microsoft’s revenue. That doesn’t mean that Microsoft isn’t willing to sit down and talk, however. Making a dollar is still better than not making a dollar, as Economists like to say.

Software Publisher Revenue 2017-2019 Statista
Software Publisher Revenue, 2017-2019.

A Drop in Microsoft’s Bucket

Now that we’ve established how little your contract contributes to Microsoft’s bottom line, it’s time to shift your thinking when you go into a negotiation. There’s a good chance your company is not as big a fish they want to negotiate as. When it comes to bringing clout to the table, there are not a lot of players that can shake Microsoft. And that’s okay. Now that you know your agreement won’t have debilitating effects on Microsoft’s bank account, it may seem that you’ve lost your leverage. But you haven’t. Instead, you are now in a better position to negotiate because you understand the reality of the situation. Negotiating from a false position is reckless at best and could end up sabotaging your own efforts.

When IS the Best Time to Negotiate with Microsoft?

Unfortunately for those looking for the best time to enter into talks with Microsoft, the answer isn’t found on a calendar. The best deals are made through good negotiations and a solid understanding of both parties’ positions. When it comes to negotiating with Microsoft, there are a few tips and tricks you can use to get a better deal.

Have Accurate License Inventory

The easiest way to be sure that you don’t give Microsoft more money than you need to is by maintaining an accurate list of your license inventory and use. This data will guide you in how many licenses you need, the type of software your organization needs, and give you leverage when you enter negotiations.

Don’t be Intimidated by Microsoft

A second tip is to stand your ground. It is easy to be intimidated once talks with Microsoft begin. Microsoft is one of the biggest dogs in the park, and all that clout can be intimidating. The truth, however, is that a good negotiation is one that both parties walk away feeling satisfied with. By knowing what you want, why your position makes sense, and sticking to that position, you have a better chance at striking a deal that works for both parties.

Hire a Professional Contract Negotiator

For those who still don’t feel comfortable going toe-to-toe with the biggest player in the software industry, hiring a professional negotiator can be a reasonable solution. Negotiators in this realm often know Microsoft’s negotiating tactics and limits. By hiring a third-party provider who understands how Microsoft as a company thinks, your team can effectively counter Microsoft’s tactics and/or be better prepared for how they will react to your offers.

Facing a negotiation with Microsoft can be stressful. Let MetrixData 360 relieve some of that stress by preparing you for dealing with vendors through our Learning Center. If you still have doubts about your organization’s ability to negotiate the best possible license contract, contact us and let our expert software license negotiators handle it for you.

5 Secrets to Prepare for a Software Audit (And Save Money)

Not Sure How to Prepare for a Software Audit?

Software costs for most companies are already sky-high, leaving the Finance team frustrated and IT departments stuck trying to stretch their budgets to near impossible lengths. Asking your team to prepare for a software audit may seem like trying to bleed a stone, but being unprepared will be far more costly. Audits are an unpleasant inevitability for businesses – it’s not a question of if but when.  At Metrixdata360, it’s our goal to save you money, so here are some ways to limit the financial damage of a software audit and bring your compliance gap down to what you actually owe.

1. Prepare to Prepare for a Software Audit

Is there such a thing as too much preparation? Maybe… but not when it comes to your software licensing! If your software vendors have their way, audits would happen fast. Vendors know that tight, audit turn-around timelines will leave you scrambling to gather all the data you need to prove your compliance; and if your data has gaps or grey areas, the auditors can make worst-case scenario assumptions to inflate your possible compliance gap.

According to Glasshouse Systems’ article How to Save Time and Money with Software Audit Defense, one of the best ways to save valuable time is understanding your licensing position and having the data organized and easy to prove long before you receive your audit notice. Remember, there is nothing motivating the auditors to do an effective job capturing your license position; any mistakes they make will be your pain and potential penalty to deal with. Having your own license position and your data at the ready should your company be called to the front for an audit, will not only improve your chances that your compliance gap will be lower, but it will also decrease the likelihood of being audited again in the near future. While some software vendors perform random audits regularly, auditors will also target clients that they believe have overly complex environments without the means to monitor them. Demonstrating a lack of preparedness during a software audit is like being that one antelope in the herd with a limp in their run; don’t assume the lions won’t notice. For further information about how best to prepare for a software audit, please visit our Software Audit Preparation article.

2. Common IT Failure – Have Proof of Ownership Ready

According to Scott IP Technology Attorneys’ article Common Mistakes in Software Audits, one common mistake that companies fall prey to during a software audit is providing improper documentation that fails to accurately prove ownership for software licenses. As soon as an audit notice is received, some companies try to buy more licenses in order to mitigate compliance risk due to a potential shortfall in licenses for their workforce/environment. However, this route is a waste of time and money, since trade associations and publishers will only accept dated proof of purchase with the entire name of the company on the document. Companies should seek consultation before they try to purchase licenses during an audit in order to understand the potential consequences and benefits of this action.

3. Get a Proper SAM Tool

Having a proper SAM tool will be extremely valuable for budgeting your software. An effective SAM tool can not only highlight where the shortfalls in your license spending exist but also where you are overspending on licenses (something that tends to get glossed over by the software auditors). A SAM tool can also provide the accuracy of data to show you where your licenses are being used and where licensing could be re-bundled to save you money. Make sure that your SAM tool can accommodate multiple licensing metrics and can account for any programs you’ve moved to the Cloud. That way you will have a firm grasp of your licensing position before you are thrust into an audit.

SAM tools are also very useful in the event of a software audit. During an audit, the software vendor will hire a third-party auditor that will come to the table with their own SAM tools that they want to use to measure your data. Whatever you do, don’t let them! Having a different SAM tool come into your environment is a quick way to have your compliance gap inflated. The auditor’s SAM tool will have its own way to measure licenses with the possibility of accidentally applying duplicates and marking your test and development servers as full production (plenty of SAM tools do this by mistake, so make sure that you’re aware of this when buying your own SAM tool). Having your own reputable SAM tool to gather data is the best way to counter the auditor’s offer of using theirs. For more information on SAM tools, please visit our SAM as a Service article.

4. Monitor Your Usage – Even in the Cloud, and Do it Constantly

Software Asset Management really shouldn’t be a thing you only do once a year or when the auditors are walking through your front door. It needs to occur on a regular basis – ideally, it should happen at the very least once a month, if not daily. That way you will know immediately if anything is amiss and your team can save time and money proactively fixing it instead of reactively paying penalties following a software audit. Now that many companies have moved (or are in the planning-to-move process) to the Cloud, one trend we are noticing is that by NOT regularly monitoring access and usage to the company’s Cloud environment certainly results in the spikes in a company’s spending.

With the ability for anyone in IT to spin up as many instances in the Cloud as they want, you run the risk of having projects left open and running long after the project’s completion, resulting in a continuous and unnecessary drain on your IT budget and expense to your company. You will also want to make sure that you have the right to move your licenses to the Cloud in the first place, as often licenses will be non-transferable. The Cloud has its own license metric that will usually leave a few of your servers exposed and unlicensed. For more information on proper Cloud Migration, please visit our article Heading to the Cloud? 5 Problems You’ll Need to Address.

5. Hire the Right Software Asset Management (SAM) People for the Job

Hiring the right people will get you the results you need. It’s a great idea to have an audit defense team ready and they should include members of your procurement and IT departments. Leading the project should be an audit-experienced attorney who knows how much and how little to say to the vendor and their auditors. In our many years of software licensing consulting, we have had many clients ask us whether it is better to hire a SAM consultant or to do it themselves. We’d recommend hiring a consultant because they offer you years of expertise instantly and they can streamline the auditing process to save your company precious time and resources. For a more in-depth look at hiring a SAM professional as opposed to doing it yourself, check out our article Hire a Software Asset Management Expert or Do it Yourself? The Pros and Cons of Each.

Invest in Being Prepared for a Software Audit and Save Money

Software Audits don’t have to be a complete drain on your resources, time and budgets. Following these tips and ensuring that you’re ready long before the audit arrives, can save your business time, stress and money. When you prepare for a software audit, you are investing in your IT department.

If you’d like more tips on how to be prepared for an audit, please check out our Learning Center for more information.

What Is Software Asset Management?

According to Wikipedia: “Software asset management (SAM) is a business practice that involves managing and optimizing the purchase, deployment, maintenance, utilization, and disposal of software applications within an organization.” But what does that really mean or look like in a practical sense? Software Asset Management is a vital process in any organization. Understanding how much software you own, which vendors you buy from, terms and conditions of the contracts you’ve signed with these vendors, program limitations, license entitlements and use rights, user needs vs. license installment, and accuracy of inventory are all essential functions of SAM.

For many organizations, SAM is a complex, unwieldy challenge, especially if the organization spans more than one location. Executing an effective SAM program is very difficult for most companies. A good Software Asset Management strategy is key to maintaining compliance and avoiding hefty true-up fees and other noncompliance costs. Companies who are found to be non-compliant with their licensing agreements can face massive fines, sometimes into the millions of dollars, or be subject to legal action.

What Are Software Licenses?

Software licenses are the agreements that allow a company or individual to use proprietary software owned by a vendor. Software License agreements dictate how and where businesses can deploy software, ranging from the operating systems on each computer throughout the organization, to the workplace software used on each machine/device, but may also include database servers and other back-end infrastructure. The licenses also address what sorts of tasks can be performed with the software, how the software is configured, and which features the organization is approved to use.

Staying in Compliance

Companies need to ensure that they purchase an appropriate number of licenses for either the number of devices the software will be installed and used on or; for the number of people who will be using the software. Historically, we’ve seen two main ways that many companies rely on to try to mitigate their risk around compliance with their licensing:(1) choosing to over-license (aka: “better safe than sorry”) practice or; (2) budgeting year-long for eventual true-ups. Being out of compliance can result in the publisher of the software performing a Software Audit, which can result in massive fees for companies found to be missing licenses, plus the added disruption of having your software environment audited.


Over-licensing occurs when an organization purchases more licenses than they need for their environment. While this ensures that the organization will be compliant, the overspending of purchasing more licenses than required is a costly practice, especially when you consider that the licenses won’t be used. A solid SAM strategy will help to ensure that your company does not overpay in the long run by maintaining only the number of licenses necessary.


If a software publisher finds that you are out of compliance, a true-up will be necessary to settle the difference. Depending on the scale of non-compliance, true-ups can cost companies hundreds of thousands or even millions of dollars. Accurate inventory count, proper maintenance, and regular assessment of software asset requirements and use ensures that true-up costs don’t creep up on you too significantly and can help keep auditors at bay.

Contract Re-negotiation

Part of having a strong Software Asset Management strategy is understanding how to re-negotiate license contracts. At the end of your software license contract term, you will be given the opportunity to re-negotiate with the vendor. When an organization enters into these negotiations with a current view of their software needs and use and a projected view of their future requirements, that information can be leveraged for better pricing and can help avoid unnecessary over-purchasing of new or unneeded licenses.

Maintaining Compliance

Staying in compliance may seem like a daunting task, but a strong Software Asset Management strategy can make compliance a much more manageable process. It may seem like the most prudent way to avoid true-up costs or an audit by a vendor would be to purchase more licenses than you need, but this comes with its own costs, especially over the long-term. Unless the organization is in a growth cycle where more employees will be brought on to consume those licenses before the next purchasing cycle, the money spent on over-purchasing licenses is wasted.

A good practice to assist in maintaining compliance should include performing a Self-Assessment at least once a year. An organization is in its best position to make software license decisions when they have a full picture of their software environment.

For more information about Software Asset Management as a whole, or any inquiries about Self-Assessments, we invite you to contact us with your questions.

4 Best Practices For Cloud Optimization

4 Cloud Optimization Best Practices

Are you ready for your Cloud Migration? Moving to the Cloud is an exciting event for any company but it can be a headache if done incorrectly. Throughout our seven years in software asset management business, we’ve seen companies who have had their software costs escalate to staggering numbers during and after their Cloud migration. At Metrixdata360, we want to make sure you get the most out of your software environment, so to make sure your transition is easy, cost-effective, and stays that way as you settle into your new software estate, here are four tips you can implement for you own cloud optimization.

1. Get Ready to Move to the Cloud

Before your company comes to the decision to go to the Cloud, make sure that you are well prepared for the task at hand. According to Microsoft Azure’s How to optimize your cloud investment with Azure Cost Management, make sure you have a clear outline of what problem you aim to solve when heading to the Cloud, and make sure that moving to the Cloud is the best decision for your company.

Get everyone on board with the Cloud move, which includes making sure the Financial and IT departments are on the same page and have systems in place that can account for both cost and visibility. If you have a Software Asset Manager or Team, make sure that they are ready for the transition, as a large part of their job will be moving with the Cloud migration. Estimate how long you want your company to be on the Cloud and find a billing model that can suit your needs (there are short term estates offered by Microsoft Azure for free).

Before the days of the Cloud, companies would have to buy physical on-premise hardware that would come with a fixed amount of space and that remains the mindset of companies as they move to the Cloud. Often, they will overbuy on space in order to accommodate anticipated growth which made sense when you were dealing with a fixed asset.

Cloud, however, works more like a subscription and can be altered to fit your company’s needs on a monthly basis. Does your company have a busy season where you will need more space compared to the rest of the year? Does your company virtually shut down on the weekends? You can arrange to have your Cloud estate reflect such needs easily.

For a more in-depth look at problems your company is exposed to during your move to the Cloud, see our blog post 5 Problems When Moving to the Cloud.

2. Check Your Software Licenses

Many companies head for the Cloud thinking that they can take their software licenses with them and they are not completely wrong. Some publishers let you take their applications to the Cloud, but others distinctly do not and it’s important to know who is who. This is where Cloud optimization begins to shine and show its value.

Think about applications that might carry sensitive information like credit card numbers or patient records and it’s likely that the vendors of those applications will be unwilling to let you take their licensed software to the Cloud for security reasons.

The licensing metric changes as well once you enter the Cloud and it’s typically the case that a license, once moved to the Cloud, will not go as far to cover as many servers as it once did when it was on-premise. This will leave you with a few unlicensed servers suddenly on your hands after the transition is finished. Make sure you take extra care to understand your licenses and if moving to the Cloud is even possible without finding yourself in breach of your contracts or with a staggering compliance gap.

3. Calculate Your Cloud Costs

One thing that is also important to do before you’ve even started the Cloud transition is have a budget set in place. How to Optimize Your Cloud Investment with Azure Cost Management from Microsoft Azure points out that the Azure calculator is one available tool at your disposal that can calculate how much any combination of Azure’s services will cost. With a budget set in place to limit your IT’s spending and you can know where your money is going.

SAM tools have traditionally been an excellent way of tracking your software spending but you must ensure that your SAM tools are equipped to handle Cloud-based data, since many SAM tools struggle to work with something as new as Cloud. With a budget set in place and the right SAM tools that can monitor those changes, you will also be able to detect where you are overspending so that you will be able to re-bundle those resources to where they will actually be useful.

4. Ensure Visibility and Accountability

One of the biggest issues we’ve seen during a company’s Cloud transition is being unable to keep track of assets. Giving Cloud access to your whole IT department to spin up as many instances as they want can leave you with virtual sprawl and instances that are forgotten while they drain your software budget.

Set an infrastructure in place that can regulate who has permission to spin up instances and make sure that projects are completely decommissioned after they have concluded. In addition to monitoring usage, set a well-informed software budget and investigate if prices have unexpectedly spiked beyond your predetermined price.

2 Models for Optimizing Cloud Cost from BMC Blogs offers two types of solutions for IT departments to manage their Cloud estates. The first model depends on the IT department checking their tools daily and from there perform a series of cost saving tasks.

The model asks that IT members express constant awareness of resources, analyze those resources and from there, optimize the company’s spending with the information that they have. The second model offers a cycle that needs to be performed on a monthly or bi-monthly basis. This cycle focuses on aging, idle and inactive material.

If you are prepared for what to expect, moving to the Cloud can be a satisfying experience that can improve the flexibility of your company and better protect your data from being lost. These four practices will get you ready for your Cloud Transition and more importantly, they will make sure that your software budget doesn’t start spiking the moment you hit the Cloud. If you’re ready to improve your Cloud Optimization, continue onto our Learning Center to learn more about the Cloud.