Month: May 2020

How to Save Money on Your Software Licensing

There are plenty of things that can be unpleasant about a work week: that annoying coworker, that difficult proposal, bumper to bumper traffic, and chances are that an unpleasant software audit is also thrown into the mix. However, it’s easy to ask why software audits are so necessary; can’t the software vendor just trust your company to be an honest paying customer? You’re already giving them so much of your IT budget and yet, it seems they keep on coming back for more.

At MetrixData 360, we’ve put a lot of time and effort into understanding the auditors and the software vendors who hire them. So today we’re going to discuss what’s going on in the minds of the ones who send out software audits.

Reason #1: Software Vendors Like Making Money

Software audits are big investments that publishers are putting time and resources into. If you are found out of compliance in a software audit, not only will you have to pay for the missing licenses, you will also have to cover the auditing process, which will include compensating the third-party auditors. Your licenses must be purchased at full price, not at your contractual or historical discounted rate, and, in the case of a Microsoft audit, you will also have to pay an additional 5% penalty fee. A poorly conducted software audit could eat an IT department’s annual budget.

For the software vendors this is an effective means of generating revenue because your options are paying out the auditing penalties year after year or finding a different software vendor to support your company’s IT infrastructure. If your software vendor views your software audit as an investment, it would be logical to assume they would prefer safe investments, the type that are certain to yield a profit.

You can therefore lower your risk of incurring a software audit by making yourself appear like a less profitable target. Being prepared is the best defense against audits.

Reason #2: Compliance Audits Mean Software Sales

Not only should software audits be seen as investments, they are also viewed by the software vendors as sales opportunities. Infoworld’s article, Software Audits: How High Tech Plays Hardball, states that software audits usually end the same way, with the customer handing over cash either to pay for missing licenses or to strike up a new deal with the software vendors.

Vendors go into audits to find mistakes, to strike fear into the hearts of their clients, and just when the sweat has glistened the top of the client’s brow, they offer a deal, then the vicious cycle continues. It is important to not rely solely on the advice of the vendor’s sales rep because they will not be interested in ensuring you spend wisely, just that your spending continues to increase.

The sales department of these software vendors have quotas to meet and they will always push their customers to spend more with them. They are trying to drive up their company’s stock, price after all. When your license is up for renewal, this is the sales rep’s chance to offer better maintenance and better products, not necessarily because it can benefit your company in a substantial way but because it was what they were told to sell. However, if you manage to keep your spending with the vendor what it is, or if you manage to even lower your spending with the vendor, then the sale’s team has a problem because now their quota wasn’t met. How else are they going to squeeze that extra cash from you? Simple, the company will send an audit notification and the vendor’s sales team will practice looking surprised in case you ever mention it to them.

Reason #3: Software Licensing Complexity Plays to the Vendor’s Advantage

There are plenty of reasons that software vendors give to explain the over complication of licensing. According to Softchoice, constant updates to technology means that there needs to be constant license updates to accommodate for those changes. A client may also require unique contracts with licensing specifically tailored to their demands, which makes for a complicated licensing system.

While these points may be true, software vendors do very little to remedy this confusion. In 2009, according to PCworld, then-Microsoft CEO Steve Ballmer stated that there could be no simplification of licenses expected in the near future.

Having a license for a piece of software doesn’t mean that you own it, it means you’re being granted the ability to use it. Software contracts are unique compared to other types of intellectual property since they can be written to include virtually as many agreements as both parties are willing to sign onto. Contracts are still written by the software vendor’s rules. In fact, the language the software publishers use to write up their licensing agreements is vague enough to make it difficult to understand and tempting to skip over.

However, if you don’t have a full understanding of the rules, how are you supposed to follow them? How are you supposed to work the rules to your advantage if they keep changing? You can’t, and that inability to know all the rules, let alone follow them, is the idea. Software Vendors perform audits the same way you would make your rounds checking the mouse traps in your house to see if any of them have been sprung.

Reason #4: Software Audits Aren’t Meant to Save You Money

Software audits or SAM reviews can be presented in a friendly way, as though it is an opportunity to check that products are being used properly and effectively. However, during a software audit, the third-party auditors will take the data from your software estate and come up with their own estimated licensing position.

It’s important to ask why were they hired? They were hired to find your compliance gaps and might even be paid based on how big a compliance gap they can find. There’s nothing to incentivize the auditors to scrutinize the accuracy of their findings.

If there are grey areas, if there’s room to make assumptions in your profile, they’ll always assume that the most expensive case is the reality, and if they’re wrong, then it’s so much the better for them. The only way you can gain an accurate depiction of your data and know what you actually owe the software vendors is by gathering trustworthy data yourself in order to challenge the software auditor’s findings.

The only way you can have trustworthy data at the ready is by having a strong software asset management system already in place long before the auditors arrive. The auditors will also fail to provide you with any information that indicates where you are overspending because that’s not what they were hired for. Even if there are areas where you could save money with the vendor, even if there are ways you could maximize the efficiency of how the software is utilized, those won’t be the talking points during an audit.

MetrixData 360 Makes Software Compliance Easy

Software audits happen; it’s an unfortunate truth that businesses must live with. With software audits only happening more frequently, it’s not a matter of if your business will be audited, but when. It’s important that you have a system in place that can accurately capture your data, which is where software asset management comes in. At MetrixData 360, we know how the software vendors think, and we know how to defend our client’s time and resources throughout the process. By clicking the link below you can head over to our Audit Defense page, where you can learn more about how MetrixData 360 can help you through a software audit.

Software asset management, especially when you are just starting out in your SAM journey, can easily prove an overwhelming, exhausting, and discouraging experience. It can be a laborious headache if you take the wrong approach to it, but it doesn’t necessarily have to be this way – there are things you can do to make software asset management a little easier. At MetrixData 360, our job is to make your job easier regarding your software licensing environment, so today we’ll be discussing ways to work smarter and not harder on your SAM program.

Don’t Set Unrealistic Expectations

One of the greatest pitfalls for someone just starting out with software asset management is getting too overwhelmed too quickly. Peeking into your software environment is enough to reveal an endless number of tasks and potential problems you now have to fix. For many companies, they feel it’s better not to look and hope the problem will sort itself out eventually.

While sticking your head in the sand is not an effective way to tackle software asset management, neither is trying to do everything at once. There are varying levels to SAM maturity, each with their own goals and objectives.

It may not be necessary for you to achieve the highest level of SAM based on what your company is hoping to get out of it, and it’s important to remember that 100% visibility and 100% accuracy will be next to impossible with enterprise-level software environments. 70%-80% would be a more realistic and attainable goal.

Communicate with Staff

Companies are made up of a lot of different people and very few of them will probably take deep enjoyment out of hearing about software asset management, but it’s important that staff are all on the same page with software, especially when it comes to the following pain points.

Comers, Movers, and Leavers

Companies are full of many moving parts; new hires coming in, employees moving from one department to another, and retiring employees all pose the question of what happens to their software licenses? Not having a strong process in place could mean accidentally having to pay for duplicated licenses or active ‘shelfware’ that your company is still paying for even though no one has used it in ages. Where do new hires go to get their new desktops? Where do retirees take their desktops when they’re done? Do people take their licenses with them to new departments? If not, what do you do with them afterward? Making sure that people understand these processes is critical to the success of your software asset management.

Shadow IT

Not knowing what people are downloading can become a serious issue for companies. Especially when seemingly free versions of things become less free when introduced to a corporate setting. An example of this can be seen in our article, The Invisible Risk of Oracle VirtualBox, where Oracle has ended up auditing clients based on their use of the seemingly free application VirtualBox. While it may be impossible and impractical to monitor everyone’s access to every website, especially given that forcing employees to seek permission every time they download free software might bog down productivity, it is nevertheless important to make staff aware of the risk of downloading certain products off of the Internet.

A Single Tool Won’t Save You

The last thing you want to do is put too much faith in your inventory tool. While inventory tools are essential to modern software asset management (unless you’d care to be driven to insanity counting your licenses manually), your job with software asset management is not finished when the tool is done installing. A single tool has the potential to increase your visibility by only 20%. It’s only after the installation of additional SAM tools, and their proper management and upkeep, that companies reach that 70%-80% visibility range.

Be Careful When Buying Bundled Packages

Buying a bunch of software in bundles may seem like it would be more convenient but when trying to organize these bundles, you’ll find that things can become quite a challenge. For one thing, SAM tools are often confused by bundled packages and it could fail to accurately document the bundled software, leaving you with a blind spot in your software asset management that you’ll eventually have to fix, either now or later when you’re in the middle of an audit. It also creates issues because bundles do not always come with sufficient proof of purchase receipts, which are imperative for success in any copyright infringement claims.

Moving to the Cloud also can pose challenges if done incorrectly. We have seen that there is often a spike in software cost when businesses transition to the Cloud due to staff given free rein to spin up Cloud instances, leave projects running, or simply buying more than they need.

It is important to be aware of these issues and the expensive headaches they can cause if your company heads to the Cloud thoughtlessly.

Moving to the Cloud Comes With its Own Challenges

Have a Software Audit Process in Place

The sad reality is that software audits do happen and so it is important to have a standard procedure in place in case one occurs. Instead of panicking, have a series of response emails ready to pick from, have a strategy prepared and in place, and know exactly what to expect out from a software audit. This will keep you from scrambling to get your data and responses together. At MetrixData 360, we’ve designed a Software Audit Defense Process, which can provide you and your company with the insights they need to create a strong, effective software audit procedure.

SAM Makes Everything IT Related Easier

From IT Staff and Security to Procurement, having a strong software asset management process implemented throughout your company will make the lives of your staff easier. IT Security will have a cleaned up, streamlined, and complete picture of the software environment that they monitor. Procurement will have full confidence in knowing what they need to purchase and whether there are licenses that already exist in their software licensing environment that can be recycled. With SAM, the CFO will not have to crunch the numbers to come up with the cash for a massive audit penalty, instead they can harvest saving opportunities for the betterment of the IT department. The IT department will have the data they need to effectively advocate for needed software. While this isn’t necessarily a point in how to make your Software Asset Management challenge a little easier, it does demonstrate how much easier everything else can become when SAM is properly implemented.

Want Easy Software Asset Management? Call MetrixData 360

Software Asset Management is far from an easy task, and it can quickly become complicated and overwhelm you if you try to jump headfirst without looking. However, there are ways to limit this confusion and make your life (and the lives of your IT Staff) that much easier.

At MetrixData 360, we pride ourselves in making your software asset management easier by taking care of the heavy lifting for you. We have had clients with year-long audits who barely put in a few hours of work, and we’ve provided clients with reports on their software environment that would have taken weeks to collect, with barely an hour’s work on their part. The rest of the work was left to us, the SAM experts. If you would like help on your software asset management, you can contact us today and get connected with our Director of Client Success for more information.

SAM After COVID-19

Right now, it may seem like there’s no end to this COVID-19 madness, but with small glimmers of light at the end of this dark tunnel fast approaching, it’s important to consider what the other side of this pandemic will look like for businesses. According to Research and Market’s book, Software Asset Management – Market Analysis, Trends, and Forecasts, Software Asset Management was expected to grow by USD$2.1 billion worldwide, although that was before the world turned upside-down. While these exact numbers may no longer be the case, in a pandemic, software asset management is still expected to become a major asset for companies wishing to drive down their software costs.

At MetrixData 360, we’ve been demonstrating our knowledge as software asset management experts for seven years now, and we thought we’d share how we expect the software world to change once COVID-19 comes to an end.

For the Short Term

Welcome to the Cloud

Businesses were already packing up and moving to the Cloud to take advantage of the flexibility and the freeing up of resources it provides even before the pandemic struck. However, when COVID-19 swept the global stage, companies either had to figure out a way to keep their employees working remotely, file as an essential service, or essentially shut down. This has left companies scrambling to get into the online Cloud business quickly – on both sides of the aisle. Video Conferencing Channels are booming, Zoom for instance has received more downloads of their product in these past few months than they saw during all of 2019.

With employees still meeting targets at home even without checking in at the office, it offers a great argument for remote work, that you don’t necessarily have to clock your employees’ productivity by the number of hours they sit at their desk. Remote work could very easily pick up in popularity, which raises the question – are you ready for the Cloud?

There can be issues with moving to the Cloud, especially when the transition is rushed. Such issues like improperly sized instances and licensing metric changes can cause an unexpected spike in costs.

What this means for SAM is that monitoring Cloud usage and spending will become a bigger priority as COVID-19 continues into the summer.

At the SAM Summit in Chicago, presenters pointed out that most companies see 35% of wastage when it comes to their Cloud profile. Getting such unneeded spending under control should be the priority for many companies in the upcoming months. This wastage comes from the complexity and variety of Cloud pricing models, the lack of control over provisioning, and the constant stream of system updates.

The Short-Lived Generosity of Software Vendors

In this turbulent time, the software vendors have offered generous packages to help businesses adjust to the pandemic. Microsoft announced Teams will be available to everyone for six months, an E1 license available to businesses, and an A1 license for those in academia. These licenses are the minimum level you need to access Teams. Likewise, Adobe has also announced that it will allow students and teachers temporary free access to the Creative Cloud until either the schools reopen or until May 31, 2020.

A Rise in Software Audits

We have all faced some difficulty with COVID-19, and the software vendors are no exception. They’ll be eager to make up for the lost revenue that they experienced while businesses were shut down or weathering the pandemic’s storm. So, we can expect to see an increase in software audits as soon as this crisis is over, if not before. We have already had customers come to us with an audit notice from a software vendor, wondering how they will ever get the information that’s required if they can’t even go to the office!

It’s important that your company is ready, despite the circumstances. Make sure that even seemingly free software is not installed without your knowledge, and be sure you understand whether or not your licenses can be placed on personal devices for remote work. Ignoring these issues now can easily lead to huge problems later.

For the Long-Term

Software Asset Management Tool Dissatisfaction is on the Rise

This is true, regardless of COVID-19, Smarter with Gartner points out that satisfied customers for SAM tools will only sit at 25% this year, with most SAM customers finding that the product fails to meet expectations. The reason for this can be found in the ever-increasing complexity of SAM, especially with the Cloud coming along to muddy the waters further.

SAM tools also have their limitations, as we discuss in our article, Why Do Software Asset Management Tools Stink at Software Asset Management? Some of the limitations of SAM tools include:

These shortcomings that appear in SAM tools will force businesses to either compensate by buying another SAM tool or take up the work themselves by creating spreadsheets and manually counting, which will be increasingly difficult as the pandemic carries on and more impractical as IT infrastructure grows more complex.

API Transactions

What we think will take place in the rest of the year and into 2021, according to our professional opinion at MetrixData 360, is that there will be a surge in microtransactions through APIs. “Microtransaction” is currently only a term used to describe any additional purchases that occur inside a video game, such as paying real money for additional weapons or resources. It can be frustrating for players who have already purchased the game, especially when the additional purchases become necessary as a way to advance through the game (pay-to-win scenarios), and it may become a term that frustrates IT departments in the workplace as well in the coming months.

Few people understand what APIs are or the key role they serve within a company’s IT infrastructure. APIs basically act as messengers between different applications. Applications themselves don’t talk to one another and their interaction is dependent either on some poor intern writing the same information repeatedly in each application, or the APIs doing it.

APIs, therefore, are imperative for the functioning of business, and we think that software vendors are going to begin charging businesses for the use of their APIs. For instance, two years ago, Salesforce purchased Mulesoft, which manages APIs, and is now offering businesses the use of Mulesoft’s technology to connect their applications to one another.

We have already begun seeing it as our clients rack up massive bills because their vendors have begun to charge them a seemingly small fee every time that APIs are used. In the same way that gamers can become frustrated when they are forced to whip out their credit cards for every level they advance, so too will such constant minor charges cause a headache for software asset managers.

Currently, there is no sufficient way to monitor API usage, and if there is no way to know how much you are using, you cannot accurately determine if you are being charged in a manner that reflects what you actually owe.

A New Way to Conduct Software Asset Management

Despite the hardship and tragedy of COVID-19, we will get through this, and it’s important that we work together while the economy recovers. Great tech doesn’t solve a people problem; the new age must be powered by people who are on board with IT investments and willing to gain control of their software environment before such disorganization leaves them exposed to software audits and wasted spending. At MetrixData 360, we pride ourselves in being educators so that our clients understand what we are doing and will be able to improve their SAM practices even after our engagement has closed, providing them with long-lasting value.

If you’d like to learn how you can cut your software expenses down during a Crisis, you can check out our article, How Will Your Software Contracts Be Affected By COVID-19?

How Software Asset Management Can Help Your Vendor Relationship

There are many advantages to software asset management; it can provide you with valuable cost-saving opportunities, and it can make sure that your software environment is both legally sound and safe from security threats. However, many companies hesitate to adopt software asset management solutions because they are afraid it will create tension in their software vendor relationship. They would rather nod their way through a software audit than challenge any of the software vendor’s findings, and they’d rather sign any deal that is offered to them as opposed to going toe-to-toe in negotiations.

The last thing you want to do is make your software vendor angry with you, especially when their software critical to your business. However, software asset management can easily provide benefits to the software vendor as well and can improve your relationship with them. At MetrixData 360, we know all about the relationship between vendor and client and how delicate that relationship can be. We have successfully navigated these treacherous waters for many years, and we have seen companies who implement software asset management and achieve a mutually beneficial relationship with their vendor along the way.

Software Audit Prevention

While software audits are performed by software companies, this doesn’t mean that it is necessarily something they want to undertake. Software audits are an investment for the software vendor, they must hire an auditing firm, or they get their own people to manage the project. The whole reason why they tolerate and perform software audits is because they feel cheated, they suspect you are using software you are not paying for and they want to be justly compensated. It may be an honest mistake on your part but to the software vendor, there is always that tiny doubt in the back of their minds that asks what if it’s not?

We have come across businesses who knew that they had software they didn’t have the licenses for and their strategy to address that issue was ‘we’ll pay when we get caught in the next audit’.

Imagine if you had a roommate who would only clean up their mess if you screamed, threatened to throw them out, and otherwise made a beast of yourself. It would obviously be an unpleasant experience for the roommate, but it would also be an unpleasant experience for you as you fight an uphill battle, straining your relationship beyond repair, just to get them to do what you both had originally agreed to. Software audits are an excellent source of revenue for software vendors, but you know what is better? Not having a compliance issue in the first place by simply following the rules and making the correct payments on time. The vendor gets exactly what they are owed, and you gain the reputation of being an ideal customer. You need software asset management to achieve such results with your software vendor.

Provide Them with Useful Feedback

The software vendors want to serve you better, they want to be able to provide you with the software that matches your business needs. However, if you have ever been in a position where you are looking for constructive feedback, one of the most frustrating type to get is just a simple nod and ‘everything’s great!’ While it might make you feel good, there’s nowhere you can really go from there. Being able to have an open dialogue with your vendor concerning the software you need and having that conversation backed by strong data, will give the vendors valuable feedback on how to better provide you with quality customer service. Instead of your conversations with the vendor solely focused on whether you’re in compliance, you can move your relationship forward with control and precision.

SAM Allows You to Frame Win-Win Scenarios

If you don’t know the first thing about your software environment, then the only real strategy you can implement during any upcoming software contract negotiations is how to get a discount. These savings may serve your company well for the short-term, but it may cut down on the quality of the product and it is an arrangement the software vendor would obviously be opposed to. Instead of resorting to strong-arm tactics and tense drawn-out stand offs, knowing what you have in your software environment will allow you to understand the whole picture of your company’s needs. You can then structure your partnership with the vendor over the long-term to ensure equal opportunities for growth and profit. Software asset management gives you the visibility into your data that you need to track the value of the software vendor’s products.