Why You Need a Software Asset Management Solution
The need for Software Asset Management is driven by many factors, including the rising cost of enterprise software and the growing portions of IT budgets allocated towards software purchases and subscriptions. Also adding to the urgency is the growing reliance of end-users on software applications in order to execute their day-to-day activities, and the challenges faced by IT departments in supporting these increasingly complex systems.
With Software Asset Management, businesses are able to:
- Establish and enforce formal procedures for budgeting, purchasing, deploying, and using software
- Enhance strategic technology planning and make more informed software purchasing decisions by obtaining complete visibility into existing inventories
- Increase employee efficiency by accelerating the deployment of mission-critical software solutions
- Ensure adherence to standards and security policies
- Reduce IT support costs by minimizing the number and length of helpdesk calls
- Streamline administration of software assets, including upgrades and routine maintenance. Administration currently accounts for close to 33 percent of software budget consumption, according to Forrester Research. And the Information Technology Research Institute states that the cost of maintaining software throughout its lifetime can total as much as 90 percent of the initial purchase price.
Leading industry analyst firm Gartner also cites reduced software total cost of ownership (TCO), greater economies of scale, improved efficiency and cost-effectiveness of support and help desk operations, and the ability to create knowledge bases and best practices around software management as some of the major benefits Software Asset Management can offer.
Not less important than the benefits that companies can achieve through the implementation and use of Software Asset Management, tough, are the serious commercial, legal, operational, and financial risks they face if they don’t put in place the procedures and tools needed to effectively manage their software applications.
A poll conducted recently by IDC shows that less than half of companies have formal Software Asset Management practices and procedures in place. , In a similar Gartner study, 38 percent of organizations admitted that they had little more than a basic understanding of their software licenses.
This leaves these companies in a highly vulnerable state. For example, without Software Asset Management in place, these businesses are subject to:
- “Shelfware”, or software solutions that are purchased but never installed or utilized. Gartner estimates that approximately 20 percent of software owned by companies is never used. And, a report issued by Morgan Stanley and AMR Research indicates that almost half of all CRM licenses purchased are never allocated.
- Fines and penalties imposed due to non-compliance with licensing agreements.
- Significant staff downtime caused by extensive use of unauthorized software, such as IM-style programs or games. A 2007 study by independent market research company NewDiligence claims that 85% of corporate employees use IM, peer-to-peer collaboration or sharing, or anonymizers while at work.
- Increased threat from damage caused by hackers, viruses, spyware, malware, etc.
