Software Asset Management (SAM) describes a set of established IT practices, which bring together technology, people, and processes to optimize and control software use within an organization. SAM is beneficial for controlling costs, managing legal and business risks, and optimizing software licensure.
There is some confusion in industry circles between SAM and its related subsets, Software License Management (SLM) and Software License Compliance (SLC). Part of the reason SAM initiatives fall below expectations is this inability to differentiate SAM from related concepts.
This article outlines the foundations of SAM and its subsets and details on compliance and management. Successful implementation of SAM programs must begin with the rudimentary concepts on which the program will be built. Read on to understand more.
Foundations of SAM
SAM is a subset of IT asset management (ITAM), which is a subset of IT service management. ITAM is a framework of business practices combining inventory, contracts, purchases, and infrastructure to support lifecycle management and strategic decision-making.
IT assets are software and hardware acquired from outside sources, and their related services, including support and maintenance. It includes services related to IT assets owned by a third-party, whether or not these services are accessed through the installation of software on client devices. Examples include cloud-based services like SaaS, HaaS, and IaaS, among others.
Importance/Impact of SAM
Investing in SAM can help optimize both hard and software costs of IT asset management. SAM ensures organizations have the most optimal licensing programs according to organizational needs. It contributes to accurate IT budgeting and cost forecasting for better decision-making.
SAM includes the tracking of software and IT assets, and process automation to increase efficiency, reduce support costs, and adobe new technologies. Business and legal risks resulting from inappropriate software deployment or security vulnerabilities can be controlled with SAM. Part of SAM is also ensuring compliance with government requirements and regulatory standards.
SAM allows organizations to maximize returns on software investment by decreasing redundancy, providing staff with the necessary tools and standardizing processes. An organization with a well run SAM program, will only ever pay for exactly what software is being used by the business IT resources can be optimized, and employee efficiency, agility, and output increased.
Finally, as organizations grow, they need scalable IT infrastructure, and SAM can create a stable and scalable foundation for infrastructural growth. When fully implemented, a SAM program creates an efficient system that can adapt to changing market opportunities and plan for future software requirements. Organizations can also increase agility by using resources better, helping them weather any changes in the business environment.
Related: 5 Tips and Tricks When Getting Started With Software Asset Management
Subsets of SAM
Software asset management focuses on organizational software assets, licenses, and related services. It also includes any physical or digital media used to deliver software. There are two major subsets of SAM, SLM, and SLC.
1. Software License Management
SLM includes software license optimization. It goes beyond SLC and focuses on “right-licensing”, i.e. avoiding unnecessary license quantities, functions or types. Most organizations have over-licensed product quantities or product functions, e.g. standard edition versus enterprise edition.
Objectives of software license management include:
- Ensuring the organization has the right licenses – includes querying what various licenses are used for and whether such usage goes beyond bounds allowed in the SLA
- Avoiding unnecessary direct costs in support or license maintenance – ensuring that licenses paid for are used in full, ensuring that direct costs provide comparable value to the organization
- Ensuring licenses are deployed optimally, so that reasonable effort is invested in license management
- Avoiding unnecessary complexity in the acquisition of software and licenses
Sometimes, there is a more optimal software deployment, which reduces both cost and licensing requirements. For example, shifting software to a smaller but more efficient server.
SAM overarches both subsets to focus on the software asset or product. Features evaluated include full lifecycle cost, currency, standardization, and function.
2. Software License Compliance
SLC is focused on guaranteeing that organizations are not “under-licensed” by ensuring that license entitlements have been complied with. Usually, the focus here is on the number of licenses vis-à-vis software deployments. Compliance also accounts for such other license parameters as geographic location, device configuration, and employee/non-employee authorization among others.
SLC is a broad term describing an organization’s behavior in relation to software, i.e. are they using it within the bounds established by the software licensing agreement (SLA) or entitlement purchased by the organization?
Software License Enforcement
It includes software license enforcement, which is/are the mechanism(s) used to manage SLC. An enforcement mechanism is typically a method used to inform a user that they are overstepping the bounds set in the SLA.
Enforcement technologies and implementation methods are designed to create a balance between the needs of the software consumer and producer. Generally, the producer uses enforcement to increase revenue by:
- Making easy-to-use software causing more customers to buy in
- Eliminating loss of revenue through software piracy or overstepping SLAs
The producer must consider that consumers do not want unnecessary barriers to software adoption, but they also want to comply to reduce their risk and liability.
Therefore, in compliance, an organization takes inventory of all software installed on the network and compares it to the software they are legally authorized to use. This is done by bringing together purchase documentation and licensing contracts to establish proof of license ownership.
Importance of Compliance
Compliance aims at ensuring the organization would pass an IT Vendor Audit. Arbitrary software purchasing leaves many organizations over- or under-licensed, which creates waste or risk, respectively.
Taking time to audit software assets helps organizations remain informed about their license installations and entitlements. This is done through regular and comprehensive inventory checks and the IT manager often leads it. In this way, organizations can reduce the wastage of resources in over-licensing or banish the risk of incurring audit fines because of under-licensing.
3 Steps to Improve Software License Compliance
Manual compliance monitoring can be challenging. This is where an efficient SAM system comes in. While an additional investment, SAM systems pay for themselves in guaranteed compliance and cost savings. The following steps will help you ensure compliance in the organization:
1. Understanding Risk
Organizations must review the way software comes into the organization. This includes concerns like the person that authorizes the purchase, how SLAs are recorded, who carries out software installation and the way processes are communicated to end-users or employees.
It includes:
- Keeping a clear record of software installed on the computers
- Maintaining a current and accurate inventory of software deployed throughout the organization
- Conducting regular software audits to reconcile the inventory with the licenses in hand
- Ensuring users sign that they know/acknowledge and understand software licenses and processes
If an organization has not done any of the above, there may be a risk on some level, and a software audit should be scheduled as soon as possible. If discrepancies are found between inventories and licensing, take steps to ensure compliance.
2. Maintaining Compliance
Using the baseline established, implement policies and processes to make future control and management of software assets easier in the future. These include:
- Increasing staff, management and user awareness of the importance of SLC, with periodic reminders
- Reviewing IT policies to ensure robust SAM practices are promoted. Every time there’s a change, users should be educated, and their agreement is received in writing
- Reviewing and improving practices related to software asset procurement, usage, and retirement
- Educating organizational staff on the procedures that back software policies as well as the effects of non-compliance
By proactively managing license policies, the time taken between software compliance audits can decrease, and the surplus is devoted the time to core business competencies. In time, organizations will enjoy the benefits of compliance in higher productivity and financial savings, among others.
3. Optimizing Licenses
Now that the organization has full control of its software licensing practices, proactive planning for the future is necessary. This includes:
- Implementing programs that enable collection and recycling of unused software rather than purchasing new licenses – provided it adheres to the SLA
- Reviewing procurement and maintenance contracts according to changing patterns of software usage in the organization
- Ensuring internal software developers understand licensing costs and options when building business applications that need external software support
These steps will help plan for future organizational growth and changing market needs and what these factors mean to SAM and SLC. Organizations without the in-house resources for SAM should invest in consultancy services to spearhead compliance audit and SLC planning. Consultants may train internal IT staff on how to maintain the systems they have established.
Objectives of SAM
Once the objectives of SLC and SLM have been fulfilled, SAM expands the focus to include the qualities of the software assets. The following are SAM objectives and how they are achieved:
- Reducing technological complexity, e.g. by standardization of products – Ask whether the software products currently used are the best. Find out whether there are newer products that may better suit the organizational objectives
- Reducing lifecycle costs, both direct and indirect – Find out whether there are functionally redundant products. Determine whether you have more advanced product versions where standard versions would do
- Maximizing value and returns – determine whether products are deployed and used optimally
- Ensuring proper support for IT and non-IT functions – determining whether products are well-supported internally and externally
- Strategic planning – establish a product roadmap, both for organizational use and according to the publisher’s plan. How will the product fit in the organization’s future plans? Finally, determine whether lifecycle costs correspond with value addition
Note that hardware tracking is part of all three aspects of software management. It includes querying device capacity and characteristics to ensure they meet those stipulated in the licenses.
Importance of SAM Differentiation
The success of a SAM program depends on managing expectations of stakeholders and establishing a similar understanding of the key concepts. Specifically, differentiation between the SAM subsets is necessary to:
- Establish the benefits or expected results from each subset
- Determine a suitable budget and plan
- Remove ambiguity from standard definitions for business purposes, e.g. license, IT asset, etc.
- Define a suitable program/framework to evaluate present practices and implement improvements
- Within the said framework, determine the necessary processes, policies, technologies, data and accountabilities or roles
- Get suitable resources according to the requisite knowledge and experience and provide essential training
If SAM is implemented correctly, organizations stand to cut costs and save time and resources, thereby accelerating business growth. Proper implementation empowers the IT manager by giving them a comprehensive understanding of their software assets and the best management methods to optimize business growth and cost reduction goals.
Key Takeaways
The benefits of a software asset management program cannot be overstated. However, for SAM initiatives to succeed, all stakeholders must understand and develop a consensus on the scope and objectives of the SAM program.
SAM is implemented through a SAM team. It may be comprised of in-house IT staff, managed IT service providers (MSP) or contract employees. Generally, the IT manager facilitates communication when an external team spearheads SAM.
This ensures that a suitable solution is implemented in all aspects – roles and accountabilities, policies, resources, and technologies. Differentiating the contributions made by the different subsets will facilitate an in-depth understanding of the organization’s health with respect to its software assets. At each point, proper implementation will ensure SAM maturity that will result in organization-wide success.
