Heading into the New Year with IT Asset Management

Heading into the New Year with IT Asset Management

It is about that time of the year when companies are trying to finalize their future budget cycle and financial allocations. Companies allocate roughly 5%, and even upwards of 10% for some industries, of company revenue for IT budget. This equates to a very large sum when you start considering the various companies in the financial, tech, retail, and manufacturing industries. To put it in perspective, a company with $10 billion in annual revenue would spend approximately $500 million. So this begs the question: Are the executives and upper management in a position to make intelligent and innovative business decisions with the data provided coming from the IT department?

LET’S TAKE A LOOK AT SOME OF THE CHALLENGES COMPANIES FACE WHEN TRYING TO FINALIZE THE FUTURE IT BUDGET.

  • No governance established – Many companies do not have an established governance, policies, or procedures in place to efficiently manage the lifecycle of IT assets. More often I see companies working as separate groups in segregated systems with no set standards and no defined ownership. This type of behavior leads to inefficiency of resources, increased risks, and costly mistakes.
  • No attention to IT Asset Management – The majority of companies have never had IT Asset Management practices at the forefront. There has not been a champion to own and incorporate it, so other priorities continue to undermine ITAM. There may also be misconceptions around ITAM practices that play a part in how well adopted they become, and stakeholders have not been properly informed of the need for it so it continues to take the back seat.
  • No ITAM Maturity – There are many companies that have basic ITAM processes in place, but many of them are manual and lacking important data points. There may not be enough resources to effectively manage and optimize the entire IT asset portfolio, the necessary tools for doing so may not be available, or a combination of the two, prevent companies from moving up the maturity scale. Also, different departments and lines of business are working separately instead of together. This makes it extremely difficult to operate with efficiency and agility and to make strategic and innovative decisions.

    SO WHAT DO YOU DO? DON’T WORRY, THERE IS HOPE!

    Start by creating your “why” statement. Why is IT Asset Management important to the company? Support your argument with concrete examples and statistics to get the attention of executives and decision makers. Executive level buy-in is critical for making an ITAM practice successful.

    Once you have executive support, work with key stakeholders on determining your highest priorities. What has the most impact on the various lines of business? Criteria may include things like largest area of spend, compliance/audit risk, time period of renewal or true-up. 

    You may currently be a in a position of preparing to finalize the 2020 budget, and the task feels daunting if you identify with any or all of the challenges listed above. You may know that you need to present the challenges to managers to gain their support, but you are not sure how or where to start. If so, we would love to help you get started.

    We can partner with you at any point along your journey to help you map out and execute ITAM maturity.

    Making sense of the Software Asset Management (SAM) puzzle.

    Making sense of the Software Asset Management (SAM) puzzle.

    Picture this: You’re blindfolded, trying to complete a 4,000 piece puzzle—and the clock is ticking. Your company is in the middle of a vendor audit, and you don’t know who to talk to or even what to ask to accurately finish the puzzle on time. Stress and panic begin to take hold.

    That’s how software asset management (SAM) can make you feel. But don’t panic. A strong SAM program reduces the guesswork, improves long term financial standing, and creates a proactive approach to software licensing and expenditure.

    Many companies over-purchase and/or over-deploy software products to try and fulfill a business need, and they end up losing sight of their current license position. Every company is different, with differing goals, needs, and business strategies. An effective SAM practice implements policies and procedures that address the lifecycle of  software assets. A software asset manager is responsible for the management of the purchase, understanding the terms and conditions and the contract negotiation, as well as the actual utilization in the company’s IT environment. At the end of it’s lifecycle, he or she is responsible for the reharvesting of the software license or the retirement of the product. This in-depth knowledge allows companies to  optimize future purchases and take advantage of software bundling opportunities and other ways to save money.

    SAM can be complex, and finding the right solution takes careful consideration of many factors. Company policies, budget, current and future projects, and historical data markers are simply a few things that have an impact on the effectiveness of a SAM practice. Your SAM strategy must address your company’s needs today—but it also needs to be fluid and adaptable so that it can withstand organizational changes. Software asset managers have to adjust his or her approach based on the situation, whether facing software vendor audits, compliance remediation and maintenance, or taking advantage of  new purchase and renewal opportunities.

    A software asset manager must do a deep dive investigation of all factors that affect the SAM practice and then present the overall picture to company executives, helping them understand the current license utilization and how it’s influencing the bottom line and compliance position. That means showing not only what products are deployed, but also how they’re being used—and if they’re meeting company needs.

    Corporations implement SAM strategies to help control and lower cost—but more important, they do it to maintain compliance. Sometimes SAM seems like an impossible puzzle, especially when you’re crunched for time and resources. As a software consulting firm, CleanSlate leverages our years of experience and depth of knowledge to help our clients do just that.