Building The Case For Software Asset Management

Many of our clients struggle with getting a software asset management (SAM) program off the ground at their organizations. Their bosses do not want to hear about SAM because it’s kind of tedious, or they don’t see the value in SAM, or the need is just not resonating. In such instances, we’ve seen that elevating the conversation to illuminate the value of SAM in conjunction with other categories of IT – cloud, hardware, service management – often works well.

Typically, the need for SAM becomes acute and easier to pitch after a painful software audit. While I don’t wish this experience on anyone, it can provide a straight-forward way to illustrate the need for launching a strong SAM program, and if you have this opportunity, I urge you to use it. To make this business case, do the following for your stakeholders:

  • Outline your disastrous audit results, show costs, what went wrong, highlight biggest mistakes and things that could have been avoided

  • Educate them about how common these audits are, and how they span nearly ALL software vendors

  • Highlight audit triggers relevant to your organization such as M&A activity, economic downturn, new leadership, etc.

  • Point to evidence that shows what’s happening to others being audited (for example, a quick Google search reveals that Quest is suing Nike for $15M in software audit findings)

This can be your window to get a SAM program going, but failing this, you’ll want to broaden your argument with more detail, as shown in the chart below.

This chart provides is a broader value proposition for a SAM program – bringing in aspects of efficiency and financial value. To add weight to this case, we recommend that you personalize these points by drawing specific information or examples from your company, as is shown at the bottom of the chart. For example, under “Operational Efficiency,” you might point out that your company’s audit tool cannot track the number of Microsoft SQL databases, which is in use all over the globe, but you don’t know exactly how many or even if they’re being used. This means you have a serious data quality problem and a visibility problem, which can only be addressed by a SAM program. To add additional weight you could highlight the typical cost of a SQL server or note your annual spend on this product alone.

Under “Audit Risk,” you could refer to a recent audit that consumed enormous resources (time and money) to resolve. If you don’t have a company example you could cite public audit cases with high dollar figures and bad PR. In terms of “Cost Control and Reduction,” you could specify the amount of unnecessary software that a SAM program could identify and eliminate in the organization. You can cite dollar waste using generic industry data or more specifically by sampling machines within your organization to build a more robust argument. All these points make the case for SAM more relevant and compelling for your stakeholders.

But very often, these arguments still don’t resonate enough, so you must figure out why and adjust your case accordingly. We decided to take a closer look at why SAM fails to better gain traction with our clients needing help. To that end, we conducted a survey that asked clients why SAM so often hits a brick wall, and here’s what we learned:

To try to push SAM forward you’ve got to discern and address concerns.

For example, you’ll notice that a lot of people claim they can negotiate out of any noncompliance issues after the fact, so they don’t need a SAM program. But what if they were supplied with accurate, proactive data long before an audit, data that helped them buy the right number of licenses, and make better purchasing decisions and save time? Bringing this kind of information to the table can bolster your case for SAM and help address the concern.

Others don’t see an ROI for SAM. This is probably because ROI is difficult to prove and maybe you need to spend more time on the math to combat that objection.

You might want to conduct a survey of your own to pinpoint where the roadblocks lie in your organization, but the idea is, there are ways to attack these concerns.

But what if there’s still no headway? Then you must consider extending the SAM business case to something bigger and more urgent. Moving SAM up a level, into the realm of IT asset management (ITAM) can add broader topics to the conversation, which might matter more to your decision makers.

The next chart shows how to elevate SAM and include areas of larger importance in the conversation.

These are some priorities that people might care about more, in which they are investing heavily: SaaS, public and private cloud, hardware assets, mobile devices management, and a big category recently among our clients is IT service management.

The cloud category is a good place to start. The next chart shows the results of a 2020 Flexera survey that illustrates what IT organizations are currently focused on.

The survey reported that in the last year, companies exceeded their cloud budgets by 23%, and to make matters worse, they don’t know why. Subsequently, their number one priority this year: optimizing their existing cloud usage.

The respondents admitted they’re struggling to budget accurately, track software and licensing, understand their bills, and control their costs. But if you think about it, these are largely just “asset management”. These areas add weight to the business case. You could say, for example, “In our SAM program, we want to tackle these key initiatives.” If you address these priorities, then a SAM program is suddenly seen as more valuable. And, these functions don't necessarily belong to any specific department, so there’s a vacuum to take on the initiative. SAM can do that. This presents an opportunity to take ownership and build your business case.

SAM tool providers have realized this too. They see that these challenges abound and are investing to expand and address them, as these headlines show.

The leading SAM tool providers are reaching for the cloud because that’s where the action is. These acquisitions are designed to do cloud expense management, cloud instance rightsizing, cloud lifecycle governance - how you request a virtual machine deploy it, track it, dispose of it. They do license management, enable deployment automation, support on prem to cloud migration. These areas are many of the same priorities that take precedence over SAM. Well, perhaps if you can’t beat them you should join them.

Another way to raise the level of the SAM conversation is to use the topic of service management. Organizations are spending a lot of money in this category. ServiceNow is coming on strong with their add-on SAM offering.

The funny thing is many clients think they’re great at service management. We hear it all the time: “Oh, yes, we're investing in it, we’re following ITIL, the industry framework for service management. We’re awesome at it.” But at the same time, I know for a fact that these clients are very weak at asset management, the natural partner of service management. I know this because we do compliance work for them. When it comes to asset management, many of them don't know where their servers are, they don't know where their PCs are, they don't know what software is installed, and they don't check their contracts when they make a service change. That’s why ServiceNow has become such a force in the SAM tool space recently -- they recognize that you can't do service management without doing asset management.

The takeaway is that you must find opportunities to relate SAM to other priorities in the organization to gain momentum.

These are just a few ideas to help you get a SAM program up and running. For more information about SAM, you can download this webinar or contact your ClearEdge representative. View the webinar "The Business Case for ITAM" below.

Tres Larsen is the Managing Director of the Compliance Services team at ClearEdge Partners.