Software Asset Management; How to Save $1M Dollars
Many statements are bandied about the industry on how much you can save with Software Asset Management, for example:
“Organizations can realize cost savings between 5% and 35% by implementing focussed software asset management practices” Gartner
Less common, are examples of organisations explaining how they actually went about it. It is a strange phenomenon in the ITAM industry, organizations are all too keen to go on record to demonstrate how much money they saved by being prudent with energy consumption – but not software.
For this reason I was glad to see a case study from Sassafras Software which offered real details into how savings were found. It reads as follows:
“In 2009, Scott Lemm, a well known SAM practitioner from Michigan, deployed K2 into a corporate environment of 10,000 computers on a global network. In the course of just four months Scott delivered software cost reductions of greater than $1-million. Here is how he did it.
Using Sassafras K2, Scott reported…
- Less than 10% of Microsoft Office users utilize Pro tools. Scott was able to use this information to reduce their Microsoft Office costs by $450,000 by licensing the Standard edition at their next EA negotiation.
- Seven applications had over 1,200 unused installations. Scott was able to harvest the unused software for savings over $220,000.
- The same seven applications had over 2,200 rarely used installations. The company decided to install application kiosks for savings over $260,000.
- Two applications licensed for over 8,000 users showed concurrent use of less than 10 at any one time. Scott’s organization renegotiated licensing terms to move to concurrent use licensing for savings over $125,000.
- In roughly four months, with a quick deployment of the K2 – KeyAuditor & KeyServer SAM tool, Scott was able to identify and generate $1,055,000 in real cost reductions.
Scott pointed out, however, that it was his ability to mine detailed usage metrics provided by Sassafras K2 that made it possible for him to reap so much in savings. K2 provided him with detailed visibility into usage that was critically important in achieving his objectives.”
View more about Sassafras Software here.
More like this please! If you have a story to share from your brag file (Anonymously or otherwise) Please contact me.
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About Martin Thompson
Martin is also the founder of ITAM Forum, a not-for-profit trade body for the ITAM industry created to raise the profile of the profession and bring an organisational certification to market. On a voluntary basis Martin is a contributor to ISO WG21 which develops the ITAM International Standard ISO/IEC 19770.
He is also the author of the book "Practical ITAM - The essential guide for IT Asset Managers", a book that describes how to get started and make a difference in the field of IT Asset Management. In addition, Martin developed the PITAM training course and certification.
Prior to founding the ITAM Review in 2008 Martin worked for Centennial Software (Ivanti), Silicon Graphics, CA Technologies and Computer 2000 (Tech Data).
When not working, Martin likes to Ski, Hike, Motorbike and spend time with his young family.
Connect with Martin on LinkedIn.
This has been one of my primary complaints about current SAM
practices…there’s been too much focus on “form” and not enough on “practicality”. I can’t tell you how many companies have SAM
programs that focus solely on compliance and not at all on ROI (one of the reasons I’m speaking on the topic of ROI at this year’s ITAM
conference in Nashville).
Real life examples? These are all results of our direct work but the company savings have been
considerable:
East coast hospital reduces software costs by $700k/year through negotiations and enhanced purchasing program
knowledge.
California technology company cuts Microsoft licensing by $280k through proper integration into Partner program.
North Carolina company cuts Microsoft true-up by $240k through enhanced knowledge or product use rights and purchasing program terms
and conditions.
California credit union reduces software costs by $12k/month due to improved vendor negotiations, removal of
redundant tools in infrastructure and implementation of key controls.
Montana bank cuts Microsoft true-up by $140k through
enhanced knowledge of product use rights and past purchasing program terms and conditions.
That’s it for the past 3 months…I
know there were more earlier this year…
Martin, software harvesting would be a cost avoidance, not a cost savings. The software publishers generally won’t give you a rebate or credit for software you no longer use. The company is avoiding purchasing another license by leveraging an available license.
Taylor, yes, you are right. Although, yes you can negotiate concessions if you can prove you have unused software with some publishers. It is an additional bargaining tool.
I agree Martin, at that point, it would be cost savings. However, the article did not make it seem like Scott went to this extent. As it was presented, the software harvesting was only taken into account. If this was the case, I think it is deceiving to account for all unused software to be accounted in cost reductions because the reductions only happen when the software harvested is reinstalled to meet a new request. Otherwise, it’s just available software “in stock”.
Agreed.