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How to set vendor scope

 

"It is important to prioritise your efforts, as the chances are that upwards of 80% of the annual software spend goes on software from just a handful of vendors."

“It is important to prioritise your efforts, as the chances are that upwards of 80% of the annual software spend goes on software from just a handful of vendors.”

Tina Fruhauf, Practice Leader at Computacenter peels back the covers and explains what factors should be considered when prioritising vendors when starting a SAM program.

I often get asked, ‘Where do I start?’, when customers want to embark on a journey to a mature Software Asset Management practice.

In my experience customers often find that determining what vendors to enrol in the SAM program, is more difficult than first expected. There are typically lots of different evaluation factors;

  • Annual spend
  • Perceived audit risk
  • Proliferation
  • Ability to control
  • Importance to the business
  • Enterprise wide agreements

It is important to prioritise your efforts, as the chances are that upwards of 80% of the annual software spend goes on software from just a handful of vendors. Spend per year must be considered, but should not be the only driver.

The current vendor audit trend is unlikely to change. It is more likely than ever that an organisation will be approached by a vendor, who is looking for confirmation of your license position. The chances of a vendor ‘re-auditing’ are also increased as agreements come to the point of renewal. Therefore, perceived risk of audit has to be another key consideration. Vendors tend to look at the anniversary/renewal dates as a catalyst for SAM activity, so having a view on this timeline is helpful.

If your organisation has the means by which to determine how prolific an application is within the estate, such as data analysis and cleansing of the inventory tool/s, these can be worthy considerations. However there is limited return in focusing on a product that is used by a handful of users (unless the license and maintenance costs are significant).

The less centralised control an organisation has over the purchase negotiations and/or the deployment of software, the more likely is the case that compliance gaps will arise. However when starting out on a SAM program it is important to show the effectiveness and control that the SAM owners have over their IT assets. This enables them enforce any recommendation or remediation actions that are key to establish the necessary processes. So whilst it might seem at odds with the logic, I would not recommend including vendors which are not within the sphere of control, from the outset.

It is also important that an organisation defines how important an application or piece of infrastructure software is to the business. There are many applications that are key to ensuring the on-going availability of a business service, that are not necessarily expensive or required to be bought in significant volumes, but the criticality of such applications or infrastructure software should be a key factor in determining which vendors should be prioritised.

The last factor for consideration is the licensing agreements that have been established. For example enterprise wide agreements offer a simplified vehicle for consumption, but without the contractual detail being understood, these agreements can sometime be seen as an all you can eat buffet. If an organisation does not have the ability to properly manage and report on deployment, these agreements can result in significant true up costs and increased annual maintenance fees.

If it’s determined that the organisation’s software is spread over a lot of vendors that all have the same or a very similar weighting, I suggest “start simple”, as licensing is complex. Thankfully though, some licensing schemes are simpler to administer and manage than others. So rather than diving in at the deep end, sometimes it’s better to cut your teeth on the more simple desktop applications and work up to more complex server licensing challenges.

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About Tina Fruhauf

Tina has 12 years experience helping organisations understand the often complex and baffling world of software licensing & asset management. She has been at CC for 8 years and is responsible for Computacenter’s SAM  and Licensing practice. Focusing developing services, evaluating technologies and setting the strategic direction for the supply and management of software licenses.

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