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Advanced License Optimization : Go Beyond Compliance for Maximum Cost Savings

Bernhard Boehler

Bernhard Boehler, Aspera

By Bernhard Boehler, Co-founder & CEO, Aspera Technologies Inc.

Introduction

If you are going to do Software Asset Management (SAM), why stop at license compliance? With SAM, contracting and procuring software in ways that ensure compliance is synonymous with buying smarter. And buying smarter means knowing everything about your organization’s software contracts and software usage habits so that you can purchase the most cost-effective licensing option. Enterprises with SAM have consolidated information about software usage that is expertly normalized and structured, enabling them to prepare for true-ups and purchases with greater ease and efficiency. Build on the compliance foundation by adding Advanced License Optimization to your SAM program and drive better software license procurement decisions for greater, long-term cost savings.

Compliancy

Traditionally, SAM focuses on compliance, ensuring that a company has enough licenses to cover its software usage. The principle is straight-forward: one installation of Microsoft Office here, one matching license there. But, in practice, enterprises realize the intricacies of licensing require specialized expertise and tools in order to gain control of compliance.

For starters, data must be gathered from all corners of the enterprise and consolidated to figure out:

  • What software is installed on which machines?
  • Is it a stand-alone product or a suite?
  • Who uses the machines?
  • How is the machine configured?
  • What dependencies does the machine have to other devices e.g. terminal servers, server farms, virtualization, mobile devices, etc.
  • Does the company have a license that accurately covers the software usage on the particular machine? (And to answer this question, the company needs to know the terms & conditions of the license, including specifics in the product use rights and license metric.)

Unstructured Big Data

In global enterprises with decentralized structures – where software licenses are acquired across separately operating cost centers – getting a handle on software costs and license compliance becomes a Herculean task. Gathering the software usage data alone is an unstructured Big Data adventure. Excel spreadsheets don’t come close to getting the job done. More than one inventory tool is needed. And ascertaining the actual licensable software products from the millions of white noise data points is a task often insufficiently supported by discovery tools and IT Asset Management suites.

Integrated discovery tools in suite products do not dive deeply enough to gather all the required information to manage all the license metrics that are high risk in an organization. Generally, these tools are designed for desktop scans and superficial server inventory. This means that certain required data are not provided by the discovery system, and the organization must rely scripts and additional tools to fill the data holes.

And for the data center, configurations are paramount (e.g. User profiles for SAP, hardware configurations for IBM, database settings for Oracle) as well as virtual machine to host device relationships. The majority of integrated discovery tools do not collect this required information. Consider the all data you need to make sense of Oracle metrics:

  • > Database instance name
  • > Server status
  • > Installed software
  • > Processor model
  • > Number of processors or used sockets
  • > Total amount of processor cores
  • > Server hardware partition
  • > Number of named users
  • > Database management packets
  • > Database options
  • > License metric

And each software publisher requires a different set of data to manage its metrics. This means that no one discovery tool is able to collect all of the required data for all license metrics within a typical SAM scope. Therefore, Software Asset Management must consolidate the software inventory, usage and configuration data from multiple discovery sources.

Data Analysis

Then comes the analysis of the data. Each software publisher has its own licensing rules; and depending on the contract and, quintessentially, on the machine, the licensing can vary drastically. Is it client software? Is it server software? (DB2 anyone? Oracle Database, Windows Server?) Incorrectly applying the license rules has substantial financial consequences for the enterprise. And the results of the data analysis does not only influence IT procurement decisions, budget planning, and finance. They must equally convince software publishers whose software audits and hefty price tags on under-licensing (not having enough licenses to cover the software usage) pose an ever-present risk.

Some mindful IT procurement managers buy surplus licenses to protect against under-licensing. This is an expensive habit and a lack of understanding of the IT environment and/or how to apply the complex licensing rules means the company is still under-licensed, or worse, that the wrong license model was procured.

An article in the ITAM Review revealed that 60% of SAM managers still spend the majority of their daily work conducting the data analysis by hand, even though SAM Tools automated this over 10 years ago!

SAM Tools drive efficiency, better control and transparency

Enterprises that implement a Software Asset Management program, supported by a specialized SAM Tool, have an advantage in a highly competitive, IT-reliant world. A specialized tool reinforces technical processes and significantly eases the data gathering, consolidation and normalization process. A SAM Tool is designed to leverage your existing IT systems and connect to multiple discovery data sources. It combines and normalizes the data, maintaining a high level of data quality for insightful analyses with one click. Those SAM managers doing this work by hand can turn their efforts to skilled technical or analytical roles, and as a byproduct of the SAM Tool, employee productivity increases.

The most basic functionality of any SKU catalog-based SAM Tool is to produce automated compliance analyses. Here, the tool comes with intelligence for applying the licensing rules of all common software publishers while greatly increasing the efficiency – and reliability – of compliance management. The main goals of compliance management are to develop strategies ensure continuous compliance and reduce the risk of failing an audit while controlling license costs.

The enterprise is then able pro-actively manage its software usage, licenses, and compliance position at all times and software audits are no longer an uncontrollable risk. Empowered by the SAM Tool, the enterprise can verify its compliance with one click: e.g. is that really a server with 2 quad-core processors, or is Oracle Database SE1 installed on a 4 dual-core processor machine?

Advanced License Optimization (ALO)

Managing software licenses correctly can result in big savings.

Managing software licenses correctly can result in big savings.

Software Asset Management should not exclusively be about compliance. Compliance management takes the “here and now” into account—and therefore shows a situational snapshot. With a specialized SAM Tool, enterprises can go one step further to build on the compliance foundation and strategically reduce software costs, ultimately optimizing their licensing position. Achieving an optimized license position means using the compliance analyses and knowledge about your enterprise’s software usage habits, to precisely match license purchases to the demand for licenses. In doing so the various licensing options available to the organization must be evaluated to ensure the most cost-effective option is taken.

Advanced License Optimization (ALO) means understanding your software usage in a dynamic environment at any given moment, and deploying the most cost-effective license. In order to do this, the SAM Tool analyses different software usage scenarios and compares the different licensing models available to reveal the best licensing option for the company. And of course the evaluations are based on each publisher’s specific licensing rules, so the most cost-effective license model for virtualized machines, server clusters, and the Cloud can be determined by a click of the mouse – while still ensuring compliance and audit readiness.

Through ALO enterprises take the guesswork out of compliance and have the information needed for true-ups and contract renewals at their fingertips. They are able to reduce software costs long-term by strategically planning Enterprise Agreements, answering questions like, “Is Standard, Enterprise, or Datacenter licensing more economical?” Existing software investments can be maximized through immediate financial wins, for example by analyzing where sub-capacity licensing is more lucrative than full-capacity. Software product for software product, Enterprise Agreement for Enterprise Agreement, companies can use the SAM Tool to systematically optimize their licenses to reduce costs.

License Optimization = Financial consequences

Optimization is also not a one-way street. The coin can be flipped to reveal the financial consequences of changes in the IT environment on the demand for licenses. Specifically, enterprises can directly pin-point which servers or cluster, which software installations, or which virtual instances are the cost drivers in the given data center—as well as how to optimize the configurations and architectures to reduce future software spend.

The IT budget is therefore no longer created using forecasts based on a single snap-shot of a fluid IT environment. Optimized SAM enables enterprises to simulate potential future software usage scenarios and strategically plan purchases, while still ensuring compliance. What’s more, it empowers IT to concretely answer questions regarding the monetary benefits of its SAM activities. (“Yes, we want budget for this. Don’t tell us you already forgot that we saved 7 million last quarter!”)

Armed with complete understanding of the enterprise’s software and licensing assets SAM managers can unlock the full potential of Software Asset Management for all stakeholders. As a result, SAM becomes an active, strategic, component of data center architecture, IT contract and procurement planning, and portfolio management. The data does not have to be manually researched and prepared—it’s automatically and perpetually available in the SAM Tool.

About the Author

Bernhard Boehler brings over 15 years of experience to his role as CEO of Aspera Technologies Inc., where he is in charge of international operations management. Before he co-founded Aspera, Bernhard was Volume Account Manager at Software Spectrum Inc., where he was responsible for Fortune 500 companies in Germany and the coordination of international sales projects.

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