Ahead of our upcoming conference – Wisdom EMEA online (June 9-11), we spoke to some of our sponsors and asked “What long-term changes will COVID-19 bring to ITAM”?
The COVID-19 Coronavirus pandemic has had a huge impact on 2020 for countless people and businesses across the globe. Deaths from the virus have changed 100,000’s of people’s lives and ongoing public health concerns may result in a society that looks and moves markedly differently from today. Alongside this, the economic shutdown means a lot of uncertainty for companies and staff now, and into the future. All businesses will find themselves needing to adapt to a multitude of changes and challenges and reduce costs and increase cashflow at the same time.
While ITAM may not seem particularly important in some respects right now, it can be a key element in helping businesses survive, and even thrive, by reducing outgoings, increasing efficiency, and helping manage the digital transformation that is already taking place – and will continue to do so. Understanding the landscape and planning as best one can now will help organisations set a more solid foundation going forwards.
You can’t help but compare what’s on the horizon to what took place in 2008 when the recession hit, because ITAM managers learned a lot of fantastic skills during that period and they’ll be well suited to navigate what’s ahead. What we saw was that when people stopped voluntarily buying software, these mega-vendors’ appetites for big numbers and revenue steered their attentions to software audits and really drove up the frequency of them. They essentially made customers buy their software through tricks and complicated contracts.
Fast forward to today and you have to wonder: will they do this again? Well, it wouldn’t be surprising. You have to think that we won’t be going back to the office with regularity any time soon until there’s mass testing and a vaccine. Because of that, our reliance on technology is much greater than it was in 2008 and it’ll only continue. We’re using technology we already had in our stack and we’re using new technology – there’s even going to be technology introduced that doesn’t exist just yet. At the same time, licenses are just as difficult to understand, and audits are just as complicated as they ever were.
In saying all of this, there’s an opportunity for ITAM to be the saviour for their company – like a member of Marvel’s Avengers, fighting off the villains (or vendors). The level of expertise among ITAM professionals is just phenomenal and they’ll need to maintain a complete and total understanding of their digital estates if they want to keep costs down and maintain an efficient tech stack.
Once this current situation clears, we’ll also see companies returning to their goals and objectives. One that many have taken on is the idea of environmental sustainability and reducing their carbon footprint. For ITAM, this will manifest itself as asset sustainability – the environmental impact of an asset from the cradle to the grave. So, if we take software as an example, we know that every license is associated with a piece of hardware – and understanding the individual impact of that piece of software on the environment via its hardware will be a big priority. For instance, one application may be cheaper than another to run, but it may consume more resources and thus negatively impact the company’s environmental goals. ITAMs will play a key role in helping their businesses navigate those decisions – and I think they’ll navigate it well.
Organizations spent the last few months scrambling to enable employees to work from home. ITAM professionals will need to gain visibility into all the new technologies they’ve added and establish governance around them for both financial and security reasons. Likewise, few of our organizations will be spared from the need to significantly cut costs, so Asset Managers will be on the front lines of driving down ongoing and new spend both on-prem and in the cloud. It’ll be critical to have visibility across your IT investments and identify potential savings. Compliance will also need to be a priority since the major software vendors will be under pressure to keep maintain revenues and falling revenue has historically driven upswings in audit activity. Efficiency also will be imperative. Manual, resource-intensive processes will become unworkable as IT organizations experience headcount reductions, even as the need for accurate real-time data grows as organizations adjust business strategies on the fly. Automation and real-time data will be critical success factors.
While we may wish for a “return to normal,” the reality is that COVID-19 is unprecedented and on par with the major events of the 20th century like World War II, the establishment of the European Union and the fall of the Berlin Wall. In all these cases, economies around the world underwent significant changes that caused some industries to die off while others took their place. C-Level executives are already focusing on these macro-level changes. They’re using analysis tools like this Harvard Business Review framework to assess how their business models need to change. IT Leaders, including ITAM managers, need to adapt as their organizations evolve in response to changes in demand and long-term business model changes.
Asset managers need to think how they can support these changes. When offices open, they’ll look fundamentally different. Remote work will be the default for information workers for organizations that previously had an “in-the-office” mentality. Companies in industries that require hands-on work will have to invest in new technologies to keep workers safe, creating additional budget pressures. Some companies and industries will be in for a much longer contraction. Regardless of the specific changes, successful IT asset managers will need to quickly deliver accurate data to support the decisions that leaders need to make to keep their organizations viable.
When we do not know what the future is made of, what should we do? We need to be prudent but strong and anticipate all possible directions. What does that mean for ITAM?
The most important thing is not to neglect any scenario and to be open to change. Let’s say your company has adopted a fully cloud strategy…perhaps now is the time to consider a hybrid scenario where on premises may not be given up completely. At the opposite end of the scale, perhaps your company is ‘anti-cloud’ and pays more for the on-premises version of a solution? Now, with cost savings so critical, would be a good time to revisit the rationale behind such decisions. Ultimately, this crisis may indirectly lead to the removal of certain obstacles.
It should be considered that opportunities will also be reduced for Software vendors and you should consider your relationships with them. A sharp “no-more-investment” strategy will probably lead increased audit risks – from multiple vendors. Do you really want to spend the next months or years dealing with that rather than focusing on pro-active operations in your changing business market? Vendor consolidation could be an option; for example, if your company has historically deployed many different vendor technologies (middleware, databases…), it might be the right time to focus on one single technology, sign a major contract with the selected vendor, and move forwards with them.
The number and diversity of assets remain large and complex to manage, and so ITAM remains strategic. Yet, will the day-to-day job remain the same as before? We do not know yet, but let’s get prepared for some changes, just in case …
Let’s start with four big-ticket items.
In April 2020, Gartner surveyed 229 HR leaders and found that historically around 30% of workers had performed their role remotely at least occasionally. Today, 65% of the HR leaders report that at least 61% of their staff are remote, with nearly 50% reporting the figure of remote working employees at 81% or higher.
Perhaps no great surprise there. But the most interesting finding was that 41% of employees will expect to retain at least some remote working practice post-COVID-19. So that’s an additional 11% of the workforce that won’t be permanently office-based. In the UK that’s at least three million people. Three million users that are changing their behaviours. Three million (likely more when you include mobiles and tablets) devices that might not see the corporate network for months on end.
So, the first change I think ITAM will have to cope with is managing devices that are not in the workplace. Visibility of these devices might not a great problem if you’re using decent inventory technologies and all your users are dialing-in via VPN. But it could be a major headache if not. And that’s just inventory; of course, ITAM needs to go beyond simply knowing devices exist, we need to be able to support users, provision software, apply updates, remediate issues and more.
This leads us into the next change, which is the surge in new devices caused by Covid-19 as many organizations literally had to buy whatever was on offer to equip staff to work from home. To paraphrase a conversation between one of our SHI account execs and a large New York based customer… Rep: “Do you want us to find you laptops, Chromebooks, iPads or other tablets?” Customer: “Yes”.
As a result, there are now an unknown (but very large) number of previously unsanctioned devices being used to keep employees working. Of course, as employees get used to them, they probably won’t want to give them up. So, they are going to need to be managed and officially incorporated into the ITAM program.
My third change is the software that ITAM and SAM teams will be asked to manage. It’s not like Cloud and SaaS wasn’t already a thing, but the scale and rate of adoption spiked in March, April, and May of 2020. ITAM teams that were thinking it wasn’t yet time to devote too much attention to their organization’s spend on SaaS probably need to think again. This is especially pertinent when you consider that much of this adoption was not managed centrally and decisions (and costs) were taken at a local, department or even individual level.
Which brings us neatly to my final change. For too long, ITAM and SAM have had a strong compliance focus, with notions of moving toward cost optimization often scuppered by more urgent needs. The bad news is that I think compliance might become a bigger issue again from late 2020, but the real change is that ITAM is going to get demands from above to drive real, tangible cost savings.
It’s an empowerment that many ITAM teams may have longed-for, but it’s going to be difficult to know where to cut and how deep. And it’s going to demand really good data and the skills to make really sound decision making.
The looming global recession brought about by COVID-19 causes a reduction of corporate liquidity in terms of running costs and especially new purchases. A key question is therefore: What solutions does the ITAM industry offer to make sure that companies can be equipped with high-quality software at a low price?
During the last decade, pre-owned software has gained in acceptance and popularity. Many renowned companies all over Europe have successfully reduced their IT spend by implementing second-hand software. Current trends show that in challenging times, IT executives are more open-minded when it comes to pre-owned software. Who can blame them as buying pre-owned software can save companies up to 70% compared to licensing with new software. Since pre-owned software is currently on the rise, it is likely that, even after the crisis, companies will continue to look at purchasing pre-owned software instead of expensive new licenses.
The global leaders in the software market have long since moved their latest products to the cloud for companies to rent on a monthly basis. However, the subscription fees of those cloud products are often very expensive, and many companies only use a fraction of what’s included in the bundles. The solution is simple and cost effective: hybrid models combining pre-owned software and affordable basic versions of the cloud models. By using such hybrid models, companies can save significant amounts of money compared to the rental costs of larger cloud subscription models. A current example is a hybrid model featuring Microsoft Teams. In the course of the newly established home office culture caused by the global pandemic, many companies urgently required communication software such as Microsoft Teams to ensure internal communication throughout the crisis. However, Microsoft Teams is only available as a part of Microsoft 365. Microsoft Teams is already included in the E1 plan of the Microsoft 365 product family at a low monthly price. Combined with a pre-owned Office license, the E1 version including Teams can be used without restriction until 2023.
It becomes obvious that ITAM will undergo sustainable changes during and after COVID19. Pre-owned software will become a serious competition to new licenses. For those who urgently need cloud software for their daily work, hybrid models will become an easy and low-priced alternative. Pre-owned software will thus provide even greater support for companies to reduce their IT budgets and for the growing sustainability of ITAM.
When we’ve talked about the evolution of ITAM over the last couple of years, we talked about the move from cost optimisation and driving more value from technology to using technology intelligence to provide a better understanding of the interaction between people and technology. This is what helps us to drive value not only from the technology, but also from people – freeing them from repetitive and unproductive work and allowing them to add value through creativity and flexibility that machines alone can’t achieve.
In the wake (or more probably, the midst,) of COVID-19, IT organisations are trying to identify and cut waste and discretionary spending, as well as understanding the real business value of their technology investments. They need not just to survive the economic uncertainty ahead, but also protect their workforce from unemployment – as one general manager I spoke to this week told me:
“My business is dependent on the people – I need to find ways to retain them. If I have to let them go now and then later recruit replacements, I lose skills and experience and incur costs in terms of both redundancy and recruitment”.
Having the visibility and insights to understand where technology costs can be cut, or spending used to increase resilience, productivity, and profitability is key. No one can predict what’s going to happen. Despite all the ‘back to normal’ and ‘new normal’ talk, no one really knows what the implications of this virus are for our economies, political systems, societies, and businesses. Most individuals and organisations aren’t looking much more than 6 weeks ahead – there may be generic planning beyond that, but right now even 6 weeks feels like a long time given how much uncertainty there is and how much has changed from week to week.
We need to be ready to adapt, and understanding your landscape is essential. Innovation won’t stop, so be prepared for bigger evolutions that support specific needs as part of the response to COVID-19. While ITAM professionals are already aware of the accelerated move to the cloud, they may not have the same visibility of other changes. For example, the increase in interest in edge technologies, driven in part by remote working and in part by changes in the way businesses serve their customers as well as more automation via IoT devices and the use of AR/VR technologies for remote operation or improved collaboration. The recent launch of the Starlink satellites, and the rapid growth in 5G deployments are timely developments that indicate the sustainability of remote working which will improve as they support the move of workloads to the edge.
If ITAM professionals rise to the challenge, they can support their organisations with effective technology intelligence. This removes the need for individual stakeholders to invest in separate initiatives to gather insights about the hardware, software and services being used and the value that is derived from them.
It’s clear that ITAM has a large role to play in helping organisations take arms against the sea of immediate troubles and also in guiding them through challenges of the future – be they rising costs, audits, digital transformation, remote working, increased hardware requirements or, quite possibly, all the above.
If ITAM is not yet a strategic business function, now is the time to make it so. Use your insights, portfolio knowledge, licensing acumen, experience, and access to org-wide data to show how immediate business objectives like reducing costs can be achieved. Look back to 2008 and the years that followed for clues – where might your business suffer/find opportunities, what action might vendors take, what worked, and what didn’t. Use this to guide conversations and actions, both internally and with partners, and help your organisation survive, build, and grow going forward.
About Rich Gibbons
A Northerner renowned for his shirts, Rich is a big Hip-Hop head, and loves travel, football in general (specifically MUFC), baseball, Marvel, and reading as many books as possible. Finding ways to combine all of these with ITAM & software licensing is always fun!
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