Within the IT department, software asset management is easily overlooked. Which means that SAMs rarely get the recognition, support or resources, they deserve (and need).
Software asset management used to be indistinguishable from inventory control, a pseudo-finance role that ensured license counts matched requirements. But the role has – and continues – to evolve. Where one manager could perform the necessary counts, there is now a team of specialists to cover the many vendors and licensing models that apply to your business, especially as cloud platforms grow in strategic importance.
As IT Asset Management Magazine noted;
‘Although today cloud is considered by many to be beyond the core remit of SAM and ITAM teams, we are seeing the situation change rapidly as cloud software and infrastructure investments consume a larger portion of an organization’s overall technology spend. ITAM professionals with an understanding of how to create and enforce cloud governance functions will continue to demand a premium. But organizations also need to invest in the right technologies and services to better control their cloud spend. As with the more traditional areas of ITAM, you still need a careful blend of people, processes and technology.’
Heading up the software asset management team requires a broad range of skills. Here are seven distinct roles that the SAM fulfills – simultaneously.
SAMs as finance managers
SAMs have always been responsible for a budget, buying new licenses to cover changes in software usage. But changes to the way in which software is purchased and licensed have made financial management more fluid – and complicated.
The increasing complexity of managing software assets is exposed by growth in the market for solutions to simplify the task. A report published by ResearchandMarkets.com found that the software asset management market was worth USD $1.16 billion in 2017. The market is projected to double in size, reaching USD $2.32 billion by 2022.
In some ways the rise of Software as a Service and its per seat licensing model has been useful for controlling costs. But at the same time, administrative overheads have increased as the SAM team must maintain closer oversight of user headcount to adjust licensing volumes accordingly.
Complexity increases further with regards to scalable on-demand cloud services. Cloud platforms like Microsoft Azure and Amazon AWS allow for instant expansion of resources to match demand. Billed on a metered per-use basis however, SAMs much work closely with CTOs to ensure that resources are properly costed, and limits introduced to prevent unbudgeted resource increases.
SAMs as negotiators
As well as costing license purchases, the SAM is expected to negotiate the best possible rates with OEMs and VARs. These negotiations can have far-reaching consequences for the business, potentially saving millions of dollars over the course of a maintenance agreement.
In larger organizations, negotiations may be handled by the procurement manager. Even if the SAM is absent from pricing negotiations, they are still expected to carry out the necessary research to inform procurement. The procurement manager is also relying on the SAM to outline expected outcomes, costs, and to define the parameters of discussions with the vendor.
It’s not just other managers that the SAM needs to deal with either. The BYOD revolution is showing no signs of slowing or reversing, which adds another layer of complexity to the corporate IT environment. SAMs now have the added headache of ensuring employees have access to key business apps on their personal smartphones and tablets. They also need to negotiate carefully with end users and policy makers to limit the use of unlicensed, unapproved apps for business services. Unless the SAM can negotiate agreements with device owners about acceptable app use, the business could be exposed to fines following an OEM audit – even though they don’t own the physical devices in question.
SAMs as political peacemakers
The role of software asset manager is becoming more visible, with SAMs expected to play the role of a politician. They are expected to balance the competing needs of each business unit to fit the constraints of their software budgets.
Often this means playing peacemaker to those managers who will have their requests for licenses denied due to financial restrictions. SAMs may find themselves drawn into negotiations with stakeholders, agreeing to delay or reduce spend in one unit, on the understanding that a competing purchase is prioritized in the next budget.
The role becomes even more political during mergers and acquisitions. SAMs may receive a larger budget, but they are also expected to satisfy even more demands. Standardizing software across subsidiaries is a political nightmare – particularly if it involves replacing systems that are known and trusted. Technically this is an issue for the CIO, but the SAM will inevitably be drawn into discussions – and they will have to defuse those situations for the good of all stakeholders.
SAMs as business strategists
The contemporary digitally-driven organization is heavily reliant on its software assets. Unsurprisingly, the SAM is expected to help optimize license deployments to help meet the strategic goals of other business units.
The SAM is also expected to analyze and understand the needs, usage and effectiveness of every application – including those not yet in use by the business. This understanding of applications, known and unknown, is crucial to planning and executing software projects. Especially if it involves redeploying and migrating licenses in use elsewhere in the business.
The shift towards cloud computing requires a change of mindset at every level of the business. We’ve already mentioned the financial implications of changing licensing models, but the methods for auditing use and recording entitlements will also need to evolve, further complicating the job of the SAM. They will need to play an active role in shaping cloud strategy if your business intends to contain its costs and avoid wasting the gains realized from hosted IT platforms.
Operating within their sphere of expertise, SAMs may need to begin thinking outside the box if they are to meet their budgetary targets. This requires a willingness to look outside the same old way of working and embracing alternatives – such as third-party software maintenance contracts – to lower costs without affecting the quality of support they receive.
These decisions are strategic in nature – you’re relying on a third party to assume control of a potentially critical corporate asset. Again, the SAM will need to draw upon their diplomatic and political skills to present (and win) potentially difficult arguments about the strategic future of your software.
SAMs as detectives
The organic growth of corporate networks has, in the past, been relatively uncontrolled. Software acquisition has been piecemeal, and record keeping is often less than stellar, creating gaps and question marks over license coverage.
This is particularly true where the role of SAM has been occupied by several previous incumbents. All too often vital details like licensing portal logons are held in the memory of the SAM, and never captured when they move on. In order to properly discharge their duties, the SAM needs to play detective, chasing down the information that gives them a true understanding of application usage and software coverage.
The environment becomes even more complex following mergers and acquisitions. Now the software asset manager must track down licensing details across even more touch points. The process is complex and time-consuming, and often deadline sensitive – renewal negotiations hinge on an accurate license count, particularly when trying to secure the maximum volume discount.
SAMs as life-cycle managers
Originally, software asset managers simply monitored application usage and arranged for the purchase of new licenses whenever a potential shortfall was detected. Software strategy was driven by the OEM and their upgrade cycles as much as the business demands.
But as software use has changed, the SAM is now fully involved with managing the entire life-cycle of each software asset. From purchase to retirement, SAMs are expected to feed into strategy, and to closely manage costs at every stage. Because of their knowledge and experience of software life-cycles, the SAM will play a key role in future system development planning.
SAMs as internal auditors
Vendor license audits are an inevitability – and the responsibility for passing (or more likely failing) these checks rests squarely on the SAM. They almost certainly maintain a register that is mostly accurate – but that is unlikely to satisfy an external auditor who stands to make a percentage on any licensing shortfalls they discover. Consequently, SAMs need to take a more strategic approach to audit.
The SAM is expected to conduct their own routine license audits to confirm their records are accurate. Again, this task is part detective, part accountant, trawling through in-house records, and supplier portals to obtain an understanding of entitlements. Then carrying out an audit of software installs to identify – and rectify – shortfalls.
If (when) an OEM software audit uncovers discrepancies and shortfalls, the SAM is expected to defend the company. The manager will have to present credible evidence to show the business is operating within its licensing entitlements – which means having the relevant information available before the audit begins.
The audits will also inform corporate software strategy. More than simply maintaining a count of licenses, the SAM will track application usage. This will help to identify where applications are under-used, offering the opportunity to cancel certain maintenance contracts entirely, or to redeploy licenses and installs to where they will be used. The SAM is at work ensuring employees and stakeholders have the tools they need – and cutting off any unwanted excess.
To be clear, auditing is now about tracking software use as well as license count.
The role has changed – and SAMs need assistance
It would be unfair to say that software asset managers were historically little more than stock controllers. But it is true that the role has evolved to become almost unrecognizable from its roots.
Software asset managers are now consummate, well-rounded professionals who need to work at all levels of the business to maintain compliance and contain software costs. As well as an attention to detail, they must be able to work with disparate groups of people to build consensus and agreement – and to keep software-driven operations aligned with strategy.
For some organizations who have had a SAM in post for many years, this change in role may present a problem. Undoubtedly excellent at maintaining license counts, incumbents will benefit from additional training and assistance to give them the additional skills required to meet all of the demands expected of the post holder.
With so many stakeholders, SAMs also require greater sponsorship and support from the IT manager and other stakeholders, including the C Suite and finance managers. The Software Asset Management - Mitigating Risk and Realizing Opportunities report from KPMG highlighted a common theme from non-SAMs, “why should we as end users invest in systems and processes to make sure software publishers are getting paid?”
The reality is that passing a software audit will avoid multi-million dollar costs (fines + additional licenses + maintenance and support coverage) and that will have a bearing on whether you are able to fund all of your strategic IT projects this year or not. There is a clear case for properly resourcing the SAM with access to asset management tools and consultancy services if it generates significant savings in the longer term.
Indeed, if a business is serious about controlling, or lowering, licensing costs, they will need to invest in their IT asset management (ITAM) provisions. Because the way that the IT industry is headed, this job is about to get harder still.