What is Software Asset Management?
Software Asset Management (SAM) is a business practice that helps companies monitor their software inventory, ensure compliance with licensing agreements, reduce software spend by eliminating unnecessary software, and minimize risks associated with software misuse.
Available now!
Here are the points we cover in the SAM 101 Lightning Course:
- What is Software Asset Management (SAM)?
- Why is SAM important?
- Understanding software entitlement
- Software discovery & inventory
- Software license management
- Software asset lifecycle
- Successful SAM program characteristics
Access the SAM 101 Lightning Course slides
For any specific questions, feel free to reach out to us at info@anglepoint.com.
What is Software Asset Management (SAM)?
Access the SAM 101 Lightning Course slides
Software Asset Management (SAM) is a key business practice. It involves managing, controlling, optimizing, and maintaining software assets.
SAM aims to efficiently oversee software acquisition and deployment. Additionally, it covers utilization and maintenance. Its goal is to drive cost savings, ensure compliance, and improve decision-making.
SAM encompasses several key aspects. hese include software entitlement, discovery, inventory, and the software asset lifecycle. Beyond license tracking and device inventory management, SAM requires understanding software usage, its business relevance, and its operational impact.
Moreover, SAM involves collaboration across departments. It includes IT, finance, procurement, and product management. This cross-functional approach integrates relevant data points and fosters a mature and sustainable SAM program.
Contrary to misconceptions, SAM is not a one-time effort. It focuses beyond just saving money. While cost optimization is important, SAM also enhances security, improves governance, and mitigates risk.
Additionally, SAM doesn’t rely solely on software management tools. Even advanced tools won’t help if the process is broken and data quality is poor.
The benefits of software asset management are extensive. SAM provides a proactive approach to license compliance and risk mitigation. It also optimizes costs, improves IT efficiency, and enhances security and data protection. Furthermore, the process supports better governance and strategic decision-making. It involves understanding software usage patterns and aligning deployments with business needs.
Learn more about our SAM Managed Services.
Why is Software Asset Management important?
Now, we’ll explore why Software Asset Management (SAM) is crucial. We’ll cover several reasons to build and maintain an effective SAM program.
Firstly, cost optimization and savings take center stage. Organizations can save up to 30% of their software spend by implementing a robust SAM program, as supported by Gartner. Therefore, careful software investment and procurement drive business value and financial efficiency.
In addition, License compliance and risk mitigation are also crucial. and emerge as intertwined objectives. Since software usage is governed by licensing agreements, a well-structured SAM program ensures adherence to contractual terms. This approach minimizes risks and liabilities.
Enhanced IT resource management and productivity are additional benefits. A sustainable SAM program facilitates optimal resource allocation, ensuring that individuals are engaged in value-added tasks rather than operations. It also improves productivity by providing seamless access to necessary software.
Aligning SAM initiatives with organizational strategies is vital. This alignment ensures that the SAM program supports the company’s broader vision and priorities. Moreover, SAM enhances security and data protection by identifying and mitigating risks associated with outdated or unsupported software.
Furthermore, SAM spans several interconnected domains, including Technology Asset Management, IT Service Management, and Hardware Asset Management. Within SAM, software license management and compliance are critical. Measuring owned software against actual usage is essential.
Understanding Software Entitlement
Understanding software entitlement is crucial for effective Software Asset Management (SAM). Software entitlement refers to the rights and permissions granted for using specific software products. These entitlements come from the terms in software license agreements.
However, software entitlements involve more than just what appears on purchase orders or invoices. Key attributes include license type (e.g., subscription or perpetual), usage metrics (such as per user, per device, or per processor), geographic restrictions, use rights (production vs. non-production servers), and audit rights.
Measuring software entitlements is complex. It goes beyond raw purchasing data. A comprehensive approach is necessary, accounting for factors like mergers and acquisitions, different purchasing methods (direct from software vendors, through resellers, or via cloud marketplaces), and decentralized business unit purchases.
Software Discovery & Inventory
Building on the lesson about software entitlement, we now focus on license discovery and inventory, also known as license consumption management.
To start with, license consumption management ensures compliance with software license terms and conditions. Its primary goal is to prevent exceeding the number of purchased licenses. This is crucial as organizations scale and deploy software across numerous devices.
Next, the software discovery process uses specialized asset management tools to scan an organization’s network. These tools operate through agent-based or agent-less approaches, probing devices to gather essential information. Like knocking on doors in a neighborhood, SAM tools collect data about servers, workstations, and network equipment. They categorize attributes such as server type or installed software.
Accuracy and completeness of discovery data are critical. A low success rate in scanning can undermine data reliability, leading to inaccurate license consumption insights. Aim for at least a 95% discoverability rate.
Next, the inventory phase filters the collected data to isolate relevant and licensable software. Among the many entries in a computer’s “add or remove programs” list, only a few require license tracking. This process identifies software patterns and fingerprints to determine usage. Understanding the connection between software discovery, inventory, and license entitlement is essential for effective software asset management.
Software License Management
After establishing ownership through software entitlement and exploring license consumption, we now focus on software license management.
First, understand the significance of the Effective License Position (ELP), where ownership and consumption intersect. Start with contract discovery. Compile relevant contract documents to establish accurate license entitlement and usage rights. The goal is to extract an “entitlement position,” a detailed list of owned software and corresponding license quantities.
Next, conduct the “discovery” phase. This involves understanding deployments, consumption patterns, and generating a “consumption position” that details the licenses used and their measurement. The result is an ELP report, which contrasts owned licenses with those in use.
Automation and technology play a crucial role in simplifying the discovery and entitlement reconciliation processes. They facilitate real-time reporting, enabling informed business decisions.
In software license management, three interrelated realms exist: Consumed software, Entitled software, and Needed software. The objective is to align these realms for efficient software usage and licensing.
However, Misalignments often occur, making it challenging to perfectly align consumption, entitlement, and necessity. The video’s visual representation of three hypothetical boxes—Consumed, Entitled, and Needed software—illustrates this complex interplay. The goal is to achieve optimal alignment, enhancing cost savings and value generation.
Software Asset Management (SAM) is crucial in optimizing these alignments. SAM acts as an interpreter, bridging gaps between stakeholders and facilitating effective software management.
As organizations navigate dynamic IT landscapes and adopt cloud and SaaS solutions, SAM helps align software consumption, entitlement, and necessity efficiently.
Learn more about our Keys to Successful Software License Management.
Check out our Software License Management Services.
Understanding the Software Asset Lifecycle
Let’s discuss the software asset lifecycle. We’ve explored software asset management, entitlement, discovery, and license management. Now, we turn to a holistic view of software from inception to termination and its integration with key organizational processes.
First is the “Software Request” phase. Stakeholders or end-users identify software needs and follow a request process. This often involves user-friendly portals and standardized catalogs. For non-standard requests, an “Asset Acquisition Committee” evaluates them, considering cost, existing technology, and risk.
Next is the “Software Approval” phase. Timely and transparent workflows, whether automated or involving designated personnel, review and approve or deny software requests. This phase ensures alignment with budget constraints, organizational goals, security, and licensing requirements.
Following approval is the “Software Procurement” phase. Approved software is acquired through vendor selection, negotiating terms, and entitlement checks. Software asset management’s role is crucial here to verify available licenses before proceeding.
After the “Software Procurement” phase comes the “License Assignment and Deployment” phase. Acquired software is assigned to users, departments, or devices. This step ensures accountability, especially in chargeback models. The software is then deployed and installed to optimize efficiency and value.
The core phase is “Asset Management.” This phase focuses on monitoring and managing the software throughout its life. It involves tracking software movement, user changes, and compliance-related updates. Effective governance ensures adherence to licensing agreements and optimal resource utilization.
Finally, the “Software Retirement and Disposal” phase concludes the lifecycle. When software is no longer in use or reaches its end-of-life, it is uninstalled and removed from the environment.
Throughout the software asset lifecycle, the goal is to minimize time to value, ensuring efficient software access and discouraging bypasses of SAM processes. Continuous governance and tracking are essential for compliance.
For a deeper dive, check out our Lightning Course, The 6 Phases of the Software Asset Lifecycle.
Characteristics of a Successful SAM Program
Let’s address the key characteristics that define a successful Software Asset Management (SAM) program. We’ll focus on three critical components: people, process, and technology. Aligning these elements is crucial for creating a sustainable, efficient, and scalable IT Asset Management (ITAM) program.
First, consider the essential role of people. A knowledgeable team with proper executive sponsorship and an organizational structure aligned with objectives is vital. Effective processes are equally important. These should include policies, governance, and alignment with existing business processes to ensure seamless integration. Additionally, the right technology, such as software discovery tools and recognition systems, is crucial for efficient management.
Check out the graphic in the video, which illustrates the intricate web of stakeholders that a SAM function interacts with. It highlights the importance of harmonizing efforts across departments. Procurement, security, product owners, cloud management, and executive leadership all play pivotal roles in SAM’s success. A RACI (Responsible, Accountable, Consulted, Informed) chart is recommended to delineate each group’s responsibilities within the SAM framework.
The RACI chart is essential for streamlining SAM efforts, ensuring accountability, and avoiding task duplication. It addresses challenges arising from diverse leadership and teams, providing a structured approach to task execution and coordination. For optimal success, SAM must function as an integrated entity, aligned with various business functions.
In summary, without alignment among people, process, and technology, a SAM program will not reach its full potential. Collaboration and coordination across departments, supported by SAM tools like the RACI chart, are critical for success.
Next, explore how to create a business case for SAM to further enhance your program’s impact.
We hope this Software Asset Management 101 Lightning Course has been beneficial for your SAM journey. Apply these insights to improve your software asset management practices effectively..