You know it is a funny fact, we know where the hardware is (at least
most of it) and what it is used for. It is tagged, classified, part of the
asset register with clearly defined depreciation rules and possible refresh
when it reaches end of life. The same does not always apply to software
licenses; software is bought in varied forms, box packs, paper licenses, and
enterprise agreements, downloads, handed over on a disk or thumb drive. It’s
all over the place with most clueless of where, what, how much, and changing
licensing conditions.
We help companies save
license costs, manage their software inventory effectively towards compliance
and ensure that there are no surprises during renewals or audits. Said so a representative from a
large global IT advisory company to an audience of CIOs. He offered data and
metrics to the disbelievers on how they helped many companies. Consulting
companies have been pitching that everyone has a lot more licenses than they
need; rarely anyone creates an inventory of all the software they buy, deploy
and retire.
Software vendor representatives in the room nodded away through the
sales pitch adding that most CIOs do not look at license compliance actively;
it is an afterthought and enterprises need to deploy tools to manage the
process of license management. Collectively they incited the CIOs to deploy SAM
or software asset management. While a couple of CIOs from IT and software
development companies talked about the benefits of SAM and how they were able
to improve margins, rest of the CIO audience could not connect.
A FMCG CIO interrupted: when IT is your business and software the tools
of the trade, they are managed as well as the machines that define the assembly
line in a manufacturing organization. We
know where the finished products that move across the supply chain are the same
way you know about your tools and services. We are users of IT to run our
business; IT is not our business and we need simpler licensing when compared to
the current complexity that makes it impossible to keep track of the ever
changing environment and terms and conditions.
Life in the software industry started with the simplest of forms such as
enterprise license for the entire company which gradually moved to concurrent
users, named users, and then by server. Later arrived licenses by CPU which
soon changed to Core based licensing. Advent of Virtualization created some
confusion which was compounded by the Cloud. My software is licensed to run
only on physical servers; if you want virtual servers you can only run it on my
technology stack. Some innovative guy added memory based licenses.
Mergers and acquisitions in the software industry made life even more
interesting with products morphing from one avatar to another, SKU changes,
changes in terms and conditions, or licensing models. In many cases these were
updated on respective websites and customers expected to periodically check ! Refer
to clause on page 179, sub-clause … you signed that enterprise user licensing
agreement agreeing to this. It would be good for you to also take cognizance of
the inflation clause which raises annuity payments every year.
Unable to stop himself, a veteran CIO asked the audience: I am sure all of you have account managers
from the software companies who meet with you frequently; has anyone of them
ever engaged with you or offered help to stay compliant with the licenses ? Is
there role only to sell more solutions or also to help you leverage what you
have and work collaboratively to keep the relationship going ? Why do we CIOs
have to face audits like criminals and then get cornered for small aberrations
or use beyond the licenses ?
Acknowledging the gap the vendors and the consultants in the room
mentioned the need for SAM and why it is important for companies to stay
abreast of their licensing. I believe that depending on the size of the enterprise
and the complexity of the architecture it would be worth getting hands dirty on
SAM. Until the industry learns and decides to work with CIOs on managing
licenses, the onus shall remain with the IT teams to stay compliant with
process driven provisioning and frequent internal assessments that rationalize
use.
