Why Software Asset Management should matter to me: IT Directors

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1 Why Software Asset Management should matter to me: IT Directors Introduction...Implementing a software asset management process is beneficial for identifying and controlling software risks, a central component of good corporate governance, Juan Fernando Rivera, Corporate Director of Software Asset Management, Microsoft. Software asset management (SAM) is not simply about license compliance. Implementation of effective SAM processes demonstrates that yours is a responsible organisation with a commitment to good corporate governance. Effectively managing your software assets will help you: reduce costs control and allocate costs improve security improve corporate governance reduce business risk drive IT standards throughout your business Successful SAM begins with identifying what software assets you have, which of them are being used and reconciling them against your purchase records. You can then begin to identify security risks, license shortfalls or where you have over-purchased on software. But getting a true handle on the hardware attached to your network is problematic enough let alone identifying what software is actually loaded onto it. Effective software recognition can be tricky. Many inventory agents fail to recognise when applications have been deployed as part of a bundle (such as Microsoft Office). Having a clear understanding of this information is invaluable when negotiating new contracts with software vendors. This whitepaper discusses the benefits you can realise from implementing SAM, shows how Snow Software can help deliver these benefits and explains the key features you should look for in a good SAM solution.

2 Reducing Costs Measuring License Usage Many organisations are unable to categorically state what licenses they currently own; which of those licenses are actually being used or which specific software contract would be most suitable. Research shows that organisations failing to incorporate software inventory and usage data into their asset management processes will be out of compliance on 30% of their portfolio - and tend to overbuy licences for 60% of their portfolio. By tracking what software people are using - or not using and reassigning unused licenses, you can eliminate unnecessary purchases as well as avoid maintenance costs on unused applications. Enterprise Level Purchasing There are significant cost reductions to be gained by managing your software purchasing at a higher, enterprise level. Purchasing at a group, rather than at subsidiary company level, provides: greater scope to reassign unused licenses globally, meaning less wastage and no duplication of licenses greater economies of scale, meaning you can enter volume licensing discussions with vendors and resellers and achieve lower license costs improved contract management. A good SAM solution will provide group-wide visibility of all license contracts and allow you to allocate purchase records to those contracts. You can record objectives against each contract and at the end of the contract term you can assess whether these objectives have been met. However, local decisions will still have an impact on the enterprise s group-wide license costs. The ability to provide just-in-time SAM information across the organisation enables local purchasers to be incentivised and measured in delivering cost savings. Efficiency Savings A SAM solution will give you the ability to drive your IT standards throughout the enterprise - such as the use of a single application version. This will reduce version incompatibility issues resulting in savings in IT support time/cost. The ability to identify application versions and take advantage of vendors upgrade or downgrade offers, where appropriate, also offers cost saving opportunities. (These vendor offers provide the opportunity to upgrade applications at a significantly lower cost). Improving Cost Allocation and Control SAM gives you control of the licensing process. Knowing what applications you have installed and what applications are used, allows you to accurately budget and plan your future software purchases. Good SAM tools will allow you to replicate your organisational structure, with departments and cost centres (including importing your Microsoft Active Directory). This means you can track application installation and usage by cost centre - and then allocate costs by department - simply and accurately.

3 Life Cycle Management Managing your hardware assets over their complete life cycle offers significant opportunities to improve your cost control. Ensure your chosen SAM solution enables you to track the status of your hardware, the cost centre to which it is allocated and flag when any assets become inactive (e.g. because they are being serviced, in storage, have been sold or discarded). This will allow you to identify whether the applications loaded onto them can then be available for redistribution elsewhere in your business. Contract Management A good SAM solution will enable you to create a digital archive of documents, license proofs and agreements. This improves your control and will save you time both in ongoing administration and in the event of an external audit. Your SAM solution will also allow you to create alerts on your agreements and licenses which notify you when maintenance and other agreements are up for renewal. This ensures you to avoid renewing licenses unnecessarily. Improving IT Security Tracking the software on your network can also help dramatically improve network security. Security risks come in a variety of guises: data corruption and downtime posed by malware productivity and legal risks associated with unauthorised file sharing non-approved software installations browsers, operating systems and office productivity applications are regularly targeted by hackers the presence of large quantities of unwanted files (MP3s, JPGs and other non-business documents) can point to wider security and productivity issues Organisations with a full and up-to-date software and hardware inventory (as provided by a quality SAM solution) will enjoy significantly enhanced network security. Enhancing Corporate Governance SAM provides several key benefits for improving your corporate governance: 1. risk mitigation. Thanks to the legal principle of vicarious liability, your organisation is legally responsible for nearly every action that employees perform on (or from) your network - even if that employee was not authorised to carry out the action in question! A frightening thought. Tightening control of what users can and can t do therefore provides obvious benefits. 2. license compliance. Unlicensed software exists on the vast majority of corporate networks despite the belief of many companies that they are 100% compliant. Many managers believe that the risk posed by

4 this software is not significant enough to worry about; or the risk of a vendor audit is minimal. However, software vendors are getting tougher on license compliance and, together with industry watchdogs are becoming increasingly stringent about prosecuting offending organisations. Record fines have recently been levied. 3. improved financial security. SAM helps you to eliminate unexpected licensing or compliance costs and to take advantage of tax benefits associated with asset depreciation. 4. improved business-related functions. Comprehensive software asset control improves support operations (they know exactly what is on the system); improves product development and reduces time to market (improving functionality and productivity); enables faster and easier mergers, acquisitions, business consolidations or expansions. According to BSA (Business Software Alliance) figures, it can cost organisations more than twice as much to become compliant than to buy the right number of licenses in the first place. And that doesn t include potential criminal penalties (including jail time) if the non-compliance is extensive and intentional. Sarbanes Oxley The Sarbanes Oxley Act was implemented in the USA in 2002 following corporate financial scandals such as Enron and Worldcom. The Sarbanes Oxley Act (SOX) affects public U.S. companies and non-u.s. companies with a U.S. presence. A European Union version of Sarbanes Oxley, called Euro-SOX, is active from 1 st July SOX is all about corporate governance and financial disclosure, with provisions for non-compliance including criminal and civil penalties. Correct management, control and reporting of assets - including software assets - is encompassed within SOX. Knowing exactly what s on your network allows you to focus more on running the business rather than trying to keep up with IT systems - a positive step for any corporate governance effort. Compliance with ISO ISO/IEC is a two-part international standard developed to help organisations manage their software assets effectively. The standard breaks down the processes into three key areas: Organisational Management Processes, Core SAM Processes and Primary Process Interfaces. ISO/IEC Part 1 Describes the processes required for the effective management of software and related assets. (Published 9 May 2006). ISO/IEC Part 2 Will present an industry-wide standard for the data required to identify software assets, thus enabling better software asset management. (Yet to be published). ISO/IEC is not just about audits and software compliance - although these are important components. The standard defines an extensive framework for the effective management of your software estate and related IT assets. The standard allows senior executives to prove that their business is carrying out effective software asset management to a level sufficient to satisfy corporate governance requirements such as Sarbanes Oxley.

5 Regardless of whether or not you wish to seek accreditation, by implementing the standard you will gain the key benefits of SAM: controlling and reducing costs; lessening business risk; improving corporate governance. Implementing a SAM solution It s easy to be wary of SAM because of the project s perceived enormity. Thankfully, the reality is quite different. So where do you start? STAGE 1: Usually SAM implementation projects are controlled by your organisation s IT function and the first step is always a comprehensive software and hardware inventory. Only by knowing how many devices (desktops, laptops and servers) your organisation has and the programs installed on them, can you decide what changes would best suit your business requirements. A good SAM tool, such as Snow Software, will be able to handle this discovery process automatically in all environments - both on and offline, local and remote, over Thin Client (Citrix, MS Terminal Server) and be compatible with MS, Apple and Linux. Plus, it will recognise where applications have been installed as part of software bundles (such as Microsoft Office). An accurate inventory will help administrators establish the following baselines: Is the company using the most recent versions of the programs it needs? Does the company have any unused programs that can be removed? Does the company have a licensing shortfall on any applications? Are any PCs or laptops unused? Does every employee have the software they need? Are employees regularly using the software installed on their machine? STAGE 2: Following the discovery' process, which builds a global view of all your software and hardware assets, the next stage is to reconcile the applications deployed on your network against the physical licenses you have purchased. Snow Software has numerous built-in compliance reports that help software asset managers accurately understand their current compliance position - or bespoke reports can easily be created. Snow s compliance reports are accepted by BSA, SIIA and Microsoft. Key questions your SAM tool will answer: 1. Does my software usage exceed my current license entitlements? 2. How much software is out of use and can be deleted? 3. Are there unused licenses that can be reassigned to other users? 4. Is the organisation running multiple versions of an application, leading to incompatibility issues and increased IT support costs? 5. If we are running multiple application versions, can we access a vendor upgrade or downgrade offer to save costs? 6. Is the organisation getting best value from its current software Contracts?

6 This reconciliation process can either be handled by you in-house, or with the help of your SAM solution provider. While this initial reconciliation stage can be quite time-consuming, it provides a perfect opportunity to complete the set up of your SAM tool in preparation for Stage 3. While you undertake reconciliation, you can create your digital archive of license proofs, specify your SAM rules and alerts, import your organisational/cost-code structure, etc. Investing a little more time to complete these tasks at Stage 2 will save you additional time and cost at Stage 3. STAGE 3: Following your initial reconciliation and achievement of licence compliance, ongoing management will maintain your compliance and deliver software license savings. This involves the definition and implementation of license strategies, establishing efficient license procurement routines and regular management reporting. By tracking ongoing software usage, you can decide when to remove redundant software, when to redeploy applications and even whether or not to renew maintenance contracts. You ll enjoy the confidence of being in control, and knowing you can stay that way, by re-auditing at any time with no disruption to productivity. Flexible reporting and software change alerts will help you to make sure that you stay compliant. Having proved your compliance, your SAM tool will support your license negotiations with vendors by providing accurate information which allows you to negotiate from a position of knowledge. From a cost reduction perspective, this is the most important stage of the process. While the other two stages provide control and compliance, Stage 3 gives you the means to actually lower your license costs. Management and Reporting As well as allowing you to automatically locate and account for all the software that is loaded and used throughout your organisation, a SAM tool will provide multi-departmental access to license usage information. For example, Snow Software s role-based security access allows managers from different functions IT, Purchasing, Finance, Compliance, etc. to access the license management information they need, via a web-based portal. Snow also offers you the ability to create a multi-level cost centre structure for your organisation (including replication of your Microsoft Active Directory) so costs for hardware, software and licenses can be allocated appropriately to department or cost centre. Summary Software asset management is an important part of best practice corporate governance. Treating software as an asset has many benefits for your organisation - from cost reduction, cost control and security, to corporate governance and compliance. Snow Software allows you to gain a clear picture of what software (and hardware) is on your network at any given point in time. Plus, using a tool like Snow to take a proactive approach to managing your software investment promises significant ongoing efficiencies across your organisation.

7 About Snow Software Snow Software is a market-leading vendor of Software Asset Management solutions. Our mission is to enable companies to take control over, and gain maximum value from, their hardware and software assets. Snow s product range helps organisations to publish, deploy, maintain, track and manage installed software and licenses - throughout the entire hardware life cycle. Snow has been instrumental in driving the ISO/IEC best practice standard for SAM. Snow License Manager provides automatic identification, auditing and tracking of software and hardware assets, across multiple platforms and geographies. This allows you to quickly pinpoint the steps you need to take to achieve license compliance, maintain it on an ongoing basis and reduce your license spending. Snow s unique software recognition repository and global update service ensures you always know exactly what is on your network, where it is installed and how it is being used. Snow License Manager uses data collected via Snow Inventory (see below) or an alternative tool such as Microsoft SMS. Snow Distribution provides software packaging and software distribution, including de-installation. It enables you to make those license savings real, while helping you preserve and improve your IT standards. Snow Distribution is one of the only solutions designed to support and dynamically assign assets as they change configuration and move around your enterprise. It allows you to deliver applications just-in-time as they are needed, across all common enterprise platforms. Snow Inventory is a tool which collects data from diverse environments across an IT community. The collected data is accessed through a user-friendly console where IT managers or administrators can access all information relating to the hardware and software on individual PCs/ Macs/Thin clients. Comprehensive search and filtering functions enable drill down to areas such as service pack, memory status, upgrade ability, etc. Historic data such as moves, additions and changes are stored to help administrators trouble-shoot problems. Snow Inventory also allows certain unwanted applications to be black-listed and provides full control over the server and workstation environment. With an impressive array of customers around the world, including blue-chip organisations and government departments, Snow Software products are available through a global network of resellers and market-leading OEM vendors. Contact us for more information Web site Telephone +44 (0) uksales@snowsoftware.com