What is Software Asset Management?

What is Software Asset Management?

Software asset management is a crucial part of any organization today. It has to do with the procurement, utilization, maintenance, and disposal of systems software that are used to run daily tasks of business. According to Deloitte, software-related expenditures constitute 20–40% of IT budgets in most organizations. Therefore, software asset management is especially applicable to technology firms that make extensive use of IT software and hardware devices.

A well-grounded software asset management program keeps you ahead of your schedule and streamlines the monitoring of software assets. It also has a positive impact on the overall performance of a company.

Why does your business need software asset management?

Software asset management comes in super handy for removing daily functional roadblocks that arise in a business. It not only helps improve the usage of associated hardware but also alerts for timely upgrades. This trickles down to a company saving substantial costs when it comes to both hardware and software assets.

If not armed with a software asset management program, businesses may face some crippling challenges.

1. Legal liabilities

Regulatory authorities have become extra wary of companies that use unlicensed software products. In the absence of a software asset management program, it is hard to keep track of expired licenses or required software upgrades. Many software systems even end up futile if not upgraded to recent versions or serviced in time.

If businesses do not renew their expired licenses, they may be held legally liable by regulatory authorities for non-compliance. The costs of such lawsuits can be huge!

2. Inaccurate data

Inaccurate data

It is a common practice for companies to store their asset data on cloud-based software systems today. An absence of software asset management and reliance on manual outdated tactics for data-keeping can really pull you down. This means you do not have access to real-time accurate data.

Inaccurate statistics can affect your decision-making capability and lead you to some serious management disasters.

3. Strained relations with vendors

Keeping healthy relations with your suppliers is just as important as running a successful business. Without proper insights into software utilization, it becomes hard to negotiate with vendors about what you want.

A poor software asset management system means limited knowledge about software specifications and its maintenance requirements. This hinders your communication with software vendors and only creates confusion if you do not get what you need.

4. Inaccurate procurement planning

You may not be able to correctly determine your software expenses if you do not have a system that tracks their usage history or demand patterns. Inaccurate procurement planning can run you out of budget if you invest in unnecessary software systems. You may even lag behind your competitors if you do not stock up with the latest software systems used in the market.

Key software asset management features

Laying a robust software asset management routine is necessary if you work with various types of software solutions. It comes with multiple benefits to optimize the performance of your software assets.

1. It keeps software details on your fingertips

It keeps software details on your fingertips

It is ideal to have a detailed database of software specifications to make the best use of your software assets. Software asset management programs give you a centralized database to clock in important asset and vendor information. This may include product codes, date of purchase, current version, and various other specifications.

It allows your employees to retrieve solutions as needed by simply clocking in the relevant specifications. Whenever you’re deciding on a software solution to do a job, just type in the specifications you’re looking for and you get the required solution in no time.

An accurate information system also highlights your procurement needs. You can always check with the existing software inventory and decide which assets you want to purchase.

2. It integrates with service desks to report and track maintenance

Businesses have multiple users and devices using the same servers and back-end software systems. This can sometimes cause servers to go down or systems to develop glitches due to extra strain. Such delays can slow down your daily operations. To avoid them, it is important to schedule your software systems for regular service events.

Most software asset management systems can be integrated with servicing and ticketing solutions like Zendesk and Jira. This allows you to communicate software servicing to employees who use them and track service events as they happen.

Once this is done, you can notify the users to start using the serviced software assets again. Regular servicing drastically improves the functionality of your software assets.

3. It records the usage of software assets

Organizations often struggle to meet transparency in daily workflows. Failure to do so can make it hard to monitor the usage and ownership of intangible assets. An automated software asset management system allows you to keep tabs on which software solutions are being used the most and by which department.

You can keep a trail of user logins and subscriptions to see which software assets are high in demand. This helps you design a robust software procurement plan so you only invest in system solutions that add value to your business.

4. It allows you to run audits for software applications

It allows you to run audits for software applications

Like tangible assets, software systems are also susceptible to misuse by employees for fraudulent activities. For this reason, they should be guarded against embezzlement. It is a common practice for businesses to run software audits and software asset management greatly assists with it.

Since you have access to which users are using a software system for what activities, you know whether the deployed software is used the right way.

A software asset management system also allows you to run license and compliance audits. Here are a couple of best practices you should follow.

  • Adopt a proactive stance: Before you receive a notification to carry out an audit, prepare yourself by having a thorough inspection of all software assets. Contact the vendors to get the necessary settlements as soon as possible.
  • Carry out periodic in-house audits: the key to attaining software compliance regulation is to hold frequent internal audits. At a minimum, self-audits should be conducted twice a year and even more if the company size is large.
  • Communicate with vendors: Having support from software providers is extremely critical to ensure a smoother audit process. Constant feedback from vendors helps adhere to the software compliance rules.

5. It alerts you for license and warranty renewals

Software systems are of no use if they are not upgraded to the latest versions in time or if their licenses expire. According to research, 68% of companies experience license shortages, i.e. unknowingly use software with an expired license. With a software asset management system by your side, you can clock in the purchase, and license and warranty renewal date in the database. It automatically notifies you when your warranty period is about to expire so you can apply for renewals. It significantly cuts down the cost of license breach lawsuits.

Benefits of software asset management

A robust software asset management strategy can assist your business in achieving several benefits. Below, we list some of these.

1. Improved visibility

Dedicated software asset management offers a transparent view of your software assets through in-depth analysis and custom reports. You can track important information such as license compliance status, contract renewal dates, operational KPIs, and compliance milestones to avoid penalties by external audits.

With a top-of-the-line software asset management tool, you can get intuitive dashboards that provide you a clear picture of key events like contract expiry, use of unauthorized software, etc., hence allowing you to take appropriate and timely action.

2. Reduced costs

Reduced costs

By Properly utilizing the software and eliminating the maintenance of unused licenses, you can save money and plan your future spend accordingly. You can also downgrade your license seats and save overhead costs on surplus licenses whenever employees are offboarded or the software is no longer needed as before.

3. Optimized license usage

By allocating and provisioning software based on usage guidelines and application of entitlements, you can ensure that you are not paying for surplus licenses. Proper utilization of IT assets also enables accurate procurement forecasting, thereby reducing overspending and optimizing the use of existing assets in your organization.

4. Robust compliance and governance

With efficient software asset management, you can eliminate software piracy, make internal audits more streamlined, adopt strict IT security policies, and track actual software usage. You can also ensure that your employees are adhering to legal and regulatory requirements while using the software.

For instance, a smart software asset management tool will enable you to easily identify relevant issues that can lead to a leak of employee data and ultimately, the breach of GDPR policy. Software asset management helps in preventing such breaches and the associated heavy financial penalties.

5. Improved efficiency

By adopting a software asset management strategy, you can automate various processes related to your software assets and observe the enhanced productivity of IT support/service desk operations. This helps your IT teams to focus on improving their core business value while accurately tracking vital software and hardware information.

Key software asset management best practices

Key software asset management best practices

Read more: Software Asset Management: 7 Features You Should Look Out For In a Tool

About AssetSonar

AssetSonar is the leading cloud-based software asset management tool with endpoint management, software license tracking, hardware lifecycle management, and reporting capabilities to help you reduce your tech spending and get the maximum out of your IT budget.

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