22 March 2016
Industry research leaders, Gartner, have found that CIO's are increasingly becoming hands-on with Software Asset Management (SAM).
SAM is no longer considered a tactical mid-level management activity.
A recent Gartner survey has found that 27% those responsibile for SAM are now in C-level roles - made up of CEO, CIO, CFO, CTO; and a further 79% of individuals responsible are direct reports to a C-level position.
"The combined impact of increased business reliance on IT, increasing software spend and risk of non-compliance or escalating costs, gives rise to a heightened need for SAM governance, processes and controls."
Software costs are growing at an increasing rate
Software spending is increasing and has become increasingly visible.
Where once software costs were purely an IT issue - and did not generally exceed hardware/resource costs - they have grown disproportionately in relation to other budgetary items.
Hardware costs have dropped dramatically as processing power has increased, while increasing complexity and growth in the business contribution made by software has led to increasing software costs.
Business dependence on IT has caused leaders to shift from seeing it as an enabler of operational efficiency to recognising it as a critical business intelligence resource
Cloud adds to need for SAM
Gartner predicts that, by 2017, 75% of cloud acquisition will be unapproved and untracked.
The increasing standardisation of hardware platforms and the disappearance, in many cases, of the need for skilled technical support to carry out initial installation and setup have made it easier for business users to source software directly, without initial involvement by IT.
Without appropriate SAM solutions in place, IT will be made aware of these cloud investments only when integration is required, or when issues arise with the technology, the contract, or the costs that cause SaaS business users to engage with IT to help solve a problem.
Gartner is also predicting by 2019 cloud computing and the new digital economy will cause subscription pricing to overtake perpetual licensing and maintenance.
The increased complexity and volume of software user environments are leading IT leaders to broaden the scope of SAM and implement it as a governance function to enable IT to manage the full software life cycle effectively.
Vendor audit activity demanding compliance
On average 68% of the respondents to Gartner surveys over the past six years have been audited by software vendors each year.
CIOs, technology procurement managers, software asset managers, vendor managers and finance managers are all under pressure to minimise the operational and financial impact of software audits.
"Outcomes of vendor audits may include demands for unbudgeted spend - additional licence purchases, payment of back maintenance, payment for the cost of the audit and even interest payments."
Top 3 Reasons for Investing in Software Asset Management
The Gartner survey shows the top three reasons for investing in SAM are:
- 53% Improve IT processes and deliver better services to clients
- 49% Better align software strategy and needs with business initiatives
- 41% Improve software compliance and ability to respond to software audits
VoicePlus Atrium+ solution integrates software asset management into its IT Asset Management module.
Extracted from Gartner Research Note published 3 March 2016
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