At the Gartner IT Financial, Procurement & Asset Management Summit last month in Orlando, FL, Bill Snyder (the conference chair) shared interesting data from a recent survey of IT Asset Management (ITAM) projects. This has been followed up with the publication of a more complete research study report. It appears to be the largest study of its kind to date. Key findings included that ITAM programs were successful, but not always measured first in financial terms, and that they were becoming increasingly important. While many in the industry may have sensed this pattern, it’s great to see supporting data across so many companies.
First, a definition: Gartner defines IT Asset Management as “a framework and set of processes for strategically tracking and managing the financial, physical, licensing and contractual aspects of IT assets through their life cycle.” This definition includes the field of software asset management (SAM).
ITAM Success – IT asset management programs have delivered against expectations. According to the Gartner study, the vast majority of organizations that establish ITAM programs are “satisfied or extremely satisfied with the results”. This is good news, both for those organizations reporting on their results and other organizations that are just starting out. It justifies the high percentage of companies that are expanding or beginning their ITAM programs. It begs the question, though, what were those companies expecting—what were their ITAM program objectives, and how might those expectations/objectives evolve in going to the next stage of value and maturity?
Measures of Success – The measures of success are not always cost reduction. In fact many companies just starting out do not measure on this dimension at all, but are instead seeking control over their IT assets. On an industry-wide basis, this risk avoidance and management function is just as a compelling a rationale to get started with an IT asset management project. Those who did measure cost savings reported benefits of more than 5% in the first year, with 42% of respondents saving 10% or more. For those who did not measure cost savings initially, as their ITAM program matures, financial components increasingly come into play. This is consistent with the evolution we have seen in the form of a focus on software identification first, then on reclaimed, redirected, or deferred software license spend, and then on the ability to optimize license spend on an ongoing basis. See the software license optimization maturity model for more details on this progression.
Increased Importance – One indication of the importance of the ITAM programs is that ITAM information is increasingly being used to make more strategic decisions. The report states that 28% of organizations are using ITAM data to support financial management and IT strategies. Another indication of the importance of ITAM programs is that IT asset managers predominantly report to CIOs. This is a shift from the past, and highlights both the level of risk that can be mitigated through ITAM programs and the financial implications of these programs. These indicate that ITAM programs require and warrant executive-level attention.
The costs associated with IT assets and their strategic value to the enterprise, especially for software assets, is high and increasing. With the success reported to date, it’s not surprising that the focus on IT asset management and then financial optimization is also increasing.
How do these sorts of reports impact IT asset management programs in your organization?