Software License Optimization

Flexera Software's Vincent Smyth Discusses IT Outsourcing

By John Lipsey

IT outsourcing is an increasingly common strategy that enterprises choose to increase flexibility and gain cost management advantages, ideally without compromising the quality of service.  However, there are software asset management implications that enterprises should understand before choosing IT outsourcing .  First and foremost, while responsibility for managing software assets may be shifted to the outsourcer – the liability for license non-compliance if that company gets audited, generally does not.  In most cases, the enterprise still owns the software licenses and bears the license compliance risk. This can create some natural tensions between the enterprise and IT outsourcer.

Vincent Smyth, Flexera Software vice president, EMEA, discusses what enterprises can do to understand the potential software asset management risks of IT outsourcing, and how to minimize those risks.

 

 

 

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WEBINAR: Software License and Contract Management

By John Emmitt

Achieving and maintaining software license compliance ensures that your organization is ready for software audits and can avoid unbudgeted true-up expenses.

 

Webinar Date and Time:

Date: Tuesday, 7th February, 2012
Time: 10:00 am PT | 12:00 pm CT | 1:00 pm ET

Register Here

Join Flexera Software for a Webinar on Software License and Contract Management to learn how your organization can proactively manage software contracts and maintain continuous license compliance. Now that you know what’s installed in your IT environment the next step is reconciliation against your license entitlements.

We will discuss the use of Stock Keeping Units (SKUs) to help automate the process of reconciling purchase order information with software inventory to calculate your license position.

Attend this Webinar to learn about:

• How to automate license reconciliation using SKUs
• Software contract management—keep track of key dates to negotiate better deals
• How to achieve continuous license compliance and audit readiness

Speaker:

Cyndi Tackett is Manager of Sales Engineering for Flexera Software's software license optimization business.  Cyndi works with customers to understand their business challenges associated with software asset management and assists enterprise organizations with successfully implementing processes and solutions to solve their business problems. Cyndi has over 10 years of experience working with companies to optimize their software license spend and reduce ongoing costs associated with applications.

 

This Webinar is the 3rd of a 4-part Webinar series on how to get to the highest level of software asset and license management optimization. Please plan to join us for the final Webinar in the series: Strategies for Optimized License Management on February 29, 2012.

Inventory data requirements for software license management

By Vincent Brasseur

Inventory data for hardware and software assets is one of the primary data feeds for software license management. It consists in accurately determining which software products are installed and used on each device. License management also requires contextual data: on which devices is the software installed and/or running? What are the properties of the hardware devices where the applications are installed? How are the applications accessed? For instance, are they executed from a local installation, are they virtualized applications, are they installed on a virtual machine (VM), or are they Web applications? To answer these questions, we need to also collect information about the hardware devices and virtual environment.

Software Application Recognition

The identification of software products installed on each device is usually performed by considering multiple installation evidence types found on the hard disk. Most publishers will de facto register their applications by using a packaging technology that will locally store information about the software product. For example, within Program and Features on Windows devices (Add/Remove Programs on old releases) or RPM (RedHat Packaging Manager) package registry on UNIX and Linux.

Another software identification mechanism is to analyze installed files: the name and properties of executables, dlls, jar, and other files and in some cases the content of specific files are often used to discover software products. Specific operating system or technology related repositories, such as the registry on Windows devices can be introspected to uncover installed applications. Finally, a new standard, the ISO 19770-2, has been adopted by major publishers such as CA, Symantec, Adobe or Flexera Software. It enables accurate discovery and inventory of installed software products through the use of software identification (SWID) tags, contained in XML files, that are added to each installation and stored on the hard disk.

There are many scenarios that are not covered by hard disk inventory. A software product can be running on a device from a shared drive. In this case, none of the inventory mechanism described above will work; only an analysis of the list of programs running in memory or a network discovery, if the product can be found though port scanning, will uncover it. Some products require more in-depth inventory: for instance, license management for Oracle database options requires connecting to the Oracle database and reading data from specific tables that monitor their usage. Application virtualization is another challenge as disk inventory will not provide software identification data. In this case, the best solution resides in querying the application virtualization tools themselves: Microsoft App-V or Citrix XenApp/EdgeSight, for instance, provide reliable application usage data.

License management requires more than a software inventory for each device. Publishers use many licensing metrics that require gathering additional data. User based licenses, where the number of users is counted regardless of the number of installations, require understanding which user is assigned to a device or is using it. Hardware property based licenses, primarily used in the datacenter, use a variety of metrics such as the number of sockets, processors, cores, the amount of memory, the speed and model of processors, etc. These metrics requires collecting hardware properties on each device where the application is running.

Virtualization Challenges

Another challenging area is operating system (or server) virtualization such as VMware ESX/vSphere or Microsoft Hyper-V and hardware partitioning technologies (HP nPAR, IBM LPAR, IBM WPAR, Solaris Zones, etc.). Understanding the relationship between a virtual machine or a partition and its physical host and being able to get the hardware properties of the host is mandatory for accurate license management as publishers have created specific rules tied to these environments. For instance, Oracle database licensing does not support soft partitioning and requires an entitlement based on the hardware properties of the host supporting the virtual machine, for processor based licensing. For some editions of their products, Microsoft has set a limit on the number of virtual machines that can be covered by a single license. Traditional device inventory running within a virtual machine or a partition has no visibility on its host. A specific host inventory is needed to get the host hardware properties and the list of virtual machines or partitions supported by it.

Software license management requires inventory data that goes beyond the traditional device inventory but organizations may not need to purchase new tools. They should first assess the accuracy and completeness of their device inventory tool, usually provided by the configuration management product. In some cases, configuration changes will be needed to collect all the data (package, file, registry, ISO 19770-2 tag, usage data…) required for license management. They should also investigate the availability of other inventory data sources. Many license management tools deliver discovery and inventory capabilities, but only the ones not covered by the configuration management tool, usually around hardware virtualization and in depth inventory such as Oracle should be implemented. The license management tool is responsible for aggregating the data from the multiple data sources enabling the accurate calculation of a license position for each software product.

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Learn more about discovery, inventory and application recognition by viewing our on-demand webinar.

Software Asset Management and Organizational Politics

By Natalie Overstreet Lias

Many organizations see the value in developing Software Asset Management programs based on cost savings, cost avoidance and license compliance risk mitigation.  Yet in some organizations, the notional commitment to Software Asset Management (SAM) never translates into savings.  Even commitment to and implementation of a Software Asset Management tool may not be enough to ensure success. 

I’ve written before about the need for a great team to deliver successful Software Asset Management, including an engaged executive sponsor, but I only touched on one of the most intractable sources of SAM failure:  organizational politics.  Software asset and license management typically involves the organization as a whole, even in the case of a large global organization with multiple subsidiaries.  For this reason, Software Asset Management projects ultimately require global scope.  In some cases, certain small or remote locations may be excluded from the scope of the Software Asset Management program, but certainly any large business unit must be included in order for analysis of software contracts, entitlements, inventory, and license position to be valid. 

This explains why organizational politics can significantly limit the positive impact of Software Asset Management.  If business units within the organization cannot agree to share inventory and entitlement information effectively, it is not possible to perform the analysis required to calculate an accurate enterprise-wide license position. This in turn, means that they can’t show where and how to realize software cost savings and mitigate license compliance risk.  In rare cases, business units may be hostile because they are actively trying to avoid involvement with license compliance activities.  However, far more typically, business units are uncooperative not because of any premeditated policy, but instead because they bear only the pain of Software Asset Management efforts and not much of the gain. (This may not be the case if there is an effective chargeback mechanism in place that allocates software costs to each business unit. In that case, the BU's have a vested interest in reducing software licensing costs.)

For example, consider a large a global corporation with numerous subsidiaries, including large American and European business units.  The American business unit works with the US federal government and is therefore subject to US government regulation and rules concerning personal data.  The European business unit is subject to different EU rules covering release of personal data.  Each business unit has a separate IT infrastructure in order to comply with these regulations (as well as for historical reasons). 

Both business units are open to contributing to Software Asset Management, but each bears the burden of compliance with its own governing regulations.  The technical problems with collecting a common inventory that meets all regulatory requirements can be solved, but it requires input, effort, and commitment from all of the business units.  And although IT infrastructure, software inventory and deployment processes are separate, the global entity purchases all software and will recognize most of the savings from Software Asset Management. 

In this case, the typical outcome is that the business units drag their feet and do not fully commit to the effort.  Their reluctance is understandable, but too much is at stake for the global corporation (and ultimately for the business units themselves) to allow failure due to organizational politics. A mature software asset management and license optimization program can help organizations reduce ongoing software costs by up to 30% per year in addition to reducing license compliance risk. So, the financial and risk reduction benefits are substantial.

The antidote is an engaged executive sponsor for global Software Asset Management who can bring these different parties to the table.  The benefits of a mature Software Asset Management program are generally enough to garner commitment from the business units, but that commitment has to be made from the business unit CIO or VP of IT to the global executive sponsor.  SAM is typically not disruptive in the sense of affecting ongoing business operations, but it does require time and commitment to make its promise a reality.

For your organization to realize the benefits from Software Asset Management and license optimization, all the business units in scope need to be on board, and the clearest path to success is alignment with and support from the IT executive team. 

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Learn more about getting started on software asset management and license optimization program by viewing our on-demand webinar.

Congressman Walsh Presses Need for Software Asset Management in Federal Government

By John Lipsey

US Congressman Joseph Walsh continues to take up the mantle of software asset management as being an obvious means of reaping “low hanging fruit" as the US government seeks to cut government waste. Back in October, he announced his successful introduction of an amendment to eliminate wasteful software license spend in the house version of the Department of Homeland Security authorization bill. Last month, he authored an article for AOL Government on the topic.  

In Congressman Walsh’s words, he’s enamored with the promise of software license optimization because:

The answer is simple – anywhere from 10% to 30% of the federal government's software spending could be eliminated through better software asset management. This legislation, aimed to rein in software spending at the DHS, is as good a place as any to start eliminating that waste.  This amendment answers the question: how can you give more productivity to users through software, while spending less money? This bill brings into clear focus something that private enterprises have struggled with for years. The complexity surrounding enterprise software licenses is mind boggling, making it very difficult for organizations to understand how much software they need, how much software they have, and how much software they're actually using. This results in two wasteful consequences: 1) endemic over-purchasing of certain software packages; and 2) endemic under purchasing of others.

The message is clear that cost containment will be a continuing dominant theme in government IT – but even more important will be cost containment strategies that deliver more capability and productivity to end users. That is, delivering more value for less spend. This is actually one of the primary themes around software asset management and license optimization and why I introduced this amendment, which answers the question: how can you give more productivity to users through software, while spending less money by optimizing software procurement, reducing software audit cost and risk, and improving IT operational efficiency?

Adopting best practices from the private sector around software asset management and license optimization is a painless and efficient way to eliminate this wasteful spending, while increasing the value being delivered to government employees. I'm hopeful that when the amendment I introduced gets voted upon and goes into law – we will have taken some significant strides in eliminating that waste.

On January 4, Congressman Walsh was out there again preaching the software asset management Gospel in an interview for Federal News Radio.  Walsh summed up the value proposition for the government succinctly:

This is a ... relatively easy, painless way to save federal spending without in essence having to cut anything.

Top 10 Things We’ve Learned about Software License Management

By John Smith

1. Don’t Boil the Ocean

The 80 / 20 rule applies especially to software license management.  There are usually a handful of software vendors who provide critical (and usually expensive) software for your organization.  Even within a given vendor’s software portfolio, it is generally a subset of their products that demand the majority of focus.  So when setting up software license management processes, tools and systems – focus on the "high rollers".  The “me too” applications will generally look after themselves.

2. Build License Management into the Fabric of Your Business

Unless license management is part of your normal business processes, it will not be attended to.  License management highlights the difference between important and urgent: it is always the former but seldom the latter (unless you are facing an unbudgeted seven figure software audit liability!).  Left unattended, it will largely be ignored. Therefore, license management must be included within signed off procedures to ensure license compliance is maintained and software costs are controlled.

 3. Negotiate Measurable Contract Terms and Communicate Internally

Too often there is a lack of communication between IT Procurement—the contract negotiators, and IT Operations—those who deploy and manage the software on a daily basis.  Many times the contract terms are not shared with implementers and deployment staff and unless they are consulted in advance of the inked contract, an unworkable agreement may exist. This can, of course, turn into a major license compliance issue. Its critical to communicate requirements, terms and conditions throughout the organization.

 4. Let Each Vendor Know You are Serious about License Compliance

One of the most disruptive activities for any organization is to be audited by a software vendor.  You can capitalize on the work you put into license management by letting the vendor know how seriously you are taking the subject and demonstrating that you have control of your software estate.  Organizations that implement best practice software asset management and license optimization processes and have the tools in place to help automate these processes are in the best position to defend themselves against a software audit and in many cases avoid them altogether.

 5. Involve Senior Management

You will need cooperation from numerous parts of the organization to implement an effective license management program.  Unless you have the "buy-in" from senior management you run the risk of having to implement a flawed process due to lack of cooperation from certain areas.

 6. Centralize License Management

There are many business processes and so much data associated with license management that it is imperative that contract negotiation (and monitoring) is carried out in the most centralized fashion.  The single characteristic that differentiates the leaders in this space is that they have consolidated and centralized their enterprise-wide licensing activities.

7.  Start Early

Don’t wait until the last minute to begin preparations for a contract negotiation with a major vendor.  The key to successful negotiation is to be prepared, be informed and be clear on desired outcomes.  To mobilize a cross-functional team, gather information for a fact-based discussion and define a strategy that will meet business objectives can often take several months of careful, detailed work.

8. Use Tools

License management is a challenge due to the many complexities involved—licensing, IT environment, and organizational complexities, to name a few.  There are numerous contracts, vendors, applications, sites and license owners that result in a plethora of data.  Unless advanced software asset management and license optimization tools are used, making sense of all this data, managing the complexities and maintaining license compliance will be impossible.

9. Track progress

As I noted above, it can be easy for license management to lose priority and focus in your organization.  So unless you start with a baseline and track your results, you will be unable to demonstrate the cost savings, cost avoidance and license compliance risk reduction that accrue from these activities.

10.  Publicize Wins

Publicizing your successes will help build the credibility of your software asset and license management program, motivate others and align their efforts. This is an important part of building a mature program over time. And the most mature license management programs have the greatest return on investment.