Last month, the publication FedTech reported on how NASA saved over $100 million in software licenses.
This is an interesting story on how, through better software asset management practices and the use of appropriate tools, the government was able to significantly reduce spending on software.
The Federal Government spends about $6 billion each year on commercial software. As a result, there have been many initiatives to better manage software licenses, vendors, and ultimately reduce costs. This is evident in recent legislation designed to help better manage the software asset lifecycle.
Over spending on software is not a just a government issue. Analyst firms have reported that as much as 30% of a software budget can be saved through employing Software License Optimization practices and tools. (You can read more about this in John Emmitt’s blog “Gartner says Software License Optimization can reduce software costs by 30%!”)
In regards to NASA, they began their initiative in 2008, when they created the Enterprise License Management Team (ELMT). Their goal was to inventory software assets and to centrally manage software purchases.
Many large organizations, such as NASA, purchase software through different departments and locations. Without centralized management of software contracts, purchases, and software inventory, it is easy to buy redundant licenses and miss out on opportunities for volume discounts.
After creating the ELMT, NASA was able to save $103 million since 2011, through negotiating agency-wide contracts and removing redundant and unused software licenses.
NASA is not alone in changing their processes and tools to save money on software. The United States Navy reportedly saved $450 million over three years by managing how the service branch purchased, managed and used technology. At the beginning of their cost savings initiative, the Navy had no idea how many of its software licenses were actually being used, when the software was purchased, and if the software was only used in a limited way.
The U.S. Citizenship and Immigration Services (USCIS) is another example of a Federal Agency improving their software asset management processes. USCIS created a strategic vendor management (SVM) branch to oversee software purchases and license renewals. With the ability to monitor actual license use, USCIS was able to reduce spending on unnecessary licenses.
These examples of greatly improved software asset management were codified in recent legislation such as the Federal Information Technology Acquisition Reform Act (FITARA) and the MEGABYTE Act (Making Electronic Government Accountable by Yielding Tangible Efficiencies).
Jim Ryan, our CEO, wrote about FITARA last year. In his blog, he listed the FITARA guidelines:
- Appoint a Software Manager that will lead the agency-wide effort to centralize license management and implement strategies to reduce duplication and ensure adoption of software management best practices.
- Maintain an agency-wide inventory of software licenses, including licenses purchased, deployed and in use, as well as spending on subscription services (including cloud/SaaS).
- Leverage commercially available IT tools to support processes for compiling and maintaining software license inventories. (It defined commonly used IT tools, which enable best practices and reporting on software inventory, costs and usage, to include Software Asset Management/Software Licensing Optimization solutions, among others.)
- Use this technology to automate hardware and software asset discovery, IT asset inventory tracking, software inventory normalization, contract management, purchase and product use rights license reconciliation, software license optimization and SAM data sharing capabilities.
- Develop automated, repeatable processes to aggregate software license and maintenance requirements for commercial off the shelf software and software acquisition. Analyze inventory to ensure compliance, consolidate redundant applications and identify other cost savings opportunities.
- Centralize, streamline and establish best practices in software procurement and contracting.
Do you want to learn more about how to proactively gain control and manage your software estate in order to reduce waste and maintain compliance with license agreements? We have two informative webinars to share with you.
The first webinar is How ARRIS created an Engineering License Management System. You will learn how ARRIS leveraged FlexNet Manager for Engineering Applications to efficiently utilize their engineering software, improve control over their most strategic and critical software tools optimize spend on new software, and minimize ongoing maintenance fees. This webinar will be live on April 25 and April 27, and on-demand after those dates.
The next webinar is on-demand and you can view at any time. “Get Ready to Meet the Federal Mandate on Software Asset Management features guest speakers Prentice Norman from the U.S. Citizenship and Immigration Services (USCIS), and Andrew Howell, from Monument Policy Group. In this webinar, you will learn:
- About the federal regulations and mandates
- How to translate legislative requirements into an action plan for compliance
- An understanding of the software asset management processes and tools required to meet the mandates
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