IT asset management is typically defined as being in the domain of information technology—but the reality is the discipline overlaps IT finance, procurement, and contracts.
By referring to a leading analyst group’s definition we see that while the “how” easily falls into IT’s domain, the “what” and “why” are of significant importance to contracts and procurement professionals: “IT asset management (ITAM) entails collecting inventory, financial and contractual data to manage the IT asset throughout its life cycle. ITAM depends on robust processes, with tools to automate manual processes.”
In order to properly manage IT assets, it is imperative for Finance and not just IT to understand the assets’ entitlements, as defined in the contract and procurement process.This understanding also comprises a best practice: regular, reliable reporting on software usage throughout the IT estate shared among IT, contracts, and procurement.
A best practice, and why IT Asset Management for contracts professionals matters: To improve their efficiency, contracts professionals need to consolidate and simplify the number of vendor contracts they manage.
In order to achieve this, they must have a thorough understanding of the ways in which their organization can reduce the number and/or level of software licenses.
IT asset managers can assist by providing reports on software by usage, and can help identify areas of software license audit risk and license recycling opportunities to help their contracts colleagues.
Some of the software asset management reports that contracts professionals will find helpful include:
- Software license entitlements and purchase history. This is an especially important area for IT contracts management not only in reducing compliance risk, but for ensuring there is a complete and accurate “one version of the truth” when answering the questions, “What do we own?” and “What do we have the rights to use?”
- A 360° view of the entire organization’s software assets. Especially for those firms that have grown through M&A, it is often hard to accurately identify all software assets in use, and whether that use aligns with contract entitlements. In order to understand the scope of the issue, contracts professionals need to understand the true extent of software usage.
- Software usage reporting. This goes beyond the time an application is open to almost forensic-level usage data, including the number of keystrokes and engagement with many features of the application. These reports can show cases where “shelfware” can be cut without any harm to the organization, or of underused applications that can be recycled or retired in favor of less costly alternatives. In this way, vendor consolidation can be implemented with no negative impact.
Providing reliable, regular reporting on the items above needn’t be a burden on IT asset management. Aligning contracts professionals’ needs with those of IT asset managers can be made almost effortless with new approaches to IT cost optimization. Once such new approach, Asset Vision from Scalable Software, can provide robust,reliable reporting on software assets—including dashboard views—that make it easier to optimize the number of vendors and associated contracts.