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Looking from the outside helps give you a wider view of your software situation

When it comes to effective software asset management, it pays to know the right people. Many organisations have only a sketchy understanding of their own licensing position, let alone knowledge of the options available or strong enough relationships with their vendors to negotiate the most advantageous position. That’s where working with an experienced third-party partner like Computacenter can really pay off.

Tina Fruhauf, Computacenter’s software licensing manager, has been dealing with IT industry licensing for the past eight years and her experience ranges from the baseline of working out what organisations need all the way up to developing complex solutions, such as examining how to make procurement work effectively in tandem with software asset management (SAM) and optimising businesses’ software licensing lifecyles.

Fruhauf points out that as organisations come to realise the importance of effective software management, so they are increasingly beginning to understand the extent of the challenges they are facing. “If you look back 10 years, the issue of SAM wasn’t really very visible on people’s radars, but as it creeps higher up the agenda businesses are seeing the impact is far greater than just the cost of licences. To get on top of the issue takes a huge amount of resources,” she says.

PROFESSIONAL PARTNER

Once they discover the extent of the challenge, many organisations choose to take advantage of the services of a third-party specialist such as Computacenter. A skilled, professional partner will be able to bring to the table both the rigour of process and the wisdom of experience. Fruhauf says: “Each customer is very different. They face a similar set of problems, but the combination and stages of maturity of those problems varies enormously from organisation to organisation. We take a step-by-step approach, first of all consulting with customers to make sure we have a good understanding of their specific problems.”

At this stage, Computacenter will often be able to identify issues that the organisation has failed to take into account or has misinterpreted. “For example, a customer might think they have a problem with knowing exactly what they’ve bought when in fact the main problem is not knowing what they’ve got installed. We help them negotiate the minefield and pinpoint exactly where the pain-points are, then work with them to rectify those,” says Fruhauf.

Some companies may want to conduct a more thorough systems analysis and hardware consolidation before looking specifically at software management, and Computacenter can also help here.

But simply looking at the software management side of things, the company’s range of services encompasses a number of different measures to help organisations address the interconnected challenges of complexity, cost and compliance (see box, ‘Comprehensive services’, top right). Fruhauf says: “We offer licensing consultancy and portfolio rationalisation services to address the complexity of products and contracts, depending on the specific technical or procurement challenges faced. The two main ways we can help customers reduce their costs is by helping them ascertain their effective licence position (ELP), and also by benchmarking their contracts and examining the terms and conditions within them, making sure they’re buying at the right level and so on.”

SIGNIFICANT SAVINGS

Indeed, Computacenter’s knowledge of the market and negotiating power with vendors means the company is often able to pave the way for significant savings. “We know if a vendor has a more flexible contract with one of our other customers, we can use that knowledge to negotiate a better contract on the second customer’s behalf,” says Fruhauf.

She cites the example of one customer, a large pharmaceutical reseller, that managed to save £80,000 after Computacenter benchmarked its contracts in this manner. “We worked out it would be cheaper for them to buy through the US, so we set up the relevant contract, making sure the terms and conditions were favourable to them,” she says.

Another key area where a partner like Computacenter can help considerably is compliance, through services such as software auditing, entitlement tracking and compliance ‘health checks’. Fruhauf says: “The first step would generally be to ascertain their effective licence position, obtaining their audit records to see what they have ‘in the bank’, so to speak. For example, they might be lacking 40 licences for one product, but have bought 30 too many of something else.”

Armed with these facts, Computacenter can once again use its negotiating power with vendors to reduce the cost to customers of becoming compliant.

“We have the relationships to be able to have sensible conversations with vendors. If a dispute or investigation over compliance is in the initial stages, we can certainly
step in and act as an intermediary,” Fruhauf says.

In one case, a customer had purchased the base licences for a set of products nine years prior to a compliance investigation. The problem was that the company only kept its financial records for seven years, so was unable to prove it had bought the licences fair and square.

That meant all the upgrades the organisation had purchased on top of those licences were deemed invalid. “We stepped in and managed to negotiate with the vendor,” says Fruhauf. “In the end, we found other ways of proving the existence of the original licences by going through different sets of records until we found information from a reliable enough source to prove the customer was indeed compliant. Because of that, we managed to save them several hundred thousand pounds in licensing costs.”

GENERATING SAVINGS

Even though there will generally be a cost to becoming compliant, Computacenter can also help customers generate other licensing savings to offset this. “For one large government organisation, we worked in conjunction with its outsourcer to ascertain its ELP. That meant negotiating with every single vendor with which this organisation had a contract so it could see where it needed to address licensing issues or stop procurement of particular products. And because it was spending millions of pounds, the savings generated were considerable,” says Fruhauf.

Another government customer of Computacenter didn’t understand the complexity of its agreement with a particular vendor. “The customer was about to place an order for some licences it didn’t need to buy – it was already entitled to the licences as part of a promotion on another product it had purchased, but the vendor had failed to point out this additional entitlement. We managed to save the customer about £70,000 as a result,” says Fruhauf.

However, effective software management is about more than streamlining licensing and procurement; it’s also vital to manage software effectively through its entire lifecycle. Again, Computacenter can help. Fruhauf says: “There’s no point being really good at procurement and deployment, but falling down on day-to-day issues. Customers need to have a really tight hold on the whole of lifecycle, and we address that through measures such as software audits and policy and procedure reviews to make sure everything else we’ve done is maintained and carried forward.”

PROACTIVE SERVICE

Computacenter also offers a proactive renewal packing and tracking service. “It doesn’t just track licences we’ve sold to a customer,” says Fruhauf. “It uses our records in conjunction with vendors’ records so we can provide customers with a huge pipeline of renewals for the next year, or as far in advance as we can get data.” That gives organisations the ability to know which licences are due when, and maybe help them get onto a better pricing band by consolidating. It also provides customers with the sort of checks and balances they need to ensure that, for example, the number of licences they have tallies with the number of support contracts they’ve purchased.

The company can also offer help around specific vendors. For example, it has a Microsoft service that it offers to all its Select clients. This includes some of the services already mentioned, such as ELP creation, and Computacenter will also track the customer’s licence position and give it feedback on a six-monthly or annual basis depending on circumstances. So they’re not just getting a view of the licences they’ve bought, but a consolidated view that allows them to spot things like a department buying boxed products or open licences instead of adding them into an existing negotiated contract. Once again, this acts as a check and balance once an organisation’s procurement policies and procedures are in place.

So how much are these kinds of third-party services likely to cost you? Certainly a lot less than they’re likely to save you. Fruhauf says: “We’re prepared to be fairly flexible and develop a model that works for the customer. The cost will vary depending on the size and structure of the organisation and on the complexity of the problem. We tend to work on a day rate for consultancy and on a job-by-job basis for ELP creation – researching all of the licences a customer has bought from a particular vendor.

“The main thing is to identify where you perhaps lack understanding or aren’t sure of your position. By engaging a partner that does, you can significantly reduce complexity, manage compliance and cut costs.”