Matt Fisher of Centennial Software looks at the benefits of simplifying software asset management.

It is an irony of modern business that, despite investing huge amounts of financial and human capital into IT, organisations often have less interest in effectively tracking and managing those assets than they do in maintaining the company car.

Although most IT directors would claim to know exactly how many PCs they have on their network, the reality is that more than two-thirds of organisations have a discrepancy of up to 30 per cent between expected and actual inventories (Gartner's Life Cycle Management Underpins IT Asset Management report, August 6, 2004).

This lack of knowledge poses obvious problems for IT directors - how can you accurately budget and plan if you don't know what you've already got? And how can you eliminate waste if you don't know what people are using? Effective software asset management (SAM) allows organisations to manage IT assets in order to support business goals, enabling companies to control costs, strengthen security and improve corporate governance, all while minimising risk.

Despite these latent benefits, many businesses still view SAM as a hindrance that is confusing and time-consuming, rather than as a project that is easy to deploy and can bring many rewards.

However, according to Gartner, SAM helps organisations save up to 30 per cent of their IT budget, so it is little wonder that it's rapidly rising up the CIO's agenda, despite concerns regarding its complexity. A commitment to SAM demonstrates that an organisation understands the critical role that software plays within a business and the necessity to glean as much value from its IT assets, whilst remaining operationally compliant at all times. In this time of heightened regulation in a volatile economy, organisations cannot afford to have anything less than complete knowledge and control of their IT estate.

An effective approach to SAM can not only meet this requirement but also improve productivity and deliver significant cost savings. Take the example of the Telegraph Media Group. An effective SAM strategy helped the company gain complete control of their IT assets and bring savings of £100,000 from over-expenditure on unnecessary licenses.

With 1,000 employees and even more desktops, laptops and servers at five sites across the UK, the newspaper group faced a constant battle to audit and manage its software assets. A manual audit was taking a month to complete, meaning as soon as it was finished, it was out of date and so had to be started again.

The Telegraph Group implemented an automated software solution, which allowed the IT department to more accurately determine how much software was on the network and therefore what their licensing position was. In this case, the audit showed that the company was over-licensed to the tune of £100,000 on some software, enabling the IT team to take remedial action in the form of cutting back on new license purchases and re-negotiating contracts with suppliers.

The positive results are plain to see, but for some IT directors and CIOs SAM is still viewed as overly complex and costly, in part due to the ISO 19770-1 standard. However, the truth is that it is far easier to get started than it may appear and steps are being taken to further simplify this process.

Although CIOs need, initially, to be aware of the whole SAM process (including deployment and patching), there are some aspects, such as discovery and license management, that are quick and simple to implement. These can deliver a much more immediate business and financial impact: lower costs, greater security, decreased risk and improved corporate governance. These initial steps will also set organisations on the road to achieving full ISO 19770-1 compliance when the time is right.

Discovery of the software installed across the network provides the foundation for everything else - you can't figure out what you need (and don't need) if you don't know what you have. License management provides a significant, immediate ROI by reducing both wastage and risk by providing visibility of the licenses held and therefore avoiding overbuying and under-licensing.

Taken together, discovery and license compliance form the basis of successful SAM best practises, providing a rapid return and a less complex implementation than deployment or patch management. These swift results will appease those anxious board members who have invested in SAM and are keen to see it bearing fruit.

Starting SAM with a focus on discovery and license management requires four basic steps:

  • Inventory of installed software assets
  • Capture of license records
  • Identification and validation of records against vendor records
  • Reconciliation of software installations against license entitlement.


A company's first step into SAM should be to perform a software inventory. This will determine:

  • What software is in use across the organisation?
  • Is the company using the most recent versions of the programmes it needs?
  • Does the company have any unused programmes that can be removed or reallocated?
  • Does the company have a licensing shortfall on any applications?    
  • Does every employee have the needed software?
  • Is the installed software on each machine used regularly?

Inventorying all the assets on the network is the basic function of discovery and fortunately there are automated tools, which simplify this process and generate a quick, efficient and accurate record.


Once the inventory is complete, the next step is to capture all license records into a centralised license management system. This is much more effective than manual filing when it comes to producing compliance reports and deriving business intelligence about current and future licensing needs. An automated solution will also minimise the chance for human error, as well as the time and resources needed to build and maintain the data repository.

Identification and validation

Next, businesses must understand how the information they have collected relates to what they thought they had and what the software vendors think they have. Often there will be discrepancies between original invoices, installed software and future audits. There are solutions available which can aid this process by automatically comparing the collected information with vendor product catalogues.


Given the dynamic nature of most IT networks, software usage and license entitlements change on a near-daily basis. As such, it is critical that any reconciliation between software and licenses not only uses the latest information, but also has some built-in intelligence to understand and benefit from different licensing models.

For example, some licenses will support multiple products, while others may be restrictive in terms of language support or upgrade rights. Automatically reflecting these conditions in the SAM solution ensures that any reconciliation presents the best possible outcome for the organisation.

While organisations have traditionally found it difficult to accurately determine the total cost of poor software management, increasingly IT leaders are recognising that better controls, processes and technologies can deliver significant cost savings and productivity gains across the enterprise.

By concentrating first on asset discovery and license management, any organisation will dramatically improve visibility and control of its IT infrastructure and increase productivity. This IT governance and knowledge of assets should become second nature to an organisation, allowing it to feel more secure in its position and negotiate from a stronger position.

More importantly, as a result, the business can enjoy immediate cost savings from improved software allocation, volume license discounts, accurate asset depreciation and more - all while eliminating the risks associated with software non-compliance, lack of policy enforcement and inappropriate use.