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3 weeks ago - edited 3 weeks ago
Part 2: Compliance, Optimization & Operations
Introduction
You've completed the setup and configuration in Part 1. Now it's time to verify your configuration, understand your optimization opportunities, and take action on compliance and reclamation.
This is Part 2 of a 2-part series on M365 optimization with SAM Pro:
- Setup & Configuration
- Compliance, Optimization & Operations (this article)
This article covers the verification phase of the Guided Setup, understanding your M365 data, and taking action on optimization opportunities.
Phase 3: Configuration Verification
Review and validate the Software Asset Management configurations to track and manage Microsoft 365 licenses and usage accurately.
3.1 Verify Complete Pull of All Subscriptions
Verify with the Microsoft 365 administrator that all subscription records have been successfully pulled.
How to Verify
- Navigate to License Operations → User Subscriptions
- Filter by your Microsoft 365 integration profile
- Compare the count against your M365 Admin Center subscription count
- Check that all expected subscription types appear (E3, E5, F3, etc.)
What to Look For
| Check | Expected Result |
|---|---|
| Subscription count | Matches M365 Admin Center |
| All subscription types present | E1, E3, E5, F3, etc. as applicable |
| User names visible | Not showing as anonymous/masked |
| Discovered User field populated | Users matched to sys_user records |
⚠️ If counts don't match: Check API permissions, admin consent, and whether the scheduled jobs completed successfully.
3.2 Run Health Check
Run a health check on the Health Check dashboard by selecting Microsoft 365, SaaS, and General to verify the Microsoft 365 configurations and review the findings for each suite.
Process
- Navigate to the Health Check dashboard
- Select the following categories:
- Microsoft 365
- SaaS
- General
- Review findings for each category
- Remediate any identified issues
Common Health Check Findings
| Finding | Resolution |
|---|---|
| Software models without Discovery Maps | Add DMAPs to affected models |
| Entitlements without Publisher Part Number | Add PPN to entitlements |
| User resolution mismatches | Configure user resolution rules |
| Missing API permissions | Update Entra ID app permissions |
3.3 Verify Pull of All Required Software Usage
Verify if the Software Asset Management application has pulled the usage details for your Microsoft 365 subscribed users, which is required to identify the last activity and determine optimization opportunities.
How to Verify
- Navigate to License Operations → Software Usage
- Filter by Microsoft products
- Check that usage records exist for key products:
- Exchange Online
- Microsoft Teams
- OneDrive
- SharePoint Online
- Power BI (if E5 subscriptions exist)
- Office apps (Word, Excel, PowerPoint, Outlook, OneNote)
Verify Copilot/Visio/Project Usage (If Applicable)
If you uploaded CSV reports for these products in Part 1:
- Filter Software Usage by "Copilot", "Visio Online", or "Project Online"
- Verify usage records appear
- If not, check that the daily scheduled job has run after uploading the CSVs
3.4 Create a Success Goal
Create a success goal to manage your Microsoft 365 licenses. This is different from the setup success goal created in Part 1 — this goal tracks your ongoing license management and optimization progress.
Why This Matters
A success goal for license management helps you:
- Track optimization progress over time
- Report realised savings to management
- Demonstrate SAM programme value
- Set targets for reclamation and compliance
Creating the Success Goal
- Navigate to Success Portal → Success Goals
- Click New
- Configure the goal for Microsoft 365 license management
- Set targets for:
- Reclamation completion rate
- Compliance position improvement
- Realised savings targets
3.5 Add Microsoft 365 to Published Product List
Add Microsoft 365 and associated products to the published product list to improve readability and declutter the Software Asset Workspace. Scale your SAM efforts strategically by evaluating progress based on resource needs, work quality, and configuration management.
Process
- Navigate to Software Asset → Administration → Published Products
- Add Microsoft 365 and associated products to the list
- This focuses your workspace views on the products you're actively managing
3.6 Run Reconciliation
Run reconciliation on the Software Asset Overview page to verify that the licenses are consumed according to the Software Asset Management configurations. Run reconciliation only for Microsoft as the publisher to verify Microsoft 365 license consumption.
Process
- Navigate to Software Asset Overview
- Select Run Reconciliation
- Filter by Publisher = Microsoft
- Wait for reconciliation to complete
- Review the results
What Reconciliation Shows
| Result | What It Means |
|---|---|
| Compliant | Entitlements match or exceed consumption |
| Over-licensed | More entitlements than consumption (potential cost savings) |
| Under-licensed | More consumption than entitlements (compliance risk) |
3.7 Check License Position Report
Check your overall compliance positions for Microsoft 365 and associated products in the License Position Report.
Process
- Navigate to the License Position Report
- Filter by Microsoft products
- Review compliance status for each subscription type
Understanding the Report
| Column | What It Shows |
|---|---|
| Entitlement | What you've purchased (from your entitlement records) |
| Consumption | What's being used (from M365 Admin Center integration) |
| Position | Compliant, Over-licensed, or Under-licensed |
| Variance | Quantity difference between entitlement and consumption |
Understanding Your M365 Data
Now that your configuration is verified, let's understand how SAM Pro tracks and presents your M365 data.
How SAM Pro Tracks M365 Data
Key Tables
| Table | What It Contains |
|---|---|
| samp_sw_subscription | User subscription assignments with last activity date |
| samp_sw_usage | Total usage from APIs and discovery sources |
| samp_m365_apps_usage_report | True/False activity flags per product from Microsoft APIs |
| saas_sw_storage_usage | Mailbox and OneDrive storage sizes |
| sam_sw_reclamation_candidate | Users flagged for reclamation based on rules |
| saas_downgrade_configuration | Downgrade paths with source and target editions |
| saas_downgrade_config_condition | Conditions that trigger each downgrade path |
Software Usage Activity Sources
| Source | Platform Support | Products Covered |
|---|---|---|
| Microsoft Graph APIs | Desktop, Web, Mobile | Outlook, Word, PowerPoint, Excel, OneNote, Teams, Exchange Online, SharePoint Online, Power BI |
| Microsoft SCCM or ACC-V | Desktop | Microsoft Office 365 apps for Enterprise (including Access, Publisher) |
| Jamf (macOS) | Desktop | Microsoft Office 365 apps for Enterprise |
| Manual CSV upload | Desktop, Web, Mobile | Microsoft 365 Copilot, Visio Online, Project Online |
Scheduled Jobs
| Job | Frequency | Purpose |
|---|---|---|
| SAM - Collect Microsoft 365 Usage | Daily | Collects usage data from Microsoft APIs |
| SAM - Create New Reclamation Candidates for Office 365 Integration | Weekly | Generates reclamation candidates |
💡 Note: For E3 → E1 optimization using Access and Publisher usage from SCCM/ACC-V, the candidate generation frequency is monthly instead of weekly.
The 90-Day Limitation
⚠️ Important: Microsoft's usage reports have a maximum 90-day lookback. Activity older than 90 days is not available via the API. A user who was active 91 days ago will show as having no recent activity.
Microsoft 365 Subscription Details Report
Navigate to SAM Workspace → Software Asset Analytics → Optimization and Savings tab to see the Microsoft 365 subscription details report.
This report shows the number of active, inactive, and unassigned user subscription details for Microsoft 365 products, grouped by software models.
| Data Point | Definition |
|---|---|
| Active subscriptions | Last activity date within the past 90 days |
| Inactive subscriptions | Last activity date is empty or more than 90 days ago |
| Unassigned subscriptions | Available rights or subscriptions not assigned to any user |
Select a data point to view more details about the user subscriptions for a software model.
How SAM Pro Calculates Savings
SAM Pro calculates potential and realised savings based on the unit prices captured in your M365 entitlement records — reflecting your actual agreement pricing.
| Savings Type | What It Means |
|---|---|
| Potential Savings | Estimated savings based on identified reclamation candidates |
| Realised Savings | Actual savings once reclamation workflows are completed |
Both are calculated using the unit prices from your entitlement records, giving you accurate figures based on what you actually pay.
The 4 Optimization Use Cases
SAM Pro identifies four types of optimization opportunities for Microsoft 365 and Office 365 subscriptions.
| Use Case | Applies To |
|---|---|
| Low Usage | Microsoft 365 and Office 365 |
| Downgrade | Microsoft 365 and Office 365 |
| Overlapping | Microsoft 365 |
| Consolidate | Microsoft 365 |
Use Case 1: Low Usage Subscription Reclamation
The Problem: Users with M365 or Office 365 subscriptions who aren't using the services — either individual products or entire subscription suites.
What SAM Pro Detects:
- Individual subscriptions (e.g., Microsoft Teams, SharePoint) showing low/no usage
- Subscription suites (Microsoft 365, Office 365) where the assigned licenses aren't being fully used
The Action: Reclaim the low usage subscription entirely. Reallocate to another user or reduce quantity at renewal.
With Microsoft Entra ID Spoke: SAM Pro can automatically remove the license — no manual intervention required.
Savings: SAM Pro calculates the savings based on your entitlement unit price for the reclaimed subscription.
💰 Quick Win: Low usage reclamation is typically the easiest optimization to implement — clear-cut inactive users with minimal business risk.
Use Case 2: Downgrade Subscriptions
The Problem: Users paying for higher-tier plans but not using the premium features that differentiate those tiers.
How SAM Pro Detects It: Evaluates specific conditions for each downgrade path.
Condition: No Power BI Usage
Users with E5 subscriptions who never use Power BI can be downgraded to E3.
| From | To |
|---|---|
| Microsoft 365 Enterprise E5 | Microsoft 365 Enterprise E3 |
| Office 365 Enterprise E5 | Office 365 Enterprise E3 |
Savings: SAM Pro calculates the difference between your E5 and E3 entitlement unit prices.
📊 Industry Benchmark: Industry estimates suggest 25-35% of E5 users could safely move to E3 without impacting their work. Actual results vary significantly based on organisation profile and feature adoption.
Condition: No Desktop App Usage
Users who only use web/mobile versions of Office apps (never Access, OneNote, Publisher, Word, Outlook, PowerPoint, or Excel on desktop) can be downgraded.
| From | To |
|---|---|
| Microsoft 365 Enterprise E3 | Microsoft 365 Enterprise F3 |
| Office 365 Enterprise E3 | Office 365 Enterprise E1 |
Savings: SAM Pro calculates the difference between your E3 and F3/E1 entitlement unit prices.
⚠️ E3 → F3 Special Requirement: This downgrade has additional conditions beyond no desktop usage:
- Exchange Online mailbox size < 2GB
- OneDrive for Business storage < 2GB
SAM Pro checks all three conditions before generating this recommendation.
Condition: No Teams Usage
Users who never use Microsoft Teams can be moved to a no-Teams variant.
| From | To |
|---|---|
| Microsoft 365 Enterprise E3 | Microsoft 365 Enterprise E3 no Teams |
Condition: Shared Email Box
Shared mailboxes don't need full user subscriptions.
| From | To |
|---|---|
| Microsoft 365 Enterprise E5 | Exchange Online Plan 2 |
| Microsoft 365 Enterprise E3 | Exchange Online Plan 2 |
| Office 365 Enterprise E5 | Exchange Online Plan 2 |
| Office 365 Enterprise E3 | Exchange Online Plan 2 |
💡 Tip: To enable this detection, set the user type as "Shared Email Box" in the Non-person Account field in the Discovered Users form.
Government and Education Variants
Similar downgrade paths exist for Government (G) and Education (A) plans:
| Condition | From | To |
|---|---|---|
| No Power BI | Microsoft 365 G5 USGOV GCCHIGH | Microsoft 365 E3 USGOV GCCHIGH |
| No Power BI | Office 365 G5 For Government | Office 365 G3 GCC |
| No Desktop | Office 365 G3 GCC | Office 365 G1 For Government |
| No Power BI | Microsoft 365 A5 for Students | Microsoft 365 A3 for Students |
| No Power BI | Microsoft 365 A5 for Faculty | Microsoft 365 A3 for Faculty |
| No Desktop | Microsoft 365 A3 for Students | Microsoft 365 A1 |
| No Desktop | Microsoft 365 A3 for Faculty | Microsoft 365 A1 |
Use Case 3: Overlapping Subscriptions
The Problem: Users or organisations with multiple active subscriptions that provide the same or similar services simultaneously.
Example: A user has both:
- Microsoft 365 E3 subscription
- Office 365 E3 subscription
This creates unnecessary duplicate access to Office applications and services already included in Microsoft 365 E3.
How SAM Pro Detects It: Identifies users with both Microsoft 365 and Office 365 subscriptions where the M365 subscription already includes the O365 functionality.
The Action: Reclaim the Office 365 subscription and use the Microsoft 365 subscription instead.
Use Case 4: Consolidate Subscriptions
The Problem: Users with multiple separate subscriptions that could be merged into a single unified subscription at lower total cost.
Example: A user has:
- Office 365 Enterprise E5
- Windows Enterprise
- EMS (Enterprise Mobility + Security)
The Action: Consolidate into a single Microsoft 365 Enterprise E5 subscription, which includes all three components at a lower combined cost.
Benefits:
- Cost savings from bundle pricing
- Simplified license management
- Easier tracking of usage and assignments
- Cleaner compliance position
How SAM Pro Detects It: Uses subscription assignment dates from the Microsoft 365 portal to identify users with separate component subscriptions that match an available bundle.
Taking Action
Act on Unlicensed Subscriptions
Identify and address unlicensed Microsoft 365 subscriptions to maintain compliance.
Process
- Review the License Position Report for under-licensed products
- Identify users consuming licenses without entitlements
- Take action:
- Purchase additional licenses to cover the shortfall, OR
- Remove subscriptions from users who don't need them
Compliance Risk
Under-licensed positions represent compliance risk. Address these before your next Microsoft audit or true-up.
Act on Optimization Recommendations
Software Asset Management supports various optimization use cases, which you can view on the Software Asset Analytics page.
Where to Find Recommendations
| What You Want | Navigation Path |
|---|---|
| Optimization dashboard | SAM Workspace → Software Asset Analytics → Optimization and Savings tab |
| Reclamation candidates | Software Asset → Reclamation → Reclamation Candidates |
| Downgrade candidates | Reclamation Candidates (filter by downgrade type) |
Processing Reclamation Candidates
- Navigate to Software Asset → Reclamation → Reclamation Candidates
- Review candidates generated by reclamation rules
- Validate candidates are accurate (spot-check a sample)
- Approve or initiate reclamation workflows
- Track workflow progress
With Automated Removal (Entra ID Spoke)
If you have the Microsoft Entra ID Spoke installed:
- Configure reclamation rules for automatic execution
- Set appropriate grace periods for user notification
- SAM Pro will automatically remove licenses after the grace period
Without Automated Removal
If you don't have the Entra ID Spoke:
- Review and approve candidates in SAM Pro
- Export the list of users for license removal
- Manually remove licenses in M365 Admin Center
- Mark candidates as completed in SAM Pro
Configuring Reclamation Rule Thresholds
Recommended Approach: Start Conservative, Then Tighten
Month 1-3: Set threshold at 90 days
- Monitor candidate accuracy
- Track false positive feedback
- Build confidence in the data
Month 4-6: If accuracy is high, consider tightening to 60 days
- Review results monthly
- Adjust based on business feedback
Ongoing: Find your organisation's sweet spot
- Some organisations run at 45 days successfully
- Others stay at 90 days due to seasonal workers or project-based roles
Configuring Exclusions
Not everyone should be subject to automatic reclamation. Configure exclusions for:
| Exclusion Type | Reason |
|---|---|
| VIP users | Executives, board members |
| Service accounts | Non-human accounts for automation |
| Shared mailboxes | Used by teams, not individuals |
| Legal hold users | Compliance/litigation requirements |
| New hires | Haven't had time to establish usage |
| Seasonal workers | Predictable periods of inactivity |
Ongoing Operations
M365 optimization isn't a one-time project. Once your integration is set up, you need to maintain the data quality and act on opportunities regularly to realise ongoing value.
Keeping Your Data Current
Your optimization recommendations are only as good as your data. Focus on these key areas:
Integration Health
Monitor your M365 integration to ensure data continues to flow correctly. Scheduled jobs should complete successfully, and subscription/usage counts should remain consistent with your M365 Admin Center. If jobs start failing, the most common cause is an expired client secret in your Entra ID application — check this first.
Copilot, Visio, and Project Usage
Unlike other M365 products, Copilot, Visio, and Project usage requires manual CSV uploads from the M365 Admin Center. Establish a regular cadence (monthly is typical) to download and upload these reports. Without fresh data, reclamation candidates for these products will become stale.
Entitlement Accuracy
As your organisation's M365 subscriptions change — through purchases, renewals, or true-ups — update your entitlements to reflect the current state. Outdated entitlements lead to incorrect compliance positions and savings calculations.
User Resolution
New employees and departures affect user matching between M365 and ServiceNow. Periodically review unresolved users to maintain accurate per-user compliance and optimization data.
Regular Review Cadence
Establish a regular rhythm for reviewing optimization opportunities and acting on them. The frequency depends on your organisation's size and the volume of reclamation candidates, but monthly reviews work well for most organisations.
During each review cycle:
- Check data quality — verify scheduled jobs completed and data looks reasonable
- Review the Optimization and Savings dashboard — understand your current optimization potential
- Process reclamation candidates — validate and action candidates that have been generated
- Update compliance position — run reconciliation and review the License Position Report
- Track progress — update your Success Goal and document realised savings
The key is consistency. Regular small actions compound into significant savings over time, whereas sporadic large efforts often lose momentum.
Success Metrics
Track these KPIs to measure your M365 optimization programme and demonstrate value to stakeholders:
| Metric | Target | What It Measures |
|---|---|---|
| Subscription utilization | > 90% | Active users ÷ Assigned subscriptions |
| Low usage rate | < 5% | Inactive subscriptions ÷ Total subscriptions |
| Unassigned license rate | < 5% | Unassigned licenses ÷ Total purchased |
| Reclamation completion rate | > 80% | Completed reclamations ÷ Initiated reclamations |
| Compliance position | 100% compliant | No under-licensed products |
| Realised savings | Track trend | Cumulative savings from completed reclamations |
Use your Success Goal to track these metrics over time and report progress to management.
Preparing for True-Ups and Renewals
Your Microsoft agreement type determines how and when you need to reconcile your license position. SAM Pro data is essential for making informed decisions at these key moments.
Understanding Your Agreement Type
Microsoft offers several agreement types, each with different characteristics:
| Agreement Type | Typical Term | Key Characteristics |
|---|---|---|
| Enterprise Agreement (EA) | 3 years | Annual true-ups, volume discounts, price protection. Requires 500+ users/devices. Being phased out for some customers. |
| Enterprise Agreement Subscription (EAS) | 3 years | Subscription variant of EA. Allows true-down (with limitations). |
| Microsoft Customer Agreement (MCA) | No fixed term | Flexible, cloud-focused. Available direct or via CSP. No automatic volume discounts. |
| MCA-Enterprise (MCA-E) | No fixed term | Direct Microsoft agreement for large enterprises. Replaces EA for many customers. |
| Cloud Solution Provider (CSP) | Monthly/Annual | Partner-managed. Flexible but typically no volume discounts. |
💡 Note: Microsoft is actively transitioning customers from Enterprise Agreements to MCA-E or CSP. Check with your Microsoft account team or licensing partner about which agreement type applies to your organisation.
True-Up Preparation (EA/EAS)
For Enterprise Agreement customers, the annual true-up is when you reconcile the licenses you've used against what you've paid for. Start preparing 3 months before your true-up anniversary:
What to prepare:
- Current subscription counts by tier (E3, E5, F3, etc.) from SAM Pro
- Comparison against your committed quantities
- Any over-deployment that needs to be paid for
- Optimization opportunities to reduce quantities before true-up
Key actions:
- Complete pending reclamations before the true-up date
- Process downgrade candidates to reduce higher-tier counts
- Document your compliance position with data from SAM Pro
Renewal Preparation (All Agreement Types)
Renewals are your opportunity to right-size your Microsoft investment based on actual usage. Start preparing 3-6 months before your renewal date — earlier for larger organisations or complex negotiations.
What to prepare:
- Utilization data by subscription tier
- Inactive and low-usage subscription counts
- Downgrade and consolidation recommendations
- Trend data showing optimization progress
- Projected requirements for the next term
Building your business case:
- Document current state — Total licenses by tier, actual utilization rates, current annual cost
- Identify right-sizing opportunities — Reclamation candidates, downgrade opportunities, consolidation options
- Calculate proposed state — Adjusted quantities based on actual need, projected cost, savings vs current
- Present to stakeholders — Data-backed recommendations with clear cost/benefit analysis
Negotiation leverage:
SAM Pro data gives you evidence-based negotiation power. When you can demonstrate:
- Exactly how many licenses are actively used
- Which tier each user actually needs
- Historical optimization trends
...you're in a much stronger position to negotiate quantities and pricing that match your actual requirements rather than accepting a simple renewal of current quantities.
Quick Reference: Downgrade Paths Summary
Commercial Enterprise Plans
| Condition | From | To |
|---|---|---|
| No Power BI usage | M365 E5 | M365 E3 |
| No Power BI usage | O365 E5 | O365 E3 |
| No desktop usage | O365 E3 | O365 E1 |
| No desktop usage + storage <2GB | M365 E3 | M365 F3 |
| No Teams usage | M365 E3 | M365 E3 no Teams |
| Shared mailbox | M365 E5/E3, O365 E5/E3 | Exchange Online Plan 2 |
Products Checked for "No Desktop Usage"
Access, OneNote, Publisher, Word, Outlook, PowerPoint, Excel
Quick Reference: Navigation Paths
| What You Need | Where to Find It |
|---|---|
| User Subscriptions | License Operations → User Subscriptions |
| Software Usage | License Operations → Software Usage |
| Integration Profiles | License Operations → Direct Integration Profiles |
| Optimization Dashboard | SAM Workspace → Software Asset Analytics → Optimization and Savings |
| Reclamation Rules | Software Asset → Reclamation → Reclamation Rules |
| Reclamation Candidates | Software Asset → Reclamation → Reclamation Candidates |
| Health Check | Health Check dashboard |
| License Position | License Position Report |
| Success Goals | Success Portal → Success Goals |
Questions?
Join us at SAM Office Hours — our monthly community call where you can ask questions directly to product experts. Check the Community Events calendar for the next session.
This is Part 2 of a 2-part series on M365 Optimization with SAM Pro.
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