Why Software Asset Management Needs to Include SaaS Management Capabilities

Bryan Blackburn · ‎07-25-2018

Software Asset Management is the business strategy for optimizing the purchase, deployment, maintenance, and disposal of software applications within an organization. Software Asset Management (SAM) is not a new term by any means, but the way we manage software within our organizations is rapidly changing.

An effective SAM strategy reduces the costs associated with on-premise software and limits the risks related to the ownership and use of software, ultimately maximizing the work and performance of the end user. Businesses are now adopting more and more cloud-based Software-as-a-Service (SaaS) applications. However, most Software Asset Management solutions are in the early stages of managing the growing number of cloud services. SaaS management needs to be incorporated into your overall SAM strategy.

In this post, we'll discuss why the most effective and accurate way of tracking, managing, and optimizing software performance requires both SAM and SaaS management to ensure every application and service is accounted for in your software inventory.

What Is Software Asset Management?

Software Asset Management is a practice that was designed in the era of installed licenses for on-premise products which ruled the business world during the 80s and 90s - and continues to have an enormous presence in well-established businesses. The delivery model was a bit faulty, as you could install more copies of a license than you were "entitled" to install, meaning major "publishers" could hire a firm to audit you and "true-up" your actual licenses usage. Often times, the customer would owe the vendor money-sometimes millions of dollars or more for large enterprises. Thus, SAM was born.

SAM empowers companies who are using on-premise software to more effectively manage all of their installed applications. There are multiple components to an effective SAM strategy, but here are four that every business needs to know: discovery, license optimization, license and entitlement compliance, and data security.

Discovery

The software discovery process begins with the scanning of devices for software in order to build a robust inventory-a process that can be very costly and time-consuming without using proper SAM tools. Trying to manage company-wide software is nearly impossible if done only with a spreadsheet. A single company could use thousands of different software products, a difficult number to manage with a simple spreadsheet which is not going to provide valuable insight into who is using what product and how often.

License Optimization

Software licenses are valuable—and costly. Many companies have complex agreements with a number of vendors, each agreement containing varying software licensing models and policies. These licenses are the assets that need to be managed carefully. Many businesses will over-purchase licenses in order to maintain compliance with their license agreements and avoid over-deploying. SAM tools help businesses monitor software usage frequency and track who has which license installed on which device.

License and Entitlement Compliance

SAM aims for license and entitlement compliance and for the speedy resolution of non-compliance issues. An inevitable audit can easily leave businesses scrambling, often leading to high true-up costs due to the over-deployment of licenses, duplicate installations, or hacked installations.

Data Security Risks

Rogue, unpatched software is regarded as one of the most severe security risks businesses face. Hacks or viruses that stem from these risks can cause sensitive data to be leaked or destroyed. An effective SAM strategy enables organizations to keep their most sensitive data secure.

If you're familiar with SaaS management solutions, you realize these components are also critical to an effective SaaS management strategy. If you are not familiar with SaaS management, no worries! Let's explore how discovery, license optimization, and compliance are just as critical for SaaS management.

What Is SaaS Management?

You can think of SaaS Management as a member of the SAM family, specific to cloud-based applications and services. While many businesses use on-premise software, many of our beloved applications and the way we purchase and use software is quickly moving to "the cloud" with the end user in mind. These emerging SaaS products require a new way to track and manage software use, and SaaS management is the solution.

SaaS Discovery

A SaaS management solution leverages APIs to ingest data from financial, contract, and vendor systems to paint a picture of cloud-based software products and services being used across the company-including those flying under the radar on personal and company credit cards. An effective SAM strategy will centralize cloud-based products and applications into one location, making it easier to track, manage, and optimize SaaS subscriptions.

SaaS License Optimization

Once SaaS solutions are implemented, it can be difficult to track the usage of each application-especially at scale-when organizations have several hundred applications in use. Many SaaS providers do not proactively alert users when set usage thresholds are exceeded, often resulting in unplanned overage charges.

Effective SaaS management highlights and mitigates applications with "stale" licenses, which are licenses that are being paid for but go unused. This happens for a number of reasons:

● Employee Churn: Employees with access to SaaS accounts leave the company but maintain access and instead of re-assigning that license, the new employee is offered a new license
● Ineffective De-provisioning: Access to applications is not effectively tracked and managed, meaning previous employees or contracted employees may still have access to accounts that they shouldn't have access to
● Unnecessary Top-tier Licenses: In some cases, employees may be given top-tier access to an account (with all capabilities and functions) when they only need lower-level permissions within the application
● Universal Access: Some companies provide universal access to certain applications (like Microsoft Office 365) even though it is never used or not required to perform their jobs

SaaS Data Security Risk

Data security is a top priority for any business, in any industry. More businesses are modernizing their software through cloud-based applications but are presented with some security risks when using business-critical SaaS applications. Once you input data into a SaaS system, you give permission to unknown entities who can—and will—access your data. While pure SaaS vendors don't require the concept of "compliance" or "effective license position", for SaaS, customers must be wary of gaps in their de-provisioning process. Users who are no longer employed but who still have a license create more risk. Therefore, minimizing data security risks must be a paramount concern not just for information security, but also for asset management teams and SaaS owners in the business who hand out SaaS licenses.

Why SAM Needs SaaS Management

Software Asset Management and SaaS management are two pieces of the same puzzle. They each empower businesses to better manage all types of software across the organization. ] This provides a holistic view of on-premise and cloud-based software used, the costs associated and the compliance risks involved. Determining whether or not licenses are optimally used can only be achieved when SaaS is included in your SAM strategy.

Compared to Software Asset Management, SaaS management is less about being prepared for compliance audits, like in the on-premise world, and more about consumption, spend, and license management. The risk of having too many user licenses and/or inactive user licenses can cause licensing costs to soar.

ComputerWorld explains some challenges that require SAM for SaaS:

SaaS Purchasing Process: There is no longer one master list of who bought what, to solve which problem and here's how we know if it's working. SaaS is one of the hardest categories to track in real-time.

SaaS License Management: With hundreds (and sometimes thousands) of SaaS applications in use by our organizations, it becomes nearly impossible to accurately compile data from each vendor regarding license usage and spend.

SaaS Renewal Process: Many SaaS contracts will "auto-renew" if no action is taken to signify otherwise during the renewal period. This is the time to evaluate if there are applications with overlapping functionality or multi-channel spend to partner with the business and make a savings impact.

New technology and the shift to cloud-based SaaS applications and products are forcing businesses to change the way software is managed. On-premise software management tools are still needed, but without an accompanying SaaS ] management solution, there will be huge gaps in your inventoried tech stack.

Have You Heard?

In addition to Microsoft O365 and Adobe Creative Cloud available in 2018, ServiceNow is excited for 2019 with plans for additional SaaS offerings to supplement our beloved SAM product. As we continue building the best solution for our users, please take a few minutes to take our SaaS survey if you currently are involved in SaaS purchasing and management for your organization:

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