Effective Cost Analysis for Software Renewal Strategies

Organizations in industries such as energy, aerospace, defense, and manufacturing often utilize expensive engineering and specialty applications. However, typically only a few vendors account for the majority of their software expenses. As the renewal date approaches, application teams usually suggest a number of licenses to renew, but often lack a solid basis for determining the actual usage data necessary for informed decision-making. This raises the question: How can they confidently negotiate the number of licenses they truly need with vendors?

This scenario highlights the common challenges organizations face, primarily the lack of visibility. There is often an insufficient understanding or monitoring of how licenses are utilized across the organization. Due to this lack of visibility and control, organizations are at a significant risk of overspending, and they also face challenges in effectively allocating software resources.

Open iT addresses this issue by enabling organizations to:

  • Understand their license inventory and how applications are used.
  • Conduct cost analyses to identify opportunities for cost savings and return on investment (ROI).
  • Assess the actual need for licenses based on accurate usage data, ensuring that only necessary and cost-effective licenses are renewed.

Methods of Data Collection

Organizations typically select one or two vendors and implement an engineering and specialty application metering solution like LicenseAnalyzer. They can choose to simply collect the data or to implement proactive license management strategies, such as harvesting idle licenses, which leads to clearer insights into actual software usage.

Achieving Full Visibility on License Usage

LicenseAnalyzer by Open iT provides professionals with access to a broad range of reports, both pre-set and custom-built, to ensure comprehensive visibility into license usage. It offers a centralized view of the consumption of targeted applications and enables the configuration, execution, and subscription to reports showing:

  • Historical usage.
  • Real-time usage within a historical context.
  • Active and inactive usage of selected and configured applications.
  • Active and inactive usage per user.
  • Active and inactive usage per user group, and much more.

Depending on the setup, IT managers or Software Asset Management (SAM) professionals can also take optimization actions such as notifying, suspending, or terminating idle applications based on set thresholds to reduce idle time and free up licenses.

Surprising Findings

These reports can quickly identify issues such as license hoarding and misuse, or anomalies like licenses being checked out over weekends. Further analysis, such as identifying maxed-out licenses or partially to completely unused features, can lead to significant insights. By integrating this information with the organization’s catalog of application costs, surprising figures can emerge.

Comparing the maximum available licenses with the number recommended based on actual usage reveals where cost reductions can be achieved. Open iT aids in collecting and contextualizing raw usage data, enabling professionals to analyze it and convert it into significant cost savings.

Preparation for Renewal Negotiations

Armed with accurate license usage data, organizations are now better prepared for renewal negotiations with vendors. Open iT is committed to helping organizations navigate the complexities of the licensing environment. To explore how Open iT can assist with your challenges, request a call with a consultant or view the solution in action through a live demo!

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