The Department of Government Efficiency (DOGE) recently claimed that many federal agencies hold more software licenses than they have employees—many of which remain unused. This isn’t just wasteful; it highlights a missed opportunity for government software optimization at scale.
Without centralized oversight, usage visibility, or a clear optimization strategy, agencies risk overspending, underutilizing assets, and failing to comply. A modern, data-driven approach to government software optimization can help agencies reduce waste, improve cybersecurity posture, and realign IT resources toward mission-critical priorities.
This article outlines the cost of missed optimization, the barriers agencies face, and the practical steps they can take to drive measurable change.
The Cost of Missed Opportunities in Software Optimization
The data is alarming—a Government Accountability Office (GAO) report found that only two out of 24 major federal agencies had robust software license management policies. Consequently, agencies often overpurchase licenses, pay for unused software, or unknowingly violate compliance requirements, incurring substantial penalties.
At the Department of Defense (DoD), one review uncovered significant underuse of licensed tools—contributing to an estimated $2.5 billion in lost productivity. NASA faced similar issues. Without a centralized optimization framework, the agency lost $35 million in value through non-compliance and idle software tied to mission-critical operations.
These cases are not exceptions—they reflect a system-wide challenge. Without proactive government software optimization, agencies will continue to waste taxpayer dollars and fall short of modern IT efficiency standards.
Software licenses aren’t just operational tools—they’re strategic assets. Optimizing them is key to fiscal responsibility, cybersecurity resilience, and mission readiness.
What Effective Software Optimization Enables
- Cost Savings: Eliminating unused licenses, consolidating redundant software, and negotiating smarter vendor contracts can recover millions in federal spending.
- Improved Compliance: Avoiding penalties and ensuring adherence to licensing agreements reduces both financial and legal risks.
- Enhanced Security: Outdated or unused software licenses can expose agencies to cyber threats.
- Optimized IT Resources: Accurate insights into software usage enable agencies to allocate resources effectively.
While the benefits are clear, achieving them isn’t always straightforward—many agencies still face several roadblocks that prevent agencies from achieving effective software license management.
What’s Holding Agencies Back from Software Optimization
- Complex Licensing Agreements: Agencies often grapple with deciphering intricate vendor terms, resulting in over-purchasing or underutilization.
- Lack of Centralized Oversight: Software procurement frequently happens in silos, with individual departments acting independently and lacking full visibility of enterprise-wide usage.
- Inadequate Tracking Mechanisms: Without automated tools, agencies cannot accurately gauge license utilization, leading to unnecessary spending.
- Evolving IT Landscapes: The transition to cloud computing and subscription-based models brings new challenges in managing and optimizing software assets.
How Agencies Can Accelerate Software Optimization
Federal agencies must act decisively to break the cycle of software waste. The following strategies can help agencies regain control and drive smarter software investments:
Implement a Centralized License Management Framework
A unified software asset management strategy is vital. Agencies must create a central authority to oversee license procurement, usage tracking, and continuous optimization.
Leverage Automation for Real-Time Tracking
Manual tracking is both time-consuming and error prone. Agencies should implement automated systems offering real-time insights into software usage, revealing opportunities for cost savings and compliance enhancements.
Conduct Regular Audits and License Reviews
Periodic audits enable agencies to identify unused licenses, maintain compliance, and renegotiate vendor agreements to align with real software demands.
Train IT and Procurement Teams
A well-informed workforce is crucial. Training teams on best software asset management practices supports them in making data-driven purchasing decisions and avoiding unnecessary expenses.
Adopt a ‘Cloud-Smart’ Approach
As cloud-based software becomes more prevalent, agencies should rigorously assess licensing models for cost-effectiveness and scalability. Paying only for what is used, rather than holding unused static licenses, is essential for modernizing federal IT infrastructure.
The Role of Policy in Government Software Optimization
Proposed legislation such as the Strengthening Agency Management and Oversight of Software Assets (SAMOSA) Act seeks to enforce stricter oversight and accountability in software spending. If passed, it would mandate detailed reporting on software license procurement, utilization, and optimization, ensuring taxpayer dollars are spent judiciously.
Why GSA-Certified Vendors Are Essential to Software Optimization
One effective approach for federal agencies to strengthen their software license management is partnering with GSA-approved vendors specializing in license optimization. Companies like Open iT provide advanced tools and expertise to help agencies:
- Gain comprehensive visibility into software usage and compliance risks
- Identify and eliminate wasted software expenditures
- Optimize cloud and on-premise license agreements to align with actual needs
- Automate reporting and audit preparation to ensure regulatory compliance
Why Now Is the Time to Optimize Government Software
Federal agencies can no longer treat software license management as a back-office concern. Every dollar lost to unused or mismanaged licenses is a dollar diverted from mission-critical priorities.
To move forward, agencies must:
- Strengthen oversight through policy and process
- Adopt tools that provide real-time usage visibility
- Promote accountability across departments
This isn’t just an IT concern—it’s a matter of fiscal responsibility, operational efficiency, and public trust. The path to eliminating software waste starts now—with informed decisions and measurable action.
Open iT, a GSA-certified software license management vendor, specializes in advanced tracking, analysis, and optimization of engineering and technical software assets. By focusing on key engineering applications—such as CAD, PLM, CAE, BIM, CAM, digital twin, and data modeling tools—Open iT equips organizations with deep visibility into software usage, helping them reduce unnecessary costs and boost operational efficiency.
With more than 25 years of industry experience, Open iT has consistently delivered proven solutions to Fortune 500 enterprises and mission-critical sectors, including engineering, energy, automotive, manufacturing, aerospace, defense, and government..
