8 Best Practices for Tracking and Managing Software Licenses for Your Business

Today, most firms are shifting from on-premise to cloud software and the “Bring Your Device” policy. As employees use this software remotely via their own devices, the danger of noncompliance rises significantly. Therefore, software licensing management is currently more important than ever for enterprises.

Management of software licenses is essential for firms seeking development in regulatory compliance. Failure to develop an effective license management strategy severely compromises an organization’s IT security program, raises software costs and legal fees, and decreases productivity.

How does software license management help?

Software license management entails more than just tracking renewals and use. In addition, it involves the management of software inventories and distributing software licenses to employees and teams for maximum productivity.

IT asset management (ITAM) and IT service management (ITSM) are business management techniques for IT assets and IT services. Software licensing management and software asset management (SAM) are vital aspects of ITAM or ITSM.

In today’s corporate climate, central IT planning is a formidable obstacle. Numerous major organizations choose decentralization, which provides the flexibility required for separate business units to remain competitive. And although this is advantageous for particular business units, it might result in high IT costs.

Central IT saves software expenditures by monitoring installations, use, and settings by making crucial license allocation and purchase choices. A software licensing management platform makes managing even highly dispersed expenditure choices easier without compromising critical flexibilities.

What is license management software?

SLM enables organizations to implement, maintain, and monitor software licenses, subscriptions, compliances, etc. It assists firms in reducing expenses, tracking software licensing, and avoiding fines and penalties for noncompliance.

The procedure enables the organization to comprehend its software licenses better and invest in acquiring software assets.

Software licenses are valuable assets that need more excellent monitoring and maintenance than traditional assets. In contrast to tangible assets like machinery and furniture, software solutions have usage limitations, violation of which results in legal action.

In addition, tracking the program is difficult due to its intangibility and extensive dissemination. Therefore, good licensing management is essential for the running of any business.

The basis for software asset administration

At its foundation, SAM has three primary drivers:

• Compliance: Use transparency to manage costs, risks, and complexity
• Optimize your licenses by understanding what they contain and how you’re utilizing them
• Use SAM insights to reduce licensing expenses and save time

What are the advantages of SAM?

SAM is the corporate approach that reclaims money and optimizes savings by actively regulating and automating software license acquisition, usage, and deployment. With a software license management plan in place, organizations makes more brilliant software licensing decisions that save costs and safeguard the business’s investment.

Selecting your primary software providers

Management of software licenses is a process, not a destination. You’ll need help to handle everything, so choosing certain providers is essential for effective software licensing management. However, which ones do you begin with? Here are some guidelines for selecting which software companies to prioritize:

IBM, Microsoft, Oracle, and SAP are typically at the top of the list.

Consider your stakeholders and select a vendor who will bring them tangible advantages. A larger effort, such as version migration or cloud migration, is imminent.

Do you have a contract renewal approaching with a large vendor?

Existing suppliers whose complicated licensing metrics or contracts make it particularly difficult to guarantee compliance and develop a license overview?

Knowing which vendors, to begin with, also aids in defining your SAM project’s scope and determining specific, actionable objectives. This will position you and your stakeholders for success with SAM.

Remember to collect data to highlight the situation. Obtain pertinent information, including reports, invoices, and anything else that might enhance your case.

Best practices for licensing management software

Keeping these foundations in mind, let’s review eight recommended practices for effective software licensing management as we go deeper into SAM strategy.

Document and standardize your procurement procedures – It’s crucial to know who purchases software licenses for each business unit and how. Ensure that you develop uniform strategies and standards for the acquisition of permits and defined processes for the storage of licenses and licensing certificates.

1. Streamline and organize your license inventory: Utilize this as a chance to construct a central license inventory (if you don’t already have one) and add all licensing agreements and software maintenance contracts. Establish a system of organization (responsible individuals and procedures) that allows you to locate license paperwork and information conveniently.
2. Determine your licensing metrics: In order to determine how many licenses you require. Appoint a licensed administrator to oversee and maintain your inventory.
3. License your software: It’s time to utilize your software license tracking tools to determine what software is installed in your environment. Regulate software titles to ensure that licenses match them.
4. Check the inventory of all of your systems, including open-source ones: When licensing your software, it’s often easy to overlook anything installed on systems that aren’t actively running or connected to the network. Install discovery tools on all systems to make sure everything is included. Inventory open-source systems (such as Linux) since even if the operating system doesn’t require a paid license, there are chances of its running software that does.
5. Determine software usage: Here is your opportunity to determine when and how a program title is installed (or not, e.g., cloud), configured, and accessed. You’ll be shocked by the disparity between what you possess and how It’s utilized.
6. Measure the number of licenses required per software usage: Once you’ve cataloged your whole system and collected usage statistics, it’s time to check your licensing inventory and ensure that your licenses cover all software installation and usage scenarios. Utilize product usage rights to maximize the value of your licenses and save expenses.
7. Keep your licensing and software inventories up-to-date: This is where the detective work comes in. Consider licensing types corresponding to your software consumption patterns and IT infrastructure, and track usage to ensure compliance. In the meanwhile, regularly update the following:
   
   • a. Software titles that monitor users who are downloading new software, updating applications, or joining the cloud
   • b. Information on software usage and IT environment
   • c. The license inventory to record contract milestones, new purchases, and license modifications such as upgrades and downgrades.
8. Handle your licenses more effectively: Voila! The productive outcomes of your SAM process and data transparency will enable you to use your licenses more effectively. You’re now able to discover precisely where you’re over and under-licensed. With this knowledge, reallocate your existing licenses to meet your requirements, saving money on new licenses and lowering audit risk. It’s essential to pay attention to upkeep! If you aren’t utilizing a license, you’re advised to terminate the maintenance agreement. Utilize your SAM knowledge during contract renewals to secure better terms for your organization.

How to measure the success of licensing software management?

Establishing initial program accomplishment criteria (KPIs) that measure and acknowledge the program’s success is vital. This prepares you to market the results of your SAM implementation to stakeholders and the more significant business. Consider balancing proactive and reactive objectives when you divide your software licensing management project into smaller, more manageable portions with reachable targets. Create a plan for routinely communicating your successes to stakeholders.

Software license administration is simple if you know what to look for

The administration of software licenses has aided tens of thousands of businesses in improving their compliance and efficiency. It’s time to adopt these procedures and render your business immune to legal action.

Effective software licensing management ultimately frees up your time. You can concentrate on genuine business prospects rather than handling compliance requirements.