Wednesday, March 10, 2010

Resellers and Publishers in the world of Software License Management

I woke up this morning to a great Twitter from a good friend and great coach Jak Plihal ( It was the quote:

"It is hard to get a man to understand something, if his living depends on him not understanding it." by Upton Sinclair.

To me, this perfectly explains the relationship between resellers (VARs, LARs, and any other acronym that is responsible for selling you software), software publishers and the details of software licensing.

There are details in software licensing agreements and product use rights that can be turned to a benefit for a company in legally reducing their software licensing costs...but you're not going to find them all out by asking your reseller or publisher for help.

Why? Not because they are necessarily trying to mislead you or keep you in ignorance - instead it's because they honestly don't even think of those options...because their living (or magnitude of it) depends on them not thinking of those options.

Now, there are definitely some that are better than others (I love working with Softmart for example as their reps have demonstrated to me a strong ability to keep the customer's needs in focus) but as long as their income relies upon what you buy then Upton Sinclair's quote will continue to apply.

When it comes to negotiating the best deal for licensing - the bulk of the savings opportunities comes from making full use of the product use rights and volume licensing agreements terms - not from the discount you negotiate (or not from the discount you negotiate without knowing these items intimately). Get your advice and education from an independent expert...know in advance who profits from your purchase and what their motivation is so you can better analyze their advice.

Remember, "It is hard to get a man to understand something, if his living depends on him not understanding it." Upton Sinclair.

Thanks Jak!


Jak said...

Thank you. It seems that we run into this systemic challenge all over the place... here in Washington D.C. the entrenched reality is a key part of all the earmarks and pork that has people (rightfully) less and less trusting of the federal government.

That said, more and more people are delivering honest solutions -- moving us all forward. Thank you for being part of the solution.


Anonymous said...

Well, that quote applies even more to the customers we want to sell SAM services to. If their licensning is so mismanaged for so long, risk is that the customer would get fired once the reality is uncovered. So they keep convincing themselves and their boss that they do not need help ;)

Cynthia Farren said...

To the last commentor - you're absolutely correct...the quote can easily also apply to some IT managers who feel it would be unhealthy for their career to look to closely at their licensing.

As we all know - you can't manage what you don't know so for any that are in fear...your wisest course of action is to first find out your situation and then chart a course of attack for solving it...we can help, you don't have to do this alone!

Anonymous said...

When looking for an independent negotiator to assist with large scale software renewals such as Microsoft - what type of questions would you suggest to add in an RFP to ensure you are getting the value they propose?

Cynthia Farren said...

Good question about Q's for the RFP. We can all throw out numbers of what we say we can do (the latest I heard was saving over $1billion a year on a 10k seat Microsoft agreement...uh...very questionable! LOL). You want to know that there is a solid (verifiable) track history and specifics for what they will do for you and how results are quantified.

1) What is the expected outcome
2) What specific actions/options will be used to accomplish the outcome
3) How will the outcome be measured
4) What are the areas of potential savings (make sure it goes beyond the T's & C's of the agreement and beyond simply beating the reseller's price down...look for something that truly differentiates this company)
5) Verifiable examples of prior work (references)
6) What makes them unique

This isn't extensive, but hopefully it will give you a good start. Be sure to include us in your RFP!