Business...it's so cyclical. We go through lush years when the primary focus is just "getting things done" and we grow fat, then we hit a slow down and we suddenly have to watch our dollars and the primary focus becomes "get it done...but don't spend any money" and we are forced on a diet.
Unfortunately, in the directive to cut costs - we don't always do it in the best fashion. There are costs you can cut in your IT budget without impacting service - they never should have been there in the first place...they came from lack of time and desire for convenience.
Where to look:
1) Software licensing agreements and maintenance plans
2) Telecommunications costs
3) Outsourcing agreements
If you don't have the talent in-house to do this, hire it out.
A reputable consultant will be able to tell you after a quick look if there is money to be saved - so you should know without incurring costs (or possibly very minimal costs) to what magnitude your savings opportunities are - they should full justify the cost of the consultant plus significant savings to your organization.
Additionally - there is money on the table when you are signing or renewing a deal. Make sure you're working with an expert who knows how to get you the most from your negotiations.
Don't wait until your budget is due to start this process...get a jump start and get it done now - you know budget time is always a crunch...
Tuesday, April 08, 2008
Thursday, January 31, 2008
Stop wasting money on your software purchases!
LOL...OK, don't misread my title...you probably still need to spend money on software purchases - my point is, you should stop the waste that goes on in most purchases.
Are you getting the most you can out of your software purchases? I doubt it. Frankly, I've proven time and time again that companies aren't...you see, there really are "tricks" to doing this right and unless your purchasing agent has lived the experience from both the consulting and the reseller side, they're not going to know them.
A couple of examples of major savings we negotiated this past year:
Are you getting the most you can out of your software purchases? I doubt it. Frankly, I've proven time and time again that companies aren't...you see, there really are "tricks" to doing this right and unless your purchasing agent has lived the experience from both the consulting and the reseller side, they're not going to know them.
A couple of examples of major savings we negotiated this past year:
- $260,000 on a $1.6m purchase through leveraging publisher relationship
- $65,000 in free services on that same purchase through leveraging vendor relationship
- $150,000 in savings on hardware purchase associated with that same software purchase
- $180,000 in savings through education on product use rights options
- $15,000 in free services on a $200,000 purchase through leveraging vendor relationship
- $52,000 in free services on a $900k purchase through leveraging vendor relationship
- $250,000 in savings through education on product use rights options
Now, these were all fairly large purchases....but percentage wise these are still sizeable dollar savings. In all cases, these companies had saavy purchasing agents...but these are not deals those purchasing agents would have been able to negotiate. It requires someone who specializes in this industry to know the ins and outs and negotiate the best deals.
CIO Insight says 44% of the CIO's reported "cutting costs" as a top priority for 2008 (http://www.cioinsight.com/c/a/Research/Management-Priorities/).
CIO's know they are going to have to watch their spend this year...unfortunately too many assume that they're getting their best deal on their software because they've compared prices and negotiated agreements. But they don't know the money they're leaving on the table.
Call us before you make that next purchase...let us show you how much money we can save you - money you can spend on new projects rather than on just maintaining your software!
Friday, December 28, 2007
A Year's Worth of Lessons in Software Asset Management
After 12 years in this industry I really wish I could claim that the problems we saw at new customers this year were different from those we've seen for the past years...but unfortunately that's really not the case.
First, there was the customer that contacted us after experiencing a BSA audit having paid out hundreds of thousands of dollars in fees and consulting dollars (lawyers, experts, etc). We assisted them in determining what they needed to purchase but they still wouldn't invest the small amount of money to put in an appropriate Software Asset Management (SAM) program (tracking software, processes, policies and product use rights education) or even consider outsourcing this issue.
Second, the customer who wanted some help negotiating a new volume licensing agreement. Unfortunately, when they had implemented their SQL Server 2005 environment with redundancy they failed to consult with an expert on product use rights (PUR's) so ended up implementing a solution requiring them to have duplicate SQL Server Enterprise processor licenses...a very expensive solution that could have been avoided with a quick phone call or e-mail.
Third, there was the customer who wanted our help in performing their Microsoft true-up. They had discussed their server virtualization project with their reseller in connection with their VMWare needs...but the reseller never asked about their actual server licenses. The 20 Windows Server Enterprise licenses they needed to purchase came as a complete surprise.
The list goes on...
The lesson to learn here is this: In Software Asset Management, spending a little money by having an expert on retainer can easily save ten-fold on your investment. Stop relying on internal staff who do not have the time or the resources to know the current PUR's on all your products, and don't take the word of anyone (including publishers, resellers or consultants) unless they back it up with publisher documentation.
I hope your 2008 is full of the positive rewards of an effective SAM program!
First, there was the customer that contacted us after experiencing a BSA audit having paid out hundreds of thousands of dollars in fees and consulting dollars (lawyers, experts, etc). We assisted them in determining what they needed to purchase but they still wouldn't invest the small amount of money to put in an appropriate Software Asset Management (SAM) program (tracking software, processes, policies and product use rights education) or even consider outsourcing this issue.
Second, the customer who wanted some help negotiating a new volume licensing agreement. Unfortunately, when they had implemented their SQL Server 2005 environment with redundancy they failed to consult with an expert on product use rights (PUR's) so ended up implementing a solution requiring them to have duplicate SQL Server Enterprise processor licenses...a very expensive solution that could have been avoided with a quick phone call or e-mail.
Third, there was the customer who wanted our help in performing their Microsoft true-up. They had discussed their server virtualization project with their reseller in connection with their VMWare needs...but the reseller never asked about their actual server licenses. The 20 Windows Server Enterprise licenses they needed to purchase came as a complete surprise.
The list goes on...
The lesson to learn here is this: In Software Asset Management, spending a little money by having an expert on retainer can easily save ten-fold on your investment. Stop relying on internal staff who do not have the time or the resources to know the current PUR's on all your products, and don't take the word of anyone (including publishers, resellers or consultants) unless they back it up with publisher documentation.
I hope your 2008 is full of the positive rewards of an effective SAM program!
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