Here We Go Again...

Let's take a walk down memory lane....the year is 1994 and a mid-size national firm (1,200 PC's) has a new software manager who realizes that the firm needs to be buying their software on a volume license, so she starts down the path of finding out everything she needs to know to make this happen.

Since there's no one she can find who can educate her on this, she turns to her reseller...who invests a lot of time and energy into educating her. Finally, time comes to seal the deal and another reseller walks in the door and tells her a few more things that the first reseller didn't tell her....things that would have a strong impact on the financial viability of the purchase.

Time passes, this software manager continues to learn and comes to realize that there were even more things she should have been told that neither reseller told her...that money was lost on the deal because she hadn't known them when the deal was made. Unfortunately, there hadn't been anyone to advise her that didn't have a vested interest in the deal.

Fast forward to 2008, that software manager (and yes...that was me) would no longer have to rely on the advice of a reseller...there are instead a number of small Software Asset Management (SAM) consulting firms that would appropriately advise her on all important aspects of the deal - helping her make the right choice and the best deal for her business.

However; we have to be careful that this valuable source of independent information remains available to consumers.

Most major resellers are now starting up SAM consulting businesses in response to publisher requirements. Here's the problem with that...since consulting isn't the primary business line a reseller can price their consulting services at a price that an independent firm can't compete with...and the next thing you know, the only source of information for you on that major purchase is someone who has a vested interest in the outcome...

Are we coming full circle? I hope not - the reason I started my firm in 1999 was because I saw a need for companies to have someone on their side of the deal....whether it's me or another small SAM firm, I don't want companies to lose that independent perspective.

What are your thoughts?

Realistic IT Budget Cuts and Finding More Money...

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...

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:

• $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!