Steps to Cut your Software Spend by 30 Percent
16 août 2017
Todd Labrum | ITAM Product Manager | Ivanti
Mark Devereux | Product Manager | Ivanti
It's time for a total asset management makeover. Making the most out of hardware and software assets is a challenge every business faces. On average, businesses only utilize 35-38 percent of the software they pay for. Inefficiencies swirl around hardware assets as well.
Join this 60-minute webinar to learn helpful tricks that help maximize the performance and value of your IT assets.
Todd: Okay. Good morning and good afternoon wherever you may be or even good evening. I welcome you to the webinar that we have for you today. We are going to cover "Steps to Help Cut Your Software Spend by 30 Percent." You have myself which is Todd Labrum. I'm an ITAM Product Manager at Ivanti. And then we also have, instead of Mark Devereux, that's what it said, he actually had another engagement to attend to. We have another individual by the name of Jonathan Sims. He's one of our SAM consultants and he's a great person to work with and a definite expert when it comes to IBM and even other vendors. Hey, Jon, I mean, just like to walk me today and could you say hello or introduce yourself?
Jonathan: Thank you, Todd. Hello, everyone. Yes, I spent the last three or four years within software asset management, doing a range of roles from consultancy to software licensing. And now it's just working with manage service customers, clients, and contracts as well.
Todd: Awesome. I'm glad to have you and as I said, I've been able to work with Jon over, actually just had a couple of months. And it's been a great time learning from him and having him be a part of the team. He's an employee here at Ivanti and based over in the U.K. So, it's been fun, as I said, to have him be a part of the team and continue to see what we're doing and moving forward. And we hope that you're able to learn what you can do today as you mentioned, back to the title, how you can cut your software spend? That's actually a stat that came from Gartner that you provide a couple of ways to go through and achieve that, and so have we in this presentation.
But before we do that, I would like us to go over the outline in what we're gonna be covering today. So, first thing is just to go through an introduction of what software asset management is? The reason I'm doing that is quite often when I'm talking with customers, they still aren't as familiar with software asset management or what it is, or what the practice is, you know, what you're trying to achieve. And so I'm going to cover that and we'll have Jonathan Sims help provide a look into License Optimizer. That is the tool that we have here at Ivanti to help customers understand what's going on with their software state. And then with that we will get to the tips and tricks on what you can do to reduce your software spend.
And lastly, I'll cover up with looking at, is this for real? I mean, that song is coming to mind when I say that. But really looking at an example and really the savings that our existing customers have already saved by using License Optimizer and going through those tips and tricks. And then just ending up with the summary. So, glad to have everybody on the webinar today and thanks for your time. And we'll definitely make sure we make great use of it. By all means, if you have any questions, please provide them in the chat window or the Q&A section on the webinar. We'll be looking at those and hopefully be able to answer those throughout the presentation. So, thank you. Let's go ahead and get started.
So, when we talk about software asset management, again as I'm looking at Gartner. Everybody loves our favorite analyst firm, right? Going through, really what it comes down to it is just a process for making software acquisition and disposal decisions. In all honesty, that's about it. So, how are you going about and purchasing software? How are you going about and seeing if what needs you have in the environment? What needs should the business have when it comes to what type of software to run efficiently or to really do their roles and be able to achieve what they want? But because it's so complex, organizations end up spending too much time and too much money on software and where they shouldn't be.
And that's why we're coming back into this. It's not more of a process of what can I do to optimize my software state? But maybe another reason is well, why? Why is this all important? There's always the security threats, right? So you wanna make sure you're going with software that's always secure an up to date, has a great release plan if you look at it from a security perspective that they're always keeping software patched. And covered from those exposures that come from a security perspective. Other reasons why, it might be a software audit. So vendors, because of the complexity of software and software licenses, and how they're actually calculated for that compliance perspective, they're coming in and auditing their customers.
And because of those audits, if customers are not using software in the right way, they are gonna get fined and that is expensive. That's yet another security risk is going on, right? So, when we talk about compliance, it's making sure you purchase the right software and using it in the right way. And if you're not, that's where those audits come in and those audits are painful. Not only the financial side of things that you get fined or the true-up that comes from it, but the time. If you aren't doing everything right, you're wasting a lot of time in responding to those audits.
The other issues that you might have are shadow IT. So, this is where any end user and in all honesty and I guess I've done this. And so as I'm sure most or everybody out there on this webinar, we go through and purchase software because we want to get going. We know what we want to use and we say, "Hey, I'm familiar with this software tool. I'm gonna go ahead and start using it and purchase it myself," and it may be expensive. Well, maybe it's a good thing but maybe it's not, right? So, when we talk about that shadow IT, that's something that the IT team isn't aware of and it's not being tracked. Other things are understanding the software lifecycle and refresh dates. So I wanna understand when software is no longer supported, especially when you look at maybe operating systems.
We always talk about quite often your XP back to you WannaCrypt, right, where that one is an older version of an operating system that wasn't probably kept up to date or patched. And there was some definite people out there that found an opportunity to expose an issue in it. So, being aware of an actual lifecycle and refresh is important. If other companies had already been able to update and upgrade, you know, to the latest patch or to a newer version, they wouldn't have that security threat. But because of all the complexity, another thing that we see quite often is overspending. Organizations are spending so much money on software and they're buying more than they need because of a fear of an audit or fear of being out of compliance.
So, again, you have those fines or true-ups, right? So, there's a lot of factors that go into why software asset management is important in making sure you have a program out there to effectively manage how you're buying and using software. Really to prove the points, we're looking at a few stats here. Back to what I was just talking about for overspends, we actually see 76% of organizations admit to spending or buying more licenses than needed because they have a fear of an audit. They don't wanna be found to be out of compliance. Some other issues that go on or other pains that might be in an environment is, well, how do you actually know what you have?
There's 50% of organizations that have 12 or more discovery tools. So, you might have discovery tools for Apple if you're thinking of like a jump, right? So, they're pretty great at Apple discovering Mac and being able to manage those. But what about Windows? What about Linux? What about Unix? What about the data center? What about IBM? What about Oracle? So, because of that complexity and all the different varieties that are out there, organizations will most often have several discovery tools. And again, you look at the lower part of that stat on the left hand side it says, 11% of organizations have more than 30 tools. So, well, why do I bring that up?
It might be important to have those tools but how are you dealing with that data? And that's where you look at the stat on the right. Again, when we're looking at having to make sure you have the right data at the right time, and it's the right level of accuracy that you need. If you don't you're gonna be wasting time resolving data accuracy issues. So, are you willing to spend additional manpower or time addressing those issues? Again, on the bottom, when you look at the software license complexity, just talking about the complexity in general. This is not what you're looking at, what is being used or what you're purchasing, but just the license complexity indirectly costs organization an average of 25% of their software license budgets, because they don't understand it.
Again, they don't realize that you can actually go through and negotiate better terms and conditions. You can actually navigate that complexity to get into better positions for you as an organization with whatever software you have against whatever vendor, whether it's IBM, again Microsoft, Oracle, Adobe, VMware, the list goes on.
So, quality had gone through unaddressed but the pains and what's really causing a lot of the SAM to rise up for that conversation or maybe initiative or objectives. The other reason behind it is the returns again, as we talk about overspend, as we talk about even understanding the usage of that software in the environment. Organizations can see a reduction in software spend because of implementing a SAM process.
So, I'm not even talking about a tool, a process that end…and it's as an end tool though. You can save up to 30% off your software spend. Other stats that we looked at is managing software can also lead to real cost savings. So, not only is looking at implementing a SAM process that helps you identify what you can reduce in software spend. If you continue to manage it, you can still lead to real cost savings by as much as 25%. Again, that's what ITAM or software asset management is all about. Again, the lowest, I mean that bottom stat talking about what type of return you can see or expect if you were to implement an ITAM program where you're helping manage the vendors and contracts that you can cut costs by as much as 25% to 50%.
So, who wouldn't want to get on that, right? So, I hope that's reiterating a fact. You're probably already aware of that and now you're saying, "Oh, yeah. We already know all this." So, what do you do next, right? So, the first thing I want to go at, to explain and explore as well, you have to get an understanding of what you have in the first place, back to those discovery tools. So that's only one step of it. So, when we talk about what do you have, what physical assets do you have? Which ones are on the network but also which ones are in the cages or in your storage rooms? Those are assets or even devices where software is installed and you are still liable for them. So, you have to understand what's not only on the network which is what usually discovery tools can find but you're gonna have to go through and do a physical audit of each location and identify all those and find those assets or devices that have software on them. And once you do that, you're now hopefully able to then track well, where is it now? And being able to stay on top of it from that point on. What licenses do you have? Who is it assigned to help identify where it's at? Who is it that actually owns that device or that software? What's its current status? What's the lifecycle? Is that something that I just recently purchased? Or is it nearing the end of its lifecycle? Well, what about contract renewals? What about license expirations? Can you actually understand its history? What about license upgrades, are you all eligible for those?
What about downgrades? You look at, well, how is it actually performing for you? Are you going through and doing product rationalization? You might have a lot of software that overlaps each other. As funny as this may sound talking about it, there's a customer I was just visiting a couple of weeks ago and they have Corel in their environment. I know everybody makes fun of that, right, when we're talking about Quattro or anything in fact to what might that used. And he actually still has it on his computer. I just noticed that even a month ago, too. But so, he has not only Microsoft Word and Excel, he also has Corel. Why? They do the same thing. So, let's go back and we talked about product rationalization and overspending. So it's an opportunity to save money. But if you don't know what you have, how can you see what products or software is actually being used in the environment?
And finally in the end, what is it costing you? And being able to see that. Again, just to reiterate what all these questions are for, you can't manage what you can't see. So, again, going back to you need to discover and find what you have on the network and off the network. You are liable for both.
So, the three components that we always need or in understanding even a compliance position that goes for both ITAM and SAM, I mean you need to have, I just talked about the physical asset or information. So, understanding what you purchased, where is it at right now, whether it's physical device, whether it's, you know, a VM or a virtual environment and what software is on those? What does that environment look like?
The second piece is the financial data. So, this is really that proof of purchase if you will of where you acquired those licenses or where you acquired those devices. That is important and many organizations are not tracking that well. If not, that's where you're running to issues with vendors when they go through a software audit. And again, going back to that, we talk about the contractual side, right? What contracts do you have in place with Microsoft? Do you have an EA agreement? Is there SA on the licenses they purchased? That entitles you to software and how you can use it. If you're not aware of those contracts then you're again wasting money or wasting opportunities. Well, what if you do have a contract in place, how can you now negotiate a better terms and conditions with them?
So, when we look at it, the next step is really to start to get to that vendor visibility and integration. There is information everywhere, right? We talked about discovery tools, you have other data sources. Whether it's even being stored in spreadsheets. I will say quite often, if not maybe 70% of organizations I've talked to are tracking their apps, it's within a spreadsheet. So, realizing data is everywhere, whether it's coming from applications themselves. So what is the usage of the application? How many people have it installed on their machines? Going to the virtual side, well, what does my not only physical environment look like but am I using virtualization on top of that? Is there clustering? That's important for certain software licenses.
Back to the HR and finance, grabbing information from them to see what, again, what assets we purchased with…whether it's tracked through our financial software or even active directory is a great source of information. So, being able to get that data from all these different sources is important. Another great source of data is from the vendors themselves or if you have a reseller, if you're working with CDW or SHI or Insight or OnPoint or Softcutter. So, the list goes on and on with that one, right? But you need to have that visibility and then integration to make sense of what you own. And that's where we have Ivanti at the center. So, as we look at this, what data… So I've kinda covered all these different types of data sources but there's even a different set of data.
On the left hand side of the screen, you'll see that there's discovery and entitlement. So, discovery, this deals with what's actually installed and what's in use in your environment. This is where those discovery tools come into play. But again, I will say you have to be aware of also devices that aren't on the network. It is what your state looks like. So, we need both hardware, software, virtualization, utilization. That is discovery data.
The second set of data is entitlement, so what contracts do you have with your vendors? What licenses have you purchased? Do you have maintenance? Do you have expirations? What are the subscriptions? All of that's important on that second set of data.
We need to understand both of those as they come into this center here to go through a process that we call normalization and reconciliation. This is the magic sauce that everybody talks about, right? This is what is happening behind the scenes and this is what SAM tools will do. They have an extensive library to understand how we pair both sets of those data together to generate what's called a compliance position. Well, ultimately, you want to go through and make sure it's an optimized licensed position or even an optimized compliance position. That is what you're trying to achieve and that is what we will cover for the rest of this webinar, is how do you get there? What are the steps and the tips and tricks that you take to get to that optimized position?
So, behind the scenes, just talking about how that works. We have licensing experts, we have one on the call with us and that's why it's often...and thanks, Jon, again for being able to be on this webinar and we'll hear from you in just a short and just a little bit. But you need those people to understand that complexity. So, then convert that understanding and to tune what we have in that center, that powerful engine that make sense of everything in the environment that you continue to add that expertise there. Most organizations are not able to replicate or even purchase. Those individuals are expensive. If you're looking for a new job, I would suggest that's one way you can go.
If you're looking to say, "Okay, hey, where can I go or how can I improve my career?" Well, if you wanna become a licensed expert for SAP, for Adobe, for IBM, for Oracle, you can make pretty good money on that, right? So, talking about that complexity. If you want to start somewhere, start there. Even Microsoft is a good one side to understand. And then overtime, we have to make sure you do a continual tuning of that engine to make sure it's up to date. So, for example, Microsoft changed their licensing around the SQL Server. Well, you have to make sure that it's always up to date, so that's what we talked about with continual tuning.
So, enough of me talking about that. We'll go over to the benefits and then we'll hear from Jon right after this one.
So well, again, back to the why. Well, with this, if you go through a process and then a tool, you'll help to generate accurate information. It will be complete, consistent, and you can be confident about that data where you can present it to not only your executive team but even to those software vendors. And if they were to submit that audit notification letter, you can say, "Hey, I already got a tool, I already know where I'm at. Here's the data, here you go." And at that point, they see that and they do learn to…and then they've been trusting us as we've gone through that with some of our existing customers, they will not come to you and audit you as often as anymore, because they realized that you're on top of it.
So, that's where you're starting to get into that efficiency, right? And in that last piece. So, there's some great benefits that you have with this. So, as I said enough of me speaking. I'm sure you guys are wanting to hear a little different and actually get a peek at License Optimizer. So, for this one, I'm actually gonna turn the time over to Jonathan Sims. And make him presenter real fast so he can share his screen. We are going to go through a live demo. So we'll see how that goes and we do have a backup in case we need it. But, Jon is gonna go ahead and take us through a quick sneak peek at License Optimizer.
Jonathan: Hello, everyone. Thanks, Todd. So, Todd's been through a few items there. This is part of his webinar. At its simplest, a reconciliation is a comparison of the entitlement that you own, the software licenses versus the liability, the installs, the usage, the utilization that you've got out and your state. And what you're able to do with License Optimizer is you're able to see very quickly and easily, of course, your whole state, all of your licensed positions. And what we're looking at here is what we call the basic view of a reconciliation. It's the data summary vendor overview and we are seeing the compliance, this is demo data, compliance for software that's listed alphabetically. You'll recognize some of these software vendors.
And you can see some key information about your compliance for those vendors and shortfall and surplus and exposure. And I'll explain those in a little bit more detail. So, being sorted by vendor name is very useful. But we might be more interested in the compliance. So, it's the percentage compliance of your licenses versus your liabilities. And what we can see here is the ones that are least compliant. And you can see, as you go further down the list, the compliance, when we get a bit further down, I promise you, the compliance will increase. There we go. And you can see, some of these are 100% compliant. But compliance in itself isn't that important either. So, it's important to be compliant.
Definitely not going to take that away from you but if you were compliant or noncompliant and you don't have enough licenses to cover the liability you got out in your estate. And the noncompliance relates to quite a small amount financially then you're probably not going to spend as much effort into addressing that noncompliant as you should be applying against a bigger exposure, what we call an exposure. An exposure is the costed liability of a shortfall. So, this is where you don't have sufficient licenses. And then in this example here, this is a dummy example where we have a shortfall of five licenses and the exposure is coming at 131.26 pounds, not a great deal.
However, if we are looking at our biggest exposures, we can sort that exposure and we can see straight away that our biggest exposure is for IBM and for Microsoft. And those are quite large exposures, we're talking over five million and over three million. But we may want to dig a little bit deeper into those exposures and we can see where those exposures are coming from. So, if we look at Microsoft and we drill down into the Microsoft tile, we can see the products and we can sort those by exposure as well. And in this case, we can see that our biggest exposures as you might guess, are around Windows Server and SQL Server. And if we wanted to, we can drill down again and we can sort by the exposure we can see our biggest exposure in SQL Server is for SQL Server 2000 Standard. And there's an exposure there of almost three quarter of a million pounds.
If we drill down again, then we can see the metrics involved. And at this point, License Optimizer starts to recommend how you might address these exposures and shortfalls. And if we wanted to drill down further still, then you would be able to see the business units that are associated with those exposures or, in this case, the actual servers, the OSIs that relate to that exposure. So, you can see those are licensed and those that are not.
The other thing that we're gonna focus on in the webinar today and Todd will come back to this a bit later is we can actually look at surplus licenses.
The surplus licenses are those that you're not using. There may be a reason that you're not using those. The product may have been retired. It may be that the licenses that you purchased cannot be used in certain business units or certain companies that sit within your organization and you have an issue there. I mean in those cases, you could potentially look at using those licenses elsewhere within your organization if you can identify those surpluses. Again, in those cases, we can sort by surplus and we can identify those vendors. And again we can drill down and see the products and the versions and the additions, the metrics where the surplus licenses are and we can identify those.
The software asset management isn't just about a one-off reconciliation. It's not about looking at where you are now and then going off and dealing with that. But it's about an intuitive process, it's about having a process in place and it's about managing. And managing implies that you do that over a period of time. But the other thing that I want to show you today within License Optimizer is the dashboard area of License Optimizer. We have a look at this standard dashboard first, but what you'll see within the dashboard or is you'll see every reconciliation that's been run in this summary environment. So, for each reconciliation that's been run those are data points and we can see there is a compliance trend that's been built up across the data points with these dates.
We also have the liability cost trend and we have other tiles that tell us our current compliance, our current exposure, and expiring [inaudible 00:26:20] that we have within the next 90 days. You can have OSI CAN information and you can also have other tiles that can add value in business information to many people within your organization. These dashboards can be customized and so if we have a look at a different view, we have a dashboard set up here for the CIA. There are a wide range of tiles to choose from and these tiles can be displayed in a number of different ways depending on what view you want. But we're gonna stick with this one and we're just gonna have a look at the ability to drill down and see the information that sits behind this.
So, License Optimizer retains all of these information. If we click on one of these tiles, then we get down to the actual data. This is the data that sits underneath that tile. We can click on the analyzer tab to choose two points on that compliance trend and we can analyze what's happened between those two points. And what License Optimizer is doing is it's going back now, it's reviewing the data and it's analyzing what changed between those two points in time to see such an increase in compliance. When that loads, you'll be able to see the estimated impact for each of these changes. But the data is always held and can always be referenced and you can actually look at the details of these hardware entitlement records.
If you could on one of these then a pane will appear here on the right hand side. And you'll be able to see the actual data that's contributed to that. But in the compliance trend, the dashboard is another area that's just worth pointing out to you as well and that's the ability to forecast compliance. So, within these slides, you're able to add a forecast position with forecast factors which will allow you to project what your compliance will be over time. And what you're able to do is identify the forecasting factors which is appropriate for your organization and use those to plot the liability that you're expecting to see in the future with your compliance, surplus, shortfall, etc. and map those on there.
And the more reconciliations that you do, what you'll find is that License Optimizer gets better at predicting what's gonna happen. So, you'll see that that forecasting line will gradually improve along with the compliance. That would be the overview of License Optimizer. I'm just gonna hand back to Todd now.
Todd: No, perfect. Thank you so much, Jon, for going through that. And I hope you guys have seen everything even though it was a brief demo. That is some great powerful tools that you have at your hands to understand really what's going on in your software state. So, when we start to look at these tips and tricks, he's actually gone through and shown a lot of those areas as mentioned. So, what we'll try to do is refer it and when we go through these tips and tricks, refer back to... Do you remember seeing this on the screen? This is what you would do on that. If I go back into mine, sorry, click into here. So, the tip number one for me, when we look at it and when I talk to customers it's you need to get visibility. No more spreadsheets, they don't cut it.
And that's where I'm at again, I'm always amazed at how many people are doing software asset management and license tracking through spreadsheets. You do not get the benefits of really understanding those downgrades, those upgrades. Your entitlement if you have SAs, if you have an EA with Microsoft. You do not have the ability to really get into the detail you need with the spreadsheet. So, that's my tip number one. I'm sorry, and I mean that just coming from us saying because we have a tool, but I really am saying that for your benefit. Again, I can't tell you how much companies are doing and wasting time and money because they're doing it through a spreadsheet.
The next step to get that visibility is understand what you're spending by vendor. That is actually quite hard for a lot of organizations to gather. But oh, it's like where again are those entitlements happening? Who's making those purchases for the software? You need to probably introduce a process in place to say that all software purchases must come through a centralized procurement model if you will. But that's one step to start to get that visibility into how much you're spending by vendor. The next step is now looking at well, what's actually in your environment and how is that software being used? Not all discovery tools will give you that detailed usage data. Again, that's important because you might not need as much software as you or as many licenses as installations because not everybody is using that software.
Why are they having it installed if they're not even using it? Just being aware of that and I'll get to that as another tip, but you need to get detailed information. From that information, you'll need to start and calculate that current compliance position. Back to it, Jon showed in that dashboard. You have that tile which tells you what your current compliance position is at this date in time. But even understanding your history as you mentioned. Understanding where it might go in the future. You need to be able to track and actually calculate that compliance position. If not, you have no clue where to go next. And that's where I'll get to maybe my second tip.
So, once you've generated that compliance position, and within again the License Optimizer and, Jon, I mean I'll go back into the demo on this one but you had talked about the surplus, right? Even from License Optimizer, we're able to detect, you have a surplus of licenses. Is that correct?
Jonathan: That's absolutely what I taught, yes. The surplus licenses are a really good point to start at because effectively, those licenses, our licenses aren't used in a reconciliation. And it's really important to understand why they are being used. Either because the product is no longer in use, and if that's the case, are you still paying maintenance on that product? In which case, there is a significant savings straight away. If it's because their licenses can't be used within the certain business unit or there is no install with that product within the business unit, then again that's something where you can look at addressing possibly exposure or shortfall in other areas of your business with those licenses. And that could be a simple call to the vendor to say, "We want to be able to use the licenses elsewhere, that is we're not using them within that company or that business unit now."
Todd: Awesome. And what can you do? So, you talked about discontinuing maintenance on licenses you no longer need. Great first place to start for saving money. Can you or have you are familiar with being able to resell any of those unused licenses? I'm just wondering.
Jonathan: So some of our clients have done. It's not [inaudible 00:33:51] on behalf of our clients but yeah, absolutely. The key point is, and it goes back to that comment you made earlier, you can't manage what you can't see. So, you can resell it but only if you know about it.
Todd: Yeah, right. And that's something that many organizations aren't aware of. I've brought up an example of a company that does this, where you can actually go on to their website, it's called usedsoft.com. And you can go ahead and you can actually even purchase some of those used softwares like your eBay if you will but for software. So, you can start to actually get money back, you can sell unused licenses to them. They'll then take those and then resell them to other companies or individuals that are looking for them. So, you can actually make some money or get some money back by doing that. Many organizations aren't aware that that's possible.
I do know that there are certain limitations within that or which types of licenses can be resold. So, be aware of that. There is information out there. If you look at it, I know on the Europe or in the NIA, the EU has gone through and provided some rulings on it. Not as much here in the US yet but there would be as much of the same type of arguments if you will. But just be aware of it is... Yeah, go for it.
Jonathan: Sorry. Also worth noting that if you got software that you haven't used, when you get into renew a situation with the vendor, then if you know about that puts you in the position of strength and you can give that back and maybe look at changing that software for other software that you know that you do need or are going to use in the future.
Todd: Awesome, that's actually one I've never heard of. So, being able to do a swap is what it sounds like. Is that the take to knowing what it is?
Jonathan: Yeah, that does happen with a lot of large vendors, yeah.
Todd: Awesome, so there you go. Yet another way to save money. And then lastly, looking at rationalization, right? This goes back to my example with that customer and I are laughing because my dad, I don't know why he's stuck on Corel but I find it funny. Either way, you wanna make sure you rationalize your application once you have that visibility. Because now you can start to see where there's an overlap. I mean you could talk about even data storage applications. So, if using a Dropbox or Google Drive or Microsoft One Drive or, my goodness, you can go through one of those, right? So, why do you have all those places to store information. See about only saying this is for our organization, this is the one that we're gonna support and use going forward. That helps to limit who you're not only working with and those extra licenses and expense for the same type of applications. But man, it's just a great way to get efficiency within that organization.
Jonathan: It has a big impact on maintenance as well because you're not paying lots of different maintenance contracts.
Todd: Exactly, so just think about that. The cost of the maintenance contract and just the volume of them if you will or the variety for the different vendors. So, tip number three. This is one, another great place to start. But again, if you don't have that visibility, you have no clue how to do this. So, when you start to look at the software that's installed, how is it being used? Maybe what you could do is introduce a nice software usage policy. And when I talk about this policy, I'm saying, okay, say for instance and I don't say I'm a culprit in for all the software that I have installed in my machine, everybody is. Can you guys go through, think to yourself. You know, I say that you've actually used every single software product that's installed in your machine at least once within the past year?
Can you actually say that for 100% of those product title or the installations that you have? Maybe I guess I'm not a betty man but I would bet on this one that you probably can't, right? So, for me, when you start to talk about introducing a software usage policy within an organization, you say, "Okay, for any application that goes unused for 90 days, for 120 days," whatever that time frame may be, "we are going to and we have the right to automatically uninstall that software from your machine." Now, I will say, one of the people say, "Well, hey, but what if I need it in the future, not to go back through and request or install it?" There is a way to go around that and that's actually at the very bottom of this list, is you're gonna actually implement a software catalog to reinstall it. And say, "Yup, you're still approved to use it and install it. Go have at it but we're gonna try to limit what software is installed on our machine so that we can keep those costs down for those licenses." So, you're introducing...
Jonathan: In your mind, while the person isn't using this software, that license maybe something that can be used by somebody else within the organization that doesn't want to use it in the next few months.
Todd: Exactly, and so that's where you're starting to get to that. You reduce the liability, you reduce how much you're spending. And you're getting to a certain level where you found, "Okay, here's the just right enough licenses to have on hand." for what Jon just mentioned. And you get to the optimized level and that's what you're looking to do. So, as you introduce those policies then you go through and identify it as what we've been talking about, and then you uninstall it. There's no reason why they should have it if they're not using it. As part of that, you could implement a software reclamation policy per product if you want and that can be automated. A great way to save time and money.
And then as I mentioned, still allowing access to reinstall it if needs be, you know, at a future time with that employee ended up needing that software again. So, those are some great tips when we talk about looking at unused software. So, we talked about surplus, that's when you just purchased too much. You now reduce that amount and now you're looking at the other end. Well, maybe I didn't need that much to begin with and that's where you look at the unused. So, again, you reduce it even further there. On the next tip and this is maybe one thing that most companies or organizations are aware of is that you start to understand the installations, the usage, and how you're licensed.
But you can focus either on now volume discounts, that is what my hope is, right, as you start to consolidate your contract and applications to the handle of vendors. You can start to benefit from volume discounts. But not only that, looking at that third one, you can negotiate better terms and conditions. This is something those organizations don't do. And there's great benefit in doing that. I've been trying to think and Jon is hopefully on the spot, but this is something that we, I mean done for someone, help I guess if you will with some of our existing customers. We can't do it for them but we can probably provide them in the right direction, is that correct?
Jonathan: Absolutely, yeah. We've done a lot of work with existing customers and numbers of existing customers to help them prepare for that next renew. And it's something that needs to be built into organization's processes. It's important that we've been able to go at and consult with them and help them to identify what that process is in, put it in as well as actually doing the work for themselves. And it's always a real opportunity for organizations to put themselves in the position of strength when they negotiate with their vendor. With a software audit, we can sometimes be a difficult situation to be in where perhaps you feel as though you're unprepared for that audit coming in.
With the right processes and policies in place, and a software asset management tool, you can be prepared for that. And I assume in a way with the renewal, you can always be prepared for that renewal. You can go into a renewal situation with all of the knowledge that you have about your state and also about your usage for the future. So, I mentioned the ability within License Optimizer to forecast. And as you saw within the dashboards, as you build up the number of reconciliations that you do over a period of time, you can see what's happening with, for example, your usage of products. So, you may see that your product usage is increasing for Office 365.
You may know about a future scenario where you're gonna be recruiting more people or bringing in, purchasing another company and add into your organization. And the other thing that License Optimizer were able to do is run a scenario mapping. So, scenario mapping gives you the opportunity to imagine what life would be like after an IT change that you're claiming to make. And with that sort of foresight knowledge, you can generate a great deal of business information that can put you in a really good position for a vendor renewal. Because you're able to tell them exactly what you're using now but also understand what you're going to be using in the next 12 months, 24 months, 36 months. However, only in the next renewal and the software support and maintenance that goes with that might be.
Todd: That's awesome. So, again, great tip and great opportunities here for hopefully many of you on this call. Then hopefully you're learning something now a few tips and tricks. And just maybe the possibilities that are out there, especially when we're talking about negotiating. I know for us here at Ivanti, talking with our IT team, that last book was just an example that I have with the Microsoft Office. We were, I would say strongly guided, forced, no, whatever word you wanna use when it came to saying, "No, every single employee within your organization used to have an Office 365 ET license." For those that aren't familiar with how Office 365 is, they have various subscriptions with different products included or I would say capabilities of how the product is delivered.
So, an E1 is like an online only version of the Microsoft Office suite or the E3 is both online and you can then install it on up to five devices and five mobile devices. So, anyway, because we didn't have the information available, we were forced to pay for an E3 subscription for every single employee in the company. Now, not everyone needed that type of subscription, not everyone needed the installable version. But we had no profiles to prove to Microsoft that, "Hey, these users only need the online version." And therefore, the smaller cost, right? And so that was something I was working with their IT team on and I believe with our next true up, we're able to be in a position to say, "Hey, Microsoft. We don't need this many E3 licenses anymore. Here's the mix of profiles that we have and here's how many of each we need."
So, back to negotiating better terms and conditions with Microsoft on that. And then lastly, we're looking more at maybe time efficiency is really the last tip that we have. Once you've gone through, those others all deal with the software state, the spend, so it's more of us. I know it's not physical but I wanna put my air quote there and talk about its physical. Something you can actually track a little bit easier for an ROI. Now, tip number five, when we talk about time efficiency, that is a little bit harder to track but is nonetheless still valuable. So, when we talk about that, using a tool will help you get that efficiency you need because software is complex. If you're doing it again through spreadsheets, you're not gonna get there.
There, again, another company I visited with, I would say there is one individual who is a member of the ITAM team. And I will say he mentioned 90% of his time is spent in Excel. That's dealing with data again and understanding software and that complexity and everything. Ninety percent of his time was doing that, so why? Right? It comes back down to that question. You can implement that software portal as we already talked about that helps to facilitate the ease of software request and installation. They can automate that. There should be no reason why you can't. Another one I tell you about is for responses, we do have a whitepaper on this when we talk about audits.
The time it takes to respond to an audit, I don't remember the stat but I want to say it's around 190 hours. You look at that is a law of time for an IT team to respond to an audit. So, as you start to implement a tool and to get the data on hand, readily available, you also can introduce another process into that place of here is how we're going to respond to the audit. I'm gonna create an audit response team. Here's the steps that we have to go through and respond to that audit. And, again, that is exactly another, I don't know if we did a webinar, I can't remember that. It was maybe a year or so ago. There is a blog I wrote on that and we do have a whitepaper. So, looking at what are the ten steps to respond to an audit. Making sure you just have that in place.
Even having that in place will help you be more efficient than not having it. Other options available, if you just do not have the time or resources to do this, you can outsource. There are a lot of companies out there that do this through managed surpluses. I know that's what I guess we are doing and that's why we have Jonathan Sims on the call. He actually works with a couple of our customers. And we are managing the software state for them. So, that is a great way to make sure that at least you're getting that efficiency but maybe also utilizing resources that you might not have access to or that expertise to understand well, how to do all these. So, that is the last tip. I mean, Jonathan, last thing. I'm just wondering from your perspective, is there anything else you would add to these?
Jonathan: I think just to reiterate some of the points that we've made earlier on actually in terms of the savings that Gartner said that you can make by implementing process and having a tool. The process itself is obviously very important. But as you've said, software is complex, particularly in the data center. And that complexity can lead to a lot of risk around exposure, where you don't have enough licenses to cover what you've got installed out there. But it can also lead to those surplus licenses, where you're over-licensing, you're buying more licenses than you need. And as Todd has said, Excel just isn't going to cut it. It's going to take a lot more time and effort to use Excel to gather all of the data that you need and then work at your license positions.
The product License Optimizer allows you to do that and make that part of your day to day process. It becomes as simple as clicking a button and running a reconciliation to see what your license position is. And if you have the ability to do that, then you can always be prepared. You can always be prepared for an audit. You can always be prepared for a renewal, and it allows you to see your state and therefore manage it. And as Todd said earlier, you can't manage what you can't see.
Todd: Awesome, thanks Jon. There is a question that came up and as we go through looking at the benefits. The question that I believe it's talking about, so they had a case where they're essentially managing a number of licenses I'm guessing. But they have separate clients and we need to identify them separately or provide it a view of their state across anyone. So, I guess the best way and we didn't really cover that…I'm even thinking within an organization, you'll have different cost centers, different GOs, different ways that you want to view that information. And yes, you can actually go through and assign licenses. If you've gone through and have this information, you can assign a license to a particular GO, a particular business unit, a particular cost center, or a client.
And at that point, on that dashboard, you can actually create specific views that they only have access to that level of information within that hierarchy. They can't see above them, they can't see...they can see below them, right? But they can't see anything with their peers or above them. I guess, is that right? I mean, Jon, I know we didn't go through that but tell us about what I'm thinking your question was. It's not re-added into the Q&A section.
Jonathan: So, Todd, I don't know if you just want to maybe just allow me to present and I can show the business units view for the participants before we jump into the last section perhaps?
Todd: Yeah. We got seven minutes. I'm wondering, huh, okay. Let's see, I mean I don't wanted to go through with the presentation just to do it, but maybe this slide just talk about an idea of maybe like a size of customer and what's available. Because there's another question that came in and we talked about how you benchmark their costs. So, I go back to that first tip, you need to get that visibility. The only way you can benchmark their costs is understanding what they're spending in the first place. And then from that point on, we can actually start to gauge, okay, how much is actually possible? You now look at the, again, what's being installed and used in the environment. You look at what's being unused.
But you'll see that we've kinda built these tips on a logical path to help you get to that answer. And this is for Michael Swanton. So, when we manage it, yeah, we do benchmarking. We can track it, we can see the historical cost, that trending information that you saw in the dashboard. And then when we talk about comparing to an industry average, we're getting there. Awesome question, that's what we want. You'll probably see more of around industry coming in 2018, so that's on a road map. Good question though. So, Jon, I know you might wanna go back into that but maybe I just do a quick recap. Here are our existing and actual License Optimizer customers. Here's the size of their environment just to give you an understanding.
And then what software vendor that was focused on and what savings they were able to achieve. So, you'll notice even for small companies around the 2,000 to 2,500 size, we were still able to save one to three million dollars. So, you think about that, even for a company of that size. Now, yeah, and I'm not probably able to talk about the last one in the webinar, the Global Pharmaceutical but let's just say that $15 million, it's actually quite a bit more than what they saved. So, it's quite a bit higher than that. But, again, that was what, we're just putting on there just because either it doesn't seem like an actual number. But also the team didn't want to expose it because they didn't want to be saying, "Oh, we're not doing our job effectively because in a way, wasting that much money was IBM and Oracle, right?"
So, these are actual savings from customers. This is what through that tool that Jon, I mean License Optimizer, it was what Jon took us through earlier. Here's yet another customer within the first three months. They were able to have a cost avoidance savings of just shy at the million dollars. So, that's one of our customers from Sealed Air. Another customer, same thing, cost avoidance of $100,000 within the first month of using the tool. It is actually real. This is not a gimmick. I'm laughing because I've been on some webinars where you go through that, right? Reach on be like the... Was it get-rich-quick schemes? Yeah, I'm not on those all time trusting, but it is funny to listen to him. But just to recap, it is that simple, right?
We're talking about gaining visibility, focusing on that surplus, then focusing on the unused software. That is the biggest steps you can take to start saving money. And then you can really focus in negotiating better terms and conditions and looking at time efficiency after that. All of that will help lead you to success for a SAM solution or really for your software spend. So that being said, I don't know if there's any other questions. But if you're still willing to jump on, I think we can go ahead and show you, Jon, if you want to do that within the last four minutes. Now, go ahead.
Jonathan: The very point of view of what we can do within License Optimizer is how the product works. And this is a business unit view, hopefully you can all see this now. And you can see the way that the business unit is structured. So, within the age of our business unit, we have a number of countries here and then we might have a number of locations. So, those business units can be used in the reconciliations but also within the dashboards. So, within the reconciliations, you can choose to run a reconciliation just for a specific business unit or for a number of business units. But if you wanted to, you can also fill through the dashboards. In each tiles, you're able to filter anytime just specific business unit either on the dashboard lies at the time.
Or if you wanted to, you can configure a dashboard tile to always show specific business units and nothing else. To finally close that other bit out, you can have a number of users. There's no limit on the number of users that can log into License Optimizer. But each of those users can be restricted by the business unit as well. So, if you only wanted a user to be able to see business units in the AsiaPac region, in the example that you've just given, then you would be able to limit them to those business units.
Todd: Awesome. Thanks so much, Jon. Hopefully that answered your question Keith and it gave you an idea of how that would be doable. But that ends our presentation. So I'd really like to thank everybody for jumping on the webinar today and for Jon and Ericka who's also here helping out, and then really, we'll have an email sent out with a link to this webinar along with the recording, so you'll have access to the presentation. But again, thank you so much for your time and hopefully you're able to learn something. I'd love to hear back from you. If you have any other comments or questions, by all means we're always open here at Ivanti and we wanting to help you out. So, thank you so much and again thanks, Jon, for joining.
Jonathan: Thank you everyone. Goodbye.