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Best practices can yield 30 percent in software cost savings, study finds

July 22, 2016

Many organizations can cut spending on software by as much as 30 percent by implementing three best practices for software license optimization, according to new research from Gartner Inc.

"The variety of license entitlements also makes it tough for IT leaders to spot savings, especially in environments with many software publishers and titles," Gartner research director Hank Marquis said in a press release. "But it's worth pursuing, as spending reductions contribute directly to the bottom line as gross profit."

Between May 2015 and March 2016, Gartner queried more than 800 clients about software asset management tools. Organizations with mature software license optimization processes automated with SAM tools reported reducing software expenses, on average, by 30 percent within the tools' first year of operation, researchers found.

According to Gartner, the keys to savings are the following:

1) Optimize software configurations

Software from large publishers has complex and costly use rights. The default configuration for most software is normally the most expensive for clients as well.

IT leaders must look for savings in the configuration of software, especially data center software.

"Such changes appear simple in hindsight, but they are not obvious, and your savings could be in the millions of dollars," Marquis said.

2) Recycle software licenses

Software license recycling involves the recovery of unused license rights for reuse to avoid new license purchases. This reduces software spending as well as support and maintenance costs.

A user might have a piece of software installed but never actually use it. Software asset management tools can provide metering to identify unused, underused or misused software.

3) Use software asset management tools

Optimizing complex licenses manually is labor-intensive; it requires specialized knowledge and does not scale.

Larger enterprises will need a software asset management tool that can automate, accelerate and improve manual processes. It can pay dividends over manual alternatives, and can often pay for itself.