What are the best ways to track and report on software license costs and savings?

1 Define your software license metrics

Tracking and reporting on software license costs and savings begins with defining the metrics that align with your ITAM goals, such as reducing costs, increasing utilization, avoiding audits, or enhancing security. Common metrics include total cost of ownership (TCO), return on investment (ROI), license compliance, license optimization, and license utilization. TCO is the sum of all costs associated with acquiring, maintaining, and disposing of software licenses over their lifecycle. ROI is the ratio of the benefits gained from software licenses to the costs incurred. License compliance measures how well your software usage matches your licensing agreements and avoids penalties or fines. License optimization is the process of finding the optimal balance between software demand and supply. License utilization is the percentage of software licenses that are actively used by authorized users.

2 Choose your software license tracking tools

The next step to track and report on software license costs and savings is to choose the tools that will help you collect, analyze, and present the data. Depending on the size and complexity of your software portfolio, you may need different types of tools. Software inventory tools can scan your network and devices to identify the software installed, the versions, the license types, and usage patterns. Software license management tools store and manage your software license agreements, entitlements, and compliance status. They can also automate tasks such as renewals, upgrades, or reharvesting. Lastly, software license reporting tools generate reports and dashboards that show key metrics and trends of your software license costs and savings. These tools can also provide alerts, recommendations, or forecasts based on the data.

3 Implement your software license tracking processes

The third step to track and report on software license costs and savings is to implement processes that guarantee data accuracy, consistency, and timeliness. This requires collaboration between stakeholders such as IT managers, procurement officers, finance staff, and end users. Examples of software license tracking processes include a software request and approval process, which defines how end users can request new licenses and how IT can review and approve them; a software deployment and activation process, which defines how IT can deploy and activate licenses on devices; and a software monitoring and optimization process, which outlines how IT can monitor usage and performance of licenses, identify and resolve issues, and optimize license allocation.

4 Communicate your software license tracking results

The final step to track and report on software license costs and savings is to communicate the results to the relevant audiences, such as senior management, business units, or external auditors. To ensure your communication is clear, concise, and compelling, highlighting the value and impact of your software license tracking efforts, you should choose the right format and frequency depending on the purpose and audience. Additionally, you should customize the content and message to meet the needs and expectations of your audience. Lastly, providing context and insights that explain the data can make your communication more meaningful and actionable.