Webinar- How Software License Optimization Empowers IT Procurement

© 2016 Flexera Software LLC. All rights reserved. | Company Confidential1
How Software License Optimization
Empowers IT Procurement

Speakers and Agenda
Eric Feldman
Senior Product Marketing Manager
Flexera Software
@EricJFeldman
Agenda:
• License complexity
• Software Asset Management drivers
• Maintaining compliance and reducing
costs
• Managing cloud infrastructure
• Key Takeaways
Joe Freda
Chief Financial Officer
Flexera Software
@JoeFreda_CFO

You Are Probably Over-buying Software
Software license complexity will indirectly cost
organizations an average of 25% of their software
license budgets in 2016
- Amy Konary, IDC
>>Click here to Watch this Webinar On Demand Now<<

But You Are Under-buying Licenses Too
65% of enterprises are audited 1 or
more times each year
14%
9%
23%
19%
21%
15%
How often have you been audited (or had a license review) by your
vendors within the last 18-24 months?
More than 3 times
3 times
2 times
1 time
We have not been audited or had a
license review within the past 18-24
months
We have never been audited
65%
How many times have you been audited in the past
year?

And Software Audits are Costly
20% of enterprises have audit
true-up costs of more than
$1 million…
Not to mention labor costs!
2%
6%
12%
9%
15%
56%
What was your total software audit/license review true-up cost
within the last year for your organization?
More than $10 million
$5 million to $9.99 million
$1 million to $4.99 million
$300,001 to $999,999
$100,000 to $300,000
< $100,000
20% pay > $1 Million

Software Asset Management Program Drivers
Managing Entitlements
Software Audits
Overspend
Reducing Manual Effort

How Do Software License Optimization Tools Help?
Automated Tools Help Manage License Complexity
Product Use Rights Library:
• Upgrade / Downgrade
• Second Use Rights
• Virtual Use Rights
• Disaster Recovery / Backup Rights, etc.
• Points Tables (PVU, etc.)
Built-in License Intelligence

Control Software Costs, Manage Contracts
Contract
Expiration
Areas of
Over-Spend

Maintain License Compliance – Reduce Audit Cost
& Risk
Publishers
in Breach

Enterprise App Stores Proactively Help Maintain
Compliance and Reduce Costs
• Automate Software Request, Approval & Delivery
Process
• Check for Available Licenses
• Automate the License Reclamation Process

Negotiate Better Software Contracts
• Visibility into Software Usage and Trends
• Recommendations for License Types to Best Meet User
Needs at Lowest Cost
• Right-size Software Maintenance
• Leverage Global Enterprise Agreements

Achieve Greater ROI
Savings Due To:
• Audit Cost
Reduction
• Labor Savings
• Reduced
Maintenance Costs
• Software Reuse
Ability to Negotiate
More Favorable
Contracts

Case Studies
*Case Studies are from a May 2016 TechValidate Survey

The Drive to the Cloud
Market Shift
• Spending for cloud services is growing at 5X of other IT spending
• At least half of IT spending will be cloud based by 2018 (IDC)
• 83% of all new software application purchases in the cloud
• 77% of organizations have an initiative to access compute power in
the cloud (Constellation Research)
• Operating Expense (OpEx) vs. Capital Expense (CapEx)
of Enterprises using
Hybrid cloud by 2017.
(source: Gartner)
Size in 2015;
26% annual growthCloud Market
(source: Market & Market)
Market Shift

Cloud IT is Growing – Traditional IT is Shrinking
• Cloud IT spending will reach $53.1B in 2019
– CAGR: 15.1% (IDC)
• Traditional IT spending will shrink to $62.3B in 2019
– CAGR: -1.7%
$-
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
2014 2015 2016 2017 2018 2019
IT Spending - Cloud vs. Traditional IT
Cloud IT Traditional IT

Software in the Cloud
Cost Savings– but only if closely managed
Complexity
New SAM
Challenges
Still have
License
Compliance
Risk

Why Customers Need Better Cloud Management
• Customers lack visibility
into cloud spend &
utilization
– Understand per business
unit and company wide
spending
– Identify under-utilized
resources
– Track usage and spending
patterns
• IT & Procurement need
to manage cloud spend
and resource usage
Unmanaged Cloud can
be a Dark Cloud

The Challenge of Not Managing the Cloud

% Utilization
% Utilization
% Utilization
% Utilization
% Utilization

Managing Traditional IT and Cloud IT
Capability Traditional IT Cloud IT
Hardware Asset
Management
Track location of desktops
and servers
Manage IaaS and PaaS
subscriptions
Manage maintenance
contracts
Track & maximize
utilization of instances
Manage hardware lifecycle
(acquisition to disposal)
Optimize spend
Software Asset
Management
Track software
deployments
Manage SaaS
subscriptions
Manage compliance Manage compliance of
BYOSL in IaaS
Optimize spend with SLO Optimize spend with SLO

Enterprise-Wide Data Collection
Required Capabilities
• Aggregate billing and usage
information from multiple
accounts
• Classify spend and usage
• Configurable based on
business requirements
Business Value
• Reduce time consuming
manual effort
• Align cloud service billing to
organization hierarchy
• Up-to-date visibility into usage
and spending data
AWS

Managing Cloud Infrastructure
Complete 360 degree view of cloud usage and spend
• At-a-glance visibility and control of cloud spending
• Align cloud usage to business needs
• Reduce waste due to low utilization

Cloud Cost Analysis
Required
Capabilities
• Trend analysis
• Monthly
spending
projections
• Insight into
spending
based on data
classification
Business Value
• Choose the
most cost
effective
instance type
• Enables better
budgeting and
financial
management
Visibility of on-demand vs. reserved instances

Cloud Usage Analysis
Required
Capabilities
• Utilization of
reserved
instances
• Instance
utilization rate
• Instance usage
trends
Business Value
• Maximize
utilization of
cloud instances
• Eliminate idle
cloud instances
to reduce
waste

Key Takeaways
• 65% of companies face a software audit at least once per
year – and many will pay over $1 million for true-up costs
• Enterprise app stores help proactively maintain
compliance and reduce costs
• Automated software license optimization tools help
manage complexity, reduce the risk of audits, and provide
the data needed to negotiate better contracts
• To manage the cloud, you need the right data across the
enterprise
• Cloud does not remove the need for IT Asset
Management or Software Asset Management
– If anything, they become they become more important!

For More Information
SLO Blog
http://blogs.flexerasoftware.com/ELO
Twitter
@SAMInsights
Web
www.flexerasoftware.com/SLO

For more information go to:
www.flexerasoftware.com/SLO

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