With the Covid-19 pandemic having a sustained impact across global businesses, and with it looking to continue through the end of 2020 and into 2021, it’s no surprise that industry leaders are looking for cost-cutting measures in order to ensure the longevity of their organizations. And this anxiety is being felt across the IT sector – not just from those at the top.
Regardless of how long the current pandemic lasts, there’s no denying the fact that it will irrevocably change the way that businesses operate moving forward. One of the key challenges that IT Managers and CIOs anticipate in the post-Covid era is a tightening of budgets for headcount, IT projects, and software. And that’s before you consider that many workforces will now see remote working as a viable alternative to the office, which has been the default for decades.
As Certero’s recent Beyond the C Word Report demonstrated, nearly 60 percent of IT Managers and CIOs, from businesses across the world, are anticipating a recession and the challenges that it will bring.
One of the most important steps that organizations will need to take in the post-Covid world is to ensure that they have a full view of their IT estate – from what they own, what’s being used effectively, and what needs licensing. IT Hardware, Software, SaaS and Cloud Asset Management solutions will play a key role in helping businesses develop clear strategies for how to handle their entire estate and create a more cost-effective environment from top to bottom.
But while many sectors are facing the prospect of redundancies and mass staff lay-offs, there are ways in which organizations, especially those with a large IT reliance, can streamline their processes in order to become more efficient. This will not only help save money in the long run but also save jobs.
Now is the time to discuss the importance of Software and SaaS Asset Management in developing a more cohesive, cost-efficient IT estate.
And in a post-Covid economy, that could be invaluable in helping to save jobs across an organization.
1. The importance of licensing & auditing
Software Asset Management (SAM) solutions can produce effective cost-cutting results for businesses, but in a Covid-19 context, this is even more important. As the virus swept the globe businesses found themselves rushing to facilitate remote working, whether this included the purchase of new software or changing how existing software was deployed.
According to Certero’s Beyond the C Word data, 1 in 3 IT Managers and CIOs have stated that software licensing is a major challenge. This is as remote working setups make it more difficult to properly discover, inventory, and track the usage of software applications. As devices are now outside the corporate network, IT asset visibility is now more important than ever before, if you can see the device you can't manage the licenses, security and the associated risks.
As we move toward a recession, it’s vitally important that businesses know exactly where their money is being spent and why – A dedicated ITAM and SAM solution will enable IT to get a full view of the estate and allowing them to optimize licenses and reduce risk through asking questions such as:
- What software do I have installed?
- Is software deployed in accordance with usage rights?
- How many licenses have been purchased?
- What is my effective license position for my key vendors?
- Are all of the users actively using this software?
- Are all of the users using the full functionality or could they be on a cheaper license?
Similarly, Software Asset Management isn’t just fundamental in streamlining costs, it also has a huge part to play in safeguarding against hefty fines that could be incurred from an ill-timed audit. According to Certero’s data, 36 percent of IT Managers and CIOs were worried about their compliance position due to their organization’s shift to remote working, with over 20 percent expecting to see an increase in auditing in a post-Covid environment.
The rush to adopt home-working setups could have left some businesses exposed – software incorrectly deployed against existing terms or software deployed without sufficient licensing. And without a SAM solution, it would be difficult to truly understand your compliance position, making the potential risks of an audit even greater. So, having a comprehensive SAM solution which provides complete visibility of your organization’s software licensing will eliminate the risk of being fined for non-compliance; preventing a cost that many businesses cannot afford to suffer in the post-pandemic economy.
2. Cutting costs from cloud assets
In a very similar vein to understanding your compliance and licensing position, a SaaS Asset Management solution solves some of the inherent issues controlling SaaS applications which have been enabled to facilitate remote working – allowing businesses to save money on unnecessary expenses.
The four biggest ‘cost risks’ to organizations with regards to SaaS and Cloud environments are Cloud Sprawl, Toxic Consumption, Bill Shock and Shadow IT.
Cloud Sprawl, or the uncontrolled proliferation of a business’s cloud instances, is common when an organization has poor visibility of their cloud estate. As services were hastily provisioned to support working from home en masse little consideration was given to how they would monitor and track these assets going forward. This poor control and visibility leads to multiple cloud instances being provisioned and purchased when it may have been more commercially viable to consolidate. Whilst the majority of CIOs (43 percent) we spoke to said that this wasn’t a huge concern currently, a Cloud and SaaS Asset Management Solution would be beneficial in determining whether certain environments are financially necessary, or whether better rates can be negotiated. As companies rushed to facilitate remote working Cloud instances were likely set up in a haste meaning cloud sprawl is likely to be prevented.
Shadow IT, in a parallel sense, can expose businesses to unregulated costs if a SaaS Asset Management Solution isn’t in place to detect the issues. With large swathes of the workforce converting to remote setups there is an increased risk of employees purchasing and installing software without the oversight of the IT department. This can easily lead to mismanagement, incurring unnecessary costs as a result as organizations miss out on bulk discounts and fail to consolidate technology. Shadow IT also brings security risks as IT has no visibility of where company information may be potentially being stored. This is clearly a concern for IT Managers, with 40 percent of our respondents labelling it as such. But, as with Cloud Sprawl, the right SaaS management solution can help reduce hidden costs and maintain compliance across your IT estate. As a result of Covid-19, shadow IT is rife, as individual departments did whatever they needed to ensure the business kept running smoothly, SaaS applications were likely set up on credit cards and expensed. This poor visibility is likely costing your business money as there is no opportunity for technology consolidation, bulk discounts and license optimization.
Toxic consumption is the unnecessary use of cloud resources due to poor visibility, where the need for a resource may have ended but the environment continues to incur unnecessary costs. As budgets are reduced organizations need to ensure that they have full visibility of their IT estate and to ensure that they are not wasting money on resources that they are no longer utilizing. As we now adapt to the new normal of working we need to ensure we have full visibility of resources that may no longer be required.
Bill shock is where poor performance and capability planning leads to costly and unexpected bills. With the haste at which the workforce was made remote it is likely that organizations are now starting to see large and unbudgeted expenditure. Organizations must have the ability to track and trend the usage of their cloud estate from the number of users to the amount of resources used. This vital data will ensure that they can forecast upcoming expenditure and look for areas of cost optimization as early as possible.
3. Assisting the hybrid model
It seems fairly likely that a lasting impact of the pandemic will be a cultural shift toward home working – whether that’s full-time or, more likely, a hybrid working model. In this ‘new normal’ Software, SaaS and Cloud Asset Management will play a key role. It will be the place of IT Managers and CIOs to ensure that every remote worker has access to the correct software, that the organization is compliant, that they are only paying for software they need and use, and that security risks are safeguarded against or eliminated. And as we’ve seen above, having robust solutions in place to manage your Software, SaaS and Cloud estate will continue to assist with cost-cutting and planning as part of its day-to-day implementation.
All of these functions will make the ability to work from home faster, easier and safer for organizations and their employees, presenting it as a more viable option. This could mean that businesses save money on rent costs as they transition to a hybrid working model, with proper control and management guaranteeing effective performance in and out of the office.
Without the guarantee that these solutions offer, businesses would be exposing themselves to unnecessary financial and security risks by choosing to adopt a more flexible working strategy.
In a time of economic uncertainty, it’s vital that businesses choose solutions that can help reduce waste and make their organization more cost-effective. Effective management of your IT estate is essential to ensuring that organizations remain compliant, security risks are averted and, most importantly, unnecessary costs are reduced. By investing in the right technologies, businesses can put processes in place that save money and jobs, providing a future for their enterprise and their employees.
John Mattinson, Operations Director, Certero