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If your organization is like most, you're caught between a rock and a hard place when it comes to software licenses. Your teams shout "more, more!" while your budget screams "less, less!"
The solution is to proactively manage software license usage and tie that to the specific software entitlements. This goes beyond standard Software Asset Management (SAM) and moves the organization to Enterprise License Optimization (ELO). ELO can help you stretch your software license budget and deliver more software at less cost -— a business outcome most organizations today want to achieve.
While the dependence on high-value applications, such as those offered by IBM, Microsoft, AutoDesk, Oracle, and SAP, continues to grow, economic conditions have forced companies to severely limit their software budgets. At the same time, vendors are responding to the same economic conditions by raising their prices to extract more revenue from existing customers.
SAP, for example, has moved its customers to a premium support service that costs 22 percent of their base licensing fee, an increase from the standard 17 percent. Oracle has increased the cost of certain options for its database by as much as 40 percent, and processor licenses for its diagnostic and tuning packs went from $3,500 in 2008 to $5,000 in 2009.
Enterprises also face more aggressive software license auditing processes and more complex licensing models. The growth of virtualization, resulting in a "virtual sprawl" of software instances, has increased the potential for non-compliance and much higher licensing costs.
Unfortunately, most organizations have been slow to develop visibility into license usage, and many suffer from massive shelfware, especially when they go through mergers and acquisitions and have no accurate insight into total software spend and usage.
Enterprise License Optimization (ELO) to the rescue
ELO practices can be viewed as a significant enhancement to conventional SAM, enabling a new level of insight and financial discipline for the ownership of business software.
The key elements of successful ELO include:
1. The ability to capture relevant usage data from high-value applications. SAM technologies are typically unable to show the usage of the various components of back-office applications. ELO-enabled technologies, however, make it easy to extract sophisticated usage data, including such subtleties as indirect access.
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