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Success with Software Asset Management: Global Manufacturing Firm Takes a Strategic Approach to Reducing Costs

The Objective

Many companies face the challenge of answering questions related to software purchases, such as, what licenses do you own, where is it deployed, and what does it cost you? A recent audit prompted a large global manufacturing firm to enlist Ness’s help to better understand the cost and tracking abilities of their software and license asset management. The firm acknowledged that the amount of money spent on software purchases was out of control and needed to confidently be able to answer the question, “Where are we today?” to avoid future costly penalties. In order to move forward, they had to enlist Ness’s help to prove that they could self-fund all of their next steps in their business plan. Part of this was helping to diminish their financial cost, and another part was Ness uncovering that they were improperly taxed.

The Strategy

Our team of experienced Asset Management experts conducted a thorough assessment of the firm’s governance, processes, practices, tools, and data for IT Shared Service (ITSS). After doing so, we established a baseline of the current state and developed a business case and strategic roadmap to achieve an agreed upon future state for Software Asset Management. The Ness Assessment not only uncovered opportunities to reduce software spend, improve the processes, procedures and technology necessary to standardize and improve the management of software, but it also uncovered opportunities to recover millions of dollars spent on unnecessary software sales tax.

Once Ness was contracted for the assessment, the client-stated objective was to build a business case that could self-fund the necessary improvements that needed to be made to Software Asset Management. Ness succeeded identifying opportunities that not only would self-fund the three-year strategic roadmap to improvements but would also fund the development of an ITAM Office to govern ITAM long term.

The Results

As a result of the assessment, Ness identified $3M in cost recovery opportunities and $16M in cost avoidance in software licenses. Ness’s efforts resulted in a business case that allowed the firm to fund the critical steps for the project, as well as provide a recommended roadmap for a long-term strategic approach to Software Asset Management. Savings opportunities were not only identified for this year, but a significant monetary recovery/reduction was realized with the refund of tax on software licenses from four years. Due to Ness’s dedication to the assignment, they went above and beyond to prevent future expenses but also remedy previous expenses as well.