22nd September 2023
"Software is eating the World"
In 2011, Marc Andreessen argued that every company, regardless of industry, must master technology and adopt software solutions to survive in the digital era. He foresaw that software would revolutionise every aspect of business and society. The rest, as they say, is history.
Software is at the heart of every business, helping us work faster, smarter, and more creatively. Serving as a tool for enhancing productivity, efficiency, and innovation, it also introduces significant challenges in terms of risk, complexity, and expense. Balancing these factors to ensure the effective use of software has become a strategic concern across the whole organisation.
In this evolving landscape, much is at stake, and businesses must adopt new strategies to manage their software. Simply allocating software licenses to users and then hoping for the best is not enough. It is vital that software management is strategically aligned with business objectives and contributing to overall organisational success.
License optimisation is about maximising your software investments. It involves understanding the licences you own and how they are being utilised, while ensuring you are not overspending or underspending.
When done effectively, license optimisation not only leads to substantial cost savings, but also enhances overall productivity, ensuring that all teams have the tools to innovate and advance the business. By leveraging the insights gained from license optimisation, business leaders can make informed decisions to further their strategic objectives. In a software-driven world license optimisation is a strategic enabler, fostering business growth and driving competitive advantage.
Figure 1 - License Optimisation: The Strategic Enabler
CEO (Chief Executive Officer): Strategic Vision, Growth, Innovation
“40% of UK CEOs believe the tech skills and understanding of their teams lag behind the demands of their strategic objectives.”
Nearly 98% of CEOs (weforum.org) plan to modify their business models within three years. Aligning company capabilities with the strategic direction is vital to ensure success. Effective license optimisation will ensure the right tools are in place to drive productivity, agility, and innovation, no matter the organisational changes made. Data from license utilisation can highlight workforce skills gaps and provide an accurate return on investment for software to inform future investment decisions. Misalignment can lead to skill gaps, wasted investments and mismatched tools that hamper growth.
CFO (Chief Financial Officer): Cost Optimisation, Risk Management, Forecasting
"35% of spending on SaaS applications at most organisations is wasted"
Software licensing has significant financial implications for companies. Global spending on software is expected to hit $1 trillion in 2024. The finance team must manage these costs closely to oversee the company's financial health. Actively optimising licenses is essential to control costs and align budgetary needs.
A robust software license optimisation strategy improves financial visibility and accuracy, avoiding waste (due to over-licensing) or unexpected costs (due to under-licensing) and penalties (due to a lack of compliance). A lack of visibility and control can lead to significant unforeseen expenses and disrupt budget planning and financial forecasting.
CHRO (Chief HR Officer): Engagement, Talent Management, Culture
"Only 30% of employees say their experience with their company’s technology exceeds their expectations"
HR leaders aim to create a positive and productive work environment that bolsters employee performance, development, and well-being. License optimisation ensures that employees have the best tools and necessary skills to succeed in their roles. Effective optimisation of licences improves employee productivity and enhances job satisfaction, ultimately increasing engagement and retention. By understanding software utilisation, HR leaders can highlight any skill gaps, allowing for tailored training and skill development, ensuring software adoption, and maximising the return on the software investment. Aligning software with individual and team needs reinforces a company’s commitment to a culture of empowerment, continuous learning, and collaboration. Likewise, it assists in creating a compliance culture to strengthen the company’s security posture.
CPO (Chief Procurement Officer): Savings, Value Creation, Supplier Relationships
"Today, many organisations have a software portfolio double in size compared to five years previous"
License optimisation is crucial for the CPO. By ensuring that the company purchases only the necessary software licenses, CPOs can drive significant savings and prevent unnecessary expenditures. This approach enhances the value derived from each software investment and improves overall operational efficiency. When the procurement team clearly understands current and future software requirements, they’re in a stronger position to negotiate with vendors and secure favourable terms. Furthermore, diligent license management ensures the company stays compliant with software agreements, thus minimising the risk of legal complications.
CSO (Chief Security Officer): Protection, Risk Mitigation, Compliance
“Only 5.5% of IT Leaders claimed, “complete visibility” into how many of their employees were actively using licensed software”
Understanding and optimising software usage provides CSOs with additional insights to safeguard assets and reduce risks. License optimisation can detect unauthorised, unused, and outdated software. By tracking usage trends, CSOs can address vulnerabilities early and choose software aligning with the companies changing work practices. License optimisation offers a holistic software view, which bolsters security by maintaining stringent access policies, identifying risks, and ensuring uniform policy adherence. Mismanagement of your software estate can risk data integrity and compliance, posing significant business risks.
CIO: Digital Transformation, Innovation, Business Value
"Software accounts for 28% of the IT budget spend in 2023 "
Spiceworks Ziff Davis, 2023
Despite current economic pressures, software spending is forecast to grow by 13.7 % in 2023 and 14.1% in 2024 (Gartner, 2023) 9. For CIOs, managing software licenses and understanding usage is crucial for delivering on transformation goals. Understanding software usage allows for the optimisation of essential tools for employees and the removal of redundant ones, thereby enhancing digital workflows and operational agility to boost employee productivity. By fine-tuning software license allocation, significant savings can be realised, and redirected from ‘keep the lights on spend’ into innovation. Without optimisation, CIOs will not only have difficulty advancing their transformation agenda but also face challenges in collaborating to meet the strategic objectives of other leaders.
As technology evolves and the licensing landscape becomes even more complex, mastering licence optimisation is no longer ‘optional’ but a necessity that every company must pay attention to.
Explore Hublsoft’s license optimisation solution today and ensure your company thrives in a software-driven world.
Act now. Optimise your software and secure your future.