© 2003 deloitte & touche – not to be used or reproduced without deloitte & touche’s...

© 2003 Deloitte & Touche – Not to be used or reproduced without Deloitte & Touche’s permission

Software Asset Management

Managing IT Investments


Microsoft Licensing Insights

11, 13 & 14 March 2003

© 2003 Deloitte & Touche – not to be used or reproduced without Deloitte & Touche’s permission

Software Asset Management - SAM

Overview of topics covered:

What is SAM and what does it mean to me?

How to implement a SAM program and manage

your software efficiently

Eliminate unnecessary IT spending – Microsoft

Volume Licensing best practice


• Grants owner the legal right to use or Grants owner the legal right to use or access a software programaccess a software program

• Usage governed by vendors license Usage governed by vendors license agreement and copyright lawagreement and copyright law

• Intellectual property copyright remains Intellectual property copyright remains with the vendorwith the vendor

What is a software license?


Why invest in IT?

• Expedite achievement of business goals•

Work faster

+ Improve quality

+ Minimise cost

= Competitive Advantage



•Comprehensive approach to improving ROI

Two focus areas:

• Minimise costs and investments; and

• Meet and exceed business requirements


Total Cost of Ownership

The Costing Model

Only 12% of the total cost spent on s/w and h/w

18%

20% 100%

24%

18%

2%6%12%

Support

Mgt

HW/SW

Dev

CommsEnd user

Down time

TCO


Early SAM Attempts

• Set of procedures to identify usage

• Ignored financial/contractual/technical details

Why did early attempts fail?

• SAM was seen purely an IT issue

• Lack of consideration of the needs of the organisation as a whole -> SAM should touch every part of your organisation


Upper Management

• When administered intelligently:

Promote communication and coordination

Provide performance criteria

Defines responsibility

Force planning

Key Players


Purchasing & Accounting

Procurement

Record keeping

Accounts Payable (AP)

Q: Can AP determine whether to pay invoice?

? Is the vendor honouring all Terms&Conditions

? Maintenance contracts been approved

? Agreement cancelled

Key Players


IT administration/help desk

• Negotiate better licensing deals

• Improves decisions on upgrades and support

• Assist with deployment

• Proactive not reactive

• Maximise help desk services

Key Players


End Users

• Defines end user vs IT responsibilities

• Educate on IT policy and procedures

• Gives an insight into IT Strategy

• Promote consistency with the end-user

Why did we upgrade?

Key Players


Why is SAM important?

License Compliance

• Vendors normally view unintentional misuse sympathetically

• Must demonstrate compliance efforts

• Intentional non-compliance not tolerated

The Cost

Public embarrassment

Substantial financial penalties

Personal liability for company directors



Decrease Risks:

•Acquisition

•Risks

Unauthorised purchase of licenses

Licenses purchased but not readily locatable

Overpayment of license fees



•Distribution/Deployment

•Risks

Lack of control over where software is installed

Unauthorised duplication of software

•Monitoring & Reporting

•Risks

Software usage is outside license conditions

Under licensed products

Over licensed products


SAM Pitfalls

• Purchasing an electronic monitoring tool

without a SAM program in place

• ‘Silver bullet’ solutions

SAM efforts are likely to stall


Recommended Approach

• Assess your own circumstances

• Look to a phased implementation

• Adopt the most appropriate elements as everybody is different:

Small Business

Multi National

Public Sector

Private Entity


Phase OnePhase One Phase TwoPhase Two Phase ThreePhase Three Phase FourPhase Four Phase FivePhase Five

Developing a SAM program

Phase OnePlanning and Budgeting Define responsibilities

Phase TwoEstablish Procedures

ProcurementDeploymentManagement

Phase ThreeDevelop Policy

Phase FourEmployee Education

Phase FiveSelf Assessment



Planning and Budgeting

• Identify business objectives

• Assess infrastructure needs

• Identify existing resources

• Research available opportunities

• Capture within budget



Planning and Budgeting

•A comprehensive budget should incorporate:

– Hardware & software

– Training

– Development

– Management

– Support

– Downtime

Support

Down time

Management

Training

HW/SW

Comm/Dev



Define Responsibilities

• Contractual: Master - Enrollment holder• Who is responsible for:

• Implementing SAM• Planning & budgeting• Monitoring compliance • Developing SAM policy

& procedures

Appoint a software manager?

‘Sends a strong signal’




Phase OnePlanning and Budgeting Define responsibilities








PROCUREMENT

MANAGEMENT

DEPLOYMENT

Establish Establish ProceduresProcedures



Procurement

• Through normal purchasing channels

– How much does it cost to raise a PO?

– What is the most cost effective process?

• Formalise the process - eliminate historical questions

• Avoid reconstructing license

parentage - difficult without good SAM• Buy from a respectable Microsoft Reseller• Visit: www.howtotell.com &

www.microsoft.com/ireland/compliance

PROCUREMENT

MANAGEMENT

DEPLOYMENT



CASE STUDY

• Decentralised construction company

• No clear procurement policy; purchases also on decentralised level.

• Purchase of FPP, Open• Over-licensed on several applications,

under-licensed on Office pro

PROCUREMENT

MANAGEMENT

DEPLOYMENT

Procurement



Q: How can we address this?

A: Invoice verification

• Have all IT related invoices forwarded to IT dept prior to payment

• As process evolves develop a link with accts payable

PROCUREMENT

MANAGEMENT

DEPLOYMENT

Procurement



Deployment

• Access to software is limited

• Authorisation for loading is defined

• Product to be loaded is clearly stipulated

• Software register updated once installed

• Home usage is managed

• Disposal of old media controlled

PROCUREMENT

MANAGEMENT

DEPLOYMENT



Management

Pitfalls

• Use of spreadsheets or small custom built database

• Process almost guaranteed to fail as it becomes to complex and onerous

PROCUREMENT

MANAGEMENT

DEPLOYMENT



Recommendation

• Look to a dedicated ownership

management tool capturing:

- What was originally paid- Recurring costs- How and where was it acquired - H/w & s/w interdependencies - OEM - Reference to software license library

Management

PROCUREMENT

MANAGEMENT

DEPLOYMENT



•Establish good record keeping systems

Hardware Inventory

Software in Use Inventory

License Inventory

Media Inventory

Management

PROCUREMENT

MANAGEMENT

DEPLOYMENT



Management

PROCUREMENT

MANAGEMENT

DEPLOYMENT

CASE STUDY

• European Media group

• Suspected of being uncompliant

• LAR had system problems

• 30% of licenses under wrong contract.



Q: How can we address this?

A: Reconcile PO to invoice and license confirmation

Why adopt this type of approach?

– Physical deliverable to control payment

– Reseller focuses on processing as payment depends on it

– More efficient than a macro level assessment

– Identifies errors close to when they occur

Management

PROCUREMENT

MANAGEMENT

DEPLOYMENT


What is my ‘Proof of License’ ?

• Acceptable ‘proof of license’ is determine by the method in which the software was procured. For example:

Retail/OEM product: Certificate of Authenticity (COA)

Volume licensing product (Select/Open): On-Line license confirmations

Purchase Orders Invoices Reseller confirmations

What does not constitute Proof?



Proof of License for Retail Products

As of the Launch of XP

Prior to XP



Proof of License for OEM Products

Operating Systems ApplicationsPhase OnePhase One Phase TwoPhase Two Phase ThreePhase Three Phase FourPhase Four Phase FivePhase Five


Proof of License for Volume Purchases

OpenSelect and Enterprise



Historical Proof of License for Select (prior to e-License)





Phase OnePlanning and Budgeting Appoint a S/w Manager








Develop Policy

Need to address:

- Planning - H/w and s/w retirement

- Acquisition - License Documentation

- Installation - Version Control

- Compliance - Auditing

-.

Policies should have threat of disciplinary sanctions associated with them.



Develop Policy

• Signed by all employees and contractors

• Made a condition of employment

• Documented on the Intranet



Employee Education

• Target education at all employees

• Program should:

- Explain s/w code of ethics and SAM policy

- Discuss s/w piracy and why it’s a problem

- Explain the hidden costs of illegal software

• Combine with other IT related issues• Backing up user data• Internet and Email use• Security



• An assessment to determine compliance

• Internal or external

• Should be regular - at least annually

• Use of a discovery tool

• Provides second half of the data needed

• Redeploy assets not being utilised

• Remedy any under licensing

Self Assessment



Selecting a tool

• Limited list of tools• Not an endorsement

GASP 5 Suite SMS Express Software Manager

ZenWorks PC Profile MSIA (Microsoft)

www.microsoft.com/piracy/samguide/tools/www.microsoft.com/piracy/samguide/tools/sit.aspsit.asp

Self Assessment


MSIA Report Example


One Minute SAM Take Away

• SAM is a process not an event

• Should touch every part of your organisation

• Avoid ‘silver bullet’ solutions

• Look to a phased approach

• Financial, contractual and technical data just as important as usage data


Software Asset Management - SAM

Overview of topics covered:

What is SAM and what does it mean to me?

How to implement a SAM program and manage

your software efficiently

Eliminate unnecessary IT spending – Microsoft

Volume Licensing best practice


Microsoft Licensing Specifics

• Software Assurance

• Client Access Licenses (CALs)

– Per Server / Seat / Processor

– Internet Connector

– Core CAL

• Select

• The Open License program


Software Assurance

• Focused on:

• Streamlining administration

• Reducing acquisition costs

• Correcting former inequities

• Product implementation and security

• Predictable budgeting

• Promoting program consistency


Streamlining Administration

• Eliminates the need to maintain numerous license confirmations

• Replaces a confusing collection of upgrades

– Version Upgrade

– Competitive Upgrade – License

– Product Upgrade – Software Assurance

– Language Upgrade – L+SA

– Upgrade Advantage


Client Access Licenses (CALs)

Key Key PointsPoints::

• Needed to access server software with another device eg. PC, workstation or terminal

• Is not software! It’s a legal document that grants access to the services of the server

• Is a separate license and is not part of any operating system eg. Windows 95/98 or NT


Client Access Licenses

• Per Server

• Per Seat

• Per Processor

• Internet Connector

• Core CAL

5 options for licensing server clients:5 options for licensing server clients:



Per ServerPer Server

• Only Windows 2000 Server

CAL

CALCAL Server

License



Per SeatPer Seat

ServerLicense

ServerLicense

• Windows 2000 Server

• SQL Server 2000

• Exchange 2000

• System Management Server 2.0

• Microsoft Mobile Info Server

• SharePoint Portal Server

CAL CAL CAL CAL



Per ProcessorPer Processor

• Host Integration Server 2000• Internet Security Acceleration Server

2000• BizTalk Server 2000

• Application Centre 2000

• Commerce Server 2000• SQL Server 2000 • Microsoft Operations Manager

Vendors

Partners

Customers

InternetFirewall

Internal Clients

ProcessorLicense



• Internet ConnectorsInternet Connectors

InternetConnect

orLicense

CustomersInternetFirewall

• Provides access to an unlimited number of anonymous users over the Internet


Core CALs

• License server components across all desktops within the firewall

• Includes a CAL for:

– Windows Server

– Exchange Server

– System Management Server

– SharePoint Portal Server

• Core CALs sold with Software Assurance attached

• Clients will always be licensed regardless of the server version deployed


OEM Licensing

• No additional license needed to use older version operating system if OEM is Windows XP Pro

However, end users may not:

- Use multiple versions simultaneously

- Transfer Windows XP Pro to a 3rd party

• Restrictions on renting and leasing removed from Windows XP Pro EULA

• Network installation now permitted – supports implementation enhancements in Windows XP


Programs Benefits:Programs Benefits:

• Instant access to softwareInstant access to software

• Easy to understandEasy to understand

• Valuable investmentValuable investment

• Broad range of software titles Broad range of software titles availableavailable

• Convenient license acquisitionConvenient license acquisition

• eSelect electronic license deliveryeSelect electronic license delivery

Microsoft Select


Open Subscription License

4 different Open License flavours:

Open Business: • Initial order minimum of 5 licenses

Open Volume: • Initial order minimum of 150 pts per pool

Open Subscription License (OSL)• See next slides

Multi-year Open (MYO)• See next slides


Open Subscription License

• Requires minimum of 5 pc’s

• Facilitates standardisation: Microsoft Office Professional

Microsoft Windows Professional upgrade

Core CAL – can now select which components are covered

• During the time of the agreement your PC count may increase or decrease

• Annual payment

• Fixed rental price per PC at different Price Levels - based on your desktop count:

• 3 year rental period - buy out option at the end of the subscription

• Includes Software Assurance (L & SA)

• Multiple subsidiaries can purchase under the same subscription

• Faciliates ease of administration


Multi Year Open - MYO

• Target Market Another option If you were planning to go for Open + SA Small / Medium Company wishing to standardise on one or

more of the platform products – 5 to 250Pc’s

• Type of License Perpetual License Spread payments over 3 years @ 0% Finance SA Included Price cheaper after 3 years – can then buy SA only 2 Types – Volume & Enterprise


eOpen

eOpen - Electronic License Delivery

• Open License offers electronic license delivery, for tracking license confirmations

• eOpen allows you to:

- View Open License information for one or more authorisation numbers

- Create and retain personalised views of license purchase history information

- View Open License purchases made in more than 180 countries


eOpen – screen shot


Questions you should ask yourself

• Questions you should ask yourself:

– How easy is it for your employees to copy software?– Do you have standard applications in place?– What software is being used?– Do you have enough CALs?– Do you have enough licenses for all the software in

use?– Does it all tally up (software licenses to software in

use)?• Consider:

– Software Assurance– Open License Subscription

• Microsoft want to help

© 2003 deloitte & touche – not to be used or reproduced without deloitte & touche’s...

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