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Will India take to SAM

A clear cut SAM policy will not only help reduce software piracy but it will also help enterprises raise their productivity. By Chirasrota Jena

With the increasing use of software across the globe, CIOs have to grapple with challenges such as software licensing, configuration management and security issues. Software Asset Management (SAM) is all about the infrastructure and processes that are necessary for the effective management, control and protection of software assets within an organisation through all stages of the software lifecycle.

SAM recognises software as a critical business asset and it is the right approach to tracking license usage, solving problems, cutting costs and maximising ROI from infrastructure. It is a well-established business practice. Businesses that habitually save millions are starting to analyse and come to terms with software usage patterns, asset inventory, detailed contract terms and volume-related purchasing power.

Software prices aren’t in free fall unlike that of hardware. Today, software costs can quickly consume the average IT budget. That is why an increasing number of organisations are turning to SAM to manage and control their software costs.

The developed world has acknowledged the critical role of SAM in maintaining the dynamic software infrastructure of organisations. SAM is a key element of corporate governance in the US and the UK. In most developed nations, SAM is a vital part of modern business management.

Recognising SAM

According to Akhilesh Tuteja, Executive Director, Information Risk Management Practice, KPMG, “SAM is a concept, which leads to the adoption of best practices and principles regarding software asset management across an enterprise. It provides a framework that guides companies to derive maximum value out of their investment in software assets.”

The trouble with software is that too much is just as bad as too little. An effective SAM program can cut the Gordian Knot and ensure that the optimal number of software licenses are purchased.

"With SAM, an organisation can keep tabs on its software assets. It is capable of reporting on a wide range of IT devices including servers, routers, desktops and laptops along with the software that runs on them" - A S Sivaprakash Manager- Technology Specialists Novell India

Software vendors are keen on this concept. Microsoft is investing in developing an ecosystem of certified partners who will be delivering SAM related consulting services to customers who are interested in implementing a comprehensive program. The vendor considers SAM as an approach to help customers realise the full potential of their software assets. It is enabling customers to learn, evaluate, deploy and improve SAM.

A S Sivaprakash, Manager - Technology Specialists, Novell India, elaborates, “It is difficult to put a number on SAM as it may either be a feature in a system management product or a part of an overall IT asset management deal. However a guesstimate can be made on the basis of the IT asset management market projection for the Asia Pacific region. It would be approximately $8-10 million.”

He adds, “We are working closely with our channel to reach out to organisations that have stated that their key IT challenges are with regard to auditing, compliance and are maintaining IT budget spend. A part of this effort is also targeted at enabling the sales and technical teams of channel partners to address requirements related to ITIL and asset management.” 

Oracle has introduced enterprise asset management as a part of Oracle’s 11iE business suite that addresses the comprehensive maintenance requirements of asset intensive companies. This tool will help organisations craft asset management strategies, which will ultimately help them optimise equipment management and improve ROI.

The sunny side of SAM

Good software asset management can help an organisation determine what software it needs and thereby help it save money. It can also help an organisation take advantage of volume license discounts.

A study by Gartner states that implementing SAM effectively can help a company save 25 percent of its IT spend. There are various benefits of having a clear cut SAM policy. It standardises the software versions in a company and boosts productivity and collaboration.

Explains Sivaprakash, “With SAM, an organisation can keep tabs on its software assets. It is capable of reporting on a wide range of IT devices including servers, routers, desktops and laptops along with the software that runs on them. An organisation can pare its hardware and software, maintenance and support costs, reduce legal exposure and face software audits with confidence. 

"SAM improves planning by raising an alert when a piece of software becomes obsolete and replacing it with a newer version" - Ajay Advani Co Chair BSA India Committee

Ajay Advani, Co Chair BSA, India committee, says, “Having a SAM policy improves planning by raising an alert when a piece of software becomes obsolete and replacing it with a newer version. It also helps a company realise the potential tax benefits associated with forward purchases of software prior to year-end financials. It improves business continuity as it does not base critical business functions on unstable, unlicensed software.”

The right SAM policy can eliminate unauthorised copying by users contravening licensing agreement. It also eases the process of mergers and acquisitions by ensuring that there is no software duplication and no paying for unecessary licenses.

Awareness levels and challenges

As companies find themselves needing to comply with a slew of regulations, SAM with an ISO standard can help them. As Indian businesses become software enabled, they need to transform their perception of software from being an expensive tool to being a business asset.

"The existing level of awareness of the concept of SAM in India is about 35 percent. It stands at 65 percent for large corporates but is as low as 30 percent in SMBs" - Brain Campbell Director Genuine Software Initiative, Microsoft India

Says Brain Campbell, Director Genuine Software Initiative, Microsoft, India, “Having touched a cross section of user companies with information on SAM, it has been found that the existing level of awareness of the concept of SAM in India is about 35 percent. It stands at 65 percent for large corporate houses but is as low as 30 percent for Small and Medium Businesses (SMBs).”

Understanding of the concept is limited and many large enterprises have just begun to understand that SAM processes are an effective tool for corporate governance as well as a standard which are needed as part of a successful business strategy. Microsoft is partnering with industry bodies, including Nasscom, BSA, FICCI and CII to reiterate this message and start an awareness campaign.

At this moment generating awareness and addressing concerns of customers are the principal challenges for software vendors. The mindset of doing business where the intangible asset of software is considered irrelevant will need to be challenged and then changed. 

Advani informs, “We organise free SAM seminars across the country generally targeted at SMBs as large enterprises tend to have better software licensing practices in place. We also work with the industry to promote SAM. For instance, earlier this year we carried out a joint program with Nasscom in which BSA paid for and assisted firms in their SAM efforts.”

He adds, “The feedback has been positive. We had more requests for assistance than we expected. Other member companies also have SAM programs and SAM kits. There are also free SAM tools on our Web site.”

He feels that SAM will increasingly become critical for Indian businesses as they do business globally. Companies will require SAM to meet global standards in terms of compliance and efficiency.

While large enterprises are further up on the adoption curve, SMBs are the key focus segment.  

Sivaprakash says, “Organisations spend millions of dollars annually on software license fees.” 

Keeping SAM in mind

Organisations spending huge amounts on software should develop and implement a proper software management policy. 

Companies need to communicate their software policies to employees. Software must be recognised as an asset and software lifecycle management should be included while making business plans. When purchasing hardware, efforts must be taken to ensure that the software pre-loaded on machines is fully authorised and licensed.

An organisation that achieves software copyright compliance should conduct regular audits and compare usage with licenses owned.