Why the Cloud Makes Software Asset Management Much Harder

The beauty of the Cloud lies in its simplicity. Deploying a new service takes just a few mouse clicks, a hosted application subscription can be purchased on a credit card. Always on, instantly available, the Cloud seems to be the answer to many common IT problems.

A study by software firm Dynatrace found that 79% of businesses are concerned that there may be hidden costs associated with Cloud services. Most assume that these costs will be in the form of additional charges for unexpected resource usage, but they are more likely to come from increased administrative overheads – particularly for the Software Asset Manager.

Who is in control of software purchasing?

The ease with which Cloud applications can be purchased means that many business units are bypassing the IT department altogether. Often this means that the SAM has no record of the application or the associated license count, making it almost impossible to maintain accurate records.

Trying to reclaim control of the software purchasing process becomes a political battle. The ability to circumvent purchasing bureaucracy offers business unit leaders an opportunity to deploy applications quickly and efficiently, maximizing productivity and reducing lead times. For the CTO, the bureaucracy is a necessary evil, if only to give them time to prepare the resources necessary to properly support each application.

The traditional software purchasing process gives the software asset manager a chance to check the details of the order, ensuring that they can capture the details of license coverage – and to identify any potential shortfalls in advance.

The Cloud adoption process needs to be managed in some way to prevent problems during an audit. The risk is real – a report by CipherCloud discovered that the average global enterprise has 1100 Cloud apps in use. However, 86% of these apps have never been approved, creating a “shadow IT” infrastructure that exists outside in-house IT support provisions.

A hugely complex infrastructure

Businesses have spent several years, and many millions of dollars trying to consolidate IT systems to simplify data access and sharing. The irony of Cloud services is that they tend to fragment IT processes, creating new silos and reversing much of the hard work put into integration.

For the SAM the problem is even bigger. With so many different products, services and platforms in play, staying on top of them all is virtually impossible – especially if they are only aware of a fraction of the apps and platforms in use.

Hosted infrastructure creates the same problem

Platforms like Amazon Web Services, Microsoft Azure or even IBM Cloud create similar problems. With the ability to install applications and servers into Cloud data centers, your business can reduce its own capital spend on hardware – a massive benefit to the company’s bottom line.

But by moving systems off site it becomes much harder to inventory licenses and maintain compliance. This is especially true of development-type deployments, where the IT departments tests new applications and services. Indeed, Cloud environments are now an established part of the rapid application development process. Unfortunately the focus on speed often means that factors like licensing provisions are overlooked in favor of speed – an excuse that auditors will never accept if they do discover a shortfall.

Time to get help

The only way for the SAM to reclaim control of Cloud apps and subscriptions is to run a full-scale discovery exercise – probably in conjunction with the finance department who will be able to trace purchases and subscriptions made without IT assistance. Alternatively, a third party like Origina can help carry out the necessary discovery process, tallying and verifying IBM installs and license count.

The spread of shadow IT using Cloud IT has created a major headache for SAMs – and most will need specialist help to bring their systems back under control.

For more advice about IBM® licensing in the Cloud, please get in touch.