According to Gartner, enterprise software spending is forecast to reach $754.8 billion in 2023. With this aggressive rate of software adoption, it’s no surprise that Gartner reports a rising interest in software asset management tools to govern software usage within their organization.
Gartner recently published its 2022 Market Guide for Software Asset Management Tools, and recognized Zylo as one of the vendors helping organizations to decipher and navigate the complexities of managing software licenses and SaaS subscriptions. We are honored by this recognition, especially since it reinforces the importance of traditional SAM and ITAM teams evolving their scope to manage the complexities of SaaS subscriptions.
The report not only contains great insight into the future of the software asset management space and the tooling that will be required as software continues to evolve. Here are my key takeaways from the report.
Takeaway #1 – Defining SAM Tool Requirements is More Nuanced Than Ever
Outlining software asset management tool requirements is becoming exponentially more difficult. It used to be that evaluating SAM tools looked very similar from company-to-company and tool-to-tool.
Simply put, a 50,000 employee company that’s been in business for 100 years would have nearly identical requirements and desired business outcomes as a 10 year-old company with 1,000 employees.
But as cloud adoption continues to explode and more SaaS gets introduced into software environments, the wants, needs and desired business outcomes vary drastically from company to company.
To complicate matters even more is the unpredictability of software publishers. Publishers changing course with how their product is measured is not new to the industry. As soon as you feel comfortable understanding how to apply certain product usage rights; the publisher changes the unit of measurement, bundles, editions, etc.
It’s worth noting that publishers seek predictable annual recurring revenue, with the opportunity to increase revenue as their software is utilized more. Because of this, you can expect to see an increase in the types of licenses and bundles made available.
With each of these publishers and products, management becomes more challenging given the types of licenses you’re required to manage. This puts added pressure on SAM tools.
Takeaway #2 – Success Criteria for SAM Tools Has Not Changed, Data Integrity
According to the report, a jaw-dropping 36% of stakeholders in Sourcing, Procurement and Vendor Management question the success of their SAM tool.
Having been directly involved: evaluating, testing, implementing, running and maintaining SAM tools, this is often due to spending time evaluating ‘what’s possible’ and not what’s required.
To put it another way, if you cannot measure the completeness and accuracy of data in your software asset management tool, you are likely in the 36%.
When you couple weak capabilities of SAM tools with under-resourced SAM teams, you end up with low-quality reports and exhaustive discourse around corner-cases.
When reports cannot be used to make effective investment decisions, you increase the likelihood of pushing key stakeholders away. And sometimes you never get those stakeholders back.
To get to a position of data integrity requires strategic and consistent time investment. All told, the effectiveness of your SAM tools will only be as good as the data in them.
Takeaway #3 – Best of Breed is the Path Forward
Last year, Gartner predicted that by 2026, only 20% of organizations will use a single tool to support their SAM practice. And this sentiment is still present in this year’s report. Traditional SAM tools can only go so far in providing trustworthy, actionable data – which is why specialized solutions for managing the complex world of SaaS have emerged.
Many organizations have seen their software portfolios double in size over the past five years. Compounding matters even more are the sheer number of applications available in the market today.
Maximum return on investment with SAM tools requires investment in multiple solutions. What tools cannot address must be supplemented with well-resourced and knowledgeable Software Asset Management teams.
Stretching traditional SAM tools to accommodate SaaS typically results in an abundance of corner-cases. Spending time fine-tuning corner-cases is a sure fire way to limit success.
Organizations must look beyond single solutions and identify best-in-class tooling that is aligned with pragmatic use cases, repeatable processes and available resources.
To learn how Zylo can help you understand and navigate the complexities of managing software licenses and SaaS subscriptions, request a demo with one of our SaaS Management experts.