How to Build a Business Case to Justify Implementing and Operating a SAM Program

Software asset management (SAM) is sometimes viewed as a job function that simply pays the bill for software expenses within the enterprise. Then, businesses scramble to respond to an audit when vendors say you need to pay more for a SAM program. While most SAM practitioners believe it’s a business-critical function, unfortunately, many CEO, CTO, or CFO types don’t and view it as an operating expense. So how do you build that infamous ‘Business Case’ that’s always forthcoming?

To answer that question, you need to know your current cost for providing SAM and whether your executives view SAM as a cost center or a strategic investment. If it’s the former that’s unfortunate; you’ll need to understand expectations regarding cost reduction and cost avoidance. If it’s the latter, that’s a good thing and you can make a more strategic decision.

In addition to knowing your Total Cost of Ownership for providing SAM services within your company, you need to understand how ROI is calculated. ROI is a revenue increase due to an investment or a decrease in cost. Typically, these savings are realized by reducing the redundancy of hardware, software, and labor cost attributable to the specialized expertise of your team. An Optimized SAM team can account for anywhere from 20-80% cost savings, which can translate into millions of dollars that a company is currently wasting.

So, what are the key elements of the business case that will make it compelling enough to obtain support from your Executives?

1. What problem are you solving and how?
2. What is the impact on the business?
3. How much does this cost, and what’s the benefit?
4. Can this be done another way or without the investment? If so, how?
5. What is the cost of doing nothing?
6. How are you going to do it and when?
7. What is the timeframe and when do we see a return on investment?

A key area to focus upon for immediate impact is understanding your software spend (licensing-maintenance) and whether you are paying for unused licenses which are wasted spend. A thorough understanding of your enterprise agreements and knowing whether you are over or underpaying across the company will be key inputs to your business case.

Calculating ROI is not an exact science. There are typically higher costs at the outset due to the investments mentioned above and the time it takes for those efficiencies to come to fruition. It’s important to note that a tangible ROI requires investment in software, hardware, consulting, and education to truly be successful. That’s why engaging a firm like ISAM makes that job much easier for you!  

Nothing will get your financial folk’s attention like saving them between 20-80% on software spend and avoiding future risk!

David Gemuenden is a Technology Executive who has held pivotal senior leadership roles at IBM, Dell, Flexera, Snow, and Livingstone Group, helping those companies transform their business, and has now joined ISAM Group.

His diverse background in product management, software development, service delivery, ITAM, SAM, and customer success provides him with a unique ability to bridge customer requirements with business realities, resulting in peak organizational efficiency and increased customer satisfaction.