Software as a service (SaaS) has given businesses a number of advantages. However, organisations are now spending more on software licensing as a result. At the risk of stating the obvious - to minimise your licensing costs – you need to do two things:
- Identify the number of licences you need
- Buy what you need most cost-effectively.
Both Represent Real Challenges. Why So?
- Users often want access to functionality that they don’t really need, and then many don’t use it to its full potential. Microsoft Copilot is the latest example, with people jumping at the chance to buy a subscription but not using the platform as much as they could be.
- Vendors have a habit of making software licencing complicated, and once you’ve gotten the license, that complication doesn’t end. Vendors have a passion for two things:
- Creating new licencing models. Moving from an old licencing model to a new one can sometimes offer real advantages. The challenge is: how would you ever know? Your incumbent supplier may have no interest in making you aware of a new model that would help you pay less.
- Bundling. Vendors have a particular passion for bundling. They find ways to combine functionality that your people really need – with new functionality that they would like your team to explore – at an attractive price. Three years later, on renewal, you find that the functionality that was new/cheap is now much more expensive and something that staff insist they can’t work without - see a) above. Bundles are designed to stop you from making deliberate buying decisions.
How Can TSG Help
TSG takes a different view. We believe it is our job to help you get the best value from the money you spend on IT. To that end, all TSG Managed Service customers get a quarterly report explaining what software your users are actually using. We review your current licence and support estate, checking that your users, machines, and licences are all optimised for your estate. We recommend that this report be used to define the number of licences you procure. If you want us to procure those licences on your behalf – we’re happy to do so on an open- book basis – we’ll be transparent about our cost, price, and margin.
