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4 Signs Your Organization Should Invest in Software License Management

4 Signs Your Organization Should Invest in Software License Management

Software license management is  one one of the most important factors when it comes to dealing with your organization’s software assets. As a matter of fact, neglecting managing your software assets could cause serious legal issues, financial implications, and reputation damage to your organization.

If you’re involved in software asset management, you already understand how important it is to ensure that your organization has exactly what it needs to function efficiently. Ensuring that your IT organization is spending its money wisely and remaining in compliance with its legal agreements is crucial to your success.  Yet many companies do not give this issue the attention it deserves.  And for some this has resulted in hefty fines and even jail time!

Investing time and resources in software license management will not only keep you legal with your software vendors, it will also help you save money on licenses and maintenance costs.

So how do you know if you’re giving enough attention to your software licensing?  This post provides four signs that indicate that you need to invest in managing your software licenses.

Sign #1: You don’t know if you have more licenses than you need

If you don’t have an enterprise-wide license, then you are probably buying licenses individually.  This is fine if you are keeping track of these licenses and if you are diligent about reallocating licenses when an employee leaves your company.

However, if you don’t have a good handle on the amount of licenses your organizations actually needs and is using, it’s possible that your organization is over-spending on software licenses.  Or even worse, your company may be installing software that you are not licensed to use.

If this is the case, you should conduct your own audit of all of your software licenses. Find out how many you have and how many are being used. This will help you discover opportunities to lower your spending and avoid potential legal issues.

Sign #2: You don’t know the terms of your license agreements

Each software program your company uses includes legal agreements that your company agreed to when purchasing the license. These contracts outline how your company is able to use the licenses it purchases.

These agreements are very important because they let you know what you need to do in order to stay in compliance and avoid fines. If your company violates any of the policies laid out in these agreements, you could be putting your organization in danger.

Make sure you are fully aware of what your software vendors expect regarding usage of their products. It might be a good idea to have your attorney review the documentation with you in order to ensure that you fully understand the agreement.

Sign #3: You have no idea how often each license is used

It’s very important that you are consistently aware of how your company is using each license it purchases. Having licenses that aren’t actually being used means your company is spending money unnecessarily.

But what about licenses that are being used improperly? What about software that is being used in a way that isn’t necessary? If you have software licenses that could be used more effectively, then your organization could still be losing money.

In addition to doing an audit on the amount of licenses you have, you will also need to take a long, hard look at how the software is being used. If a given software license isn’t being used in a way that adds a distinct benefit to your organization, you may need to discard it, or find another use for it.

Sign #4: You have no software license management strategy

Do you have a comprehensive strategy and process for keeping your software licenses under control? If not, you could be leaving yourself open to unnecessary spending, audits, legal suits, and a damaged reputation.

You should have a plan that addresses each area of your license management program so that your team can stay on top of it. This will help you minimize the risk of being noncompliant with your software license agreement. It can also help you rein in spending so that your organization can run more efficiently.


Software license management is incredibly important when it comes to the success of your organization. If any of these four signs applies to you then perhaps it is time to focus time and resources on putting an effective software licensing strategy in place at your company.


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