How Software Asset Management Can Help Your Company’s Bottom Line

Software Asset Management (SAM) is the management of IT practices with the intention of streamlining workflows, managing licenses, stabilizing IT budgets, and increasing visibility across the IT environment. It involves managing and optimizing the acquisition, deployment, maintenance, utilization, and disposal of software assets across their lifecycle within an organization. Ultimately, the optimal management of software assets cuts costs, offering significant benefits to bottom lines. 

The Software Asset Management Process

Software Asset Management is an ongoing process that requires continual maintenance and, whilst it may seem to be a simple task, companies use more and more software every year. The average department uses between 60 and 80 SaaS apps alone, excluding their on-prem applications. Managing all this software is a critical aspect of IT management as it helps organizations ensure compliance with software license metrics, reduce software costs, and improve overall efficiency. With software expenditure making up approximately 21% of a company’s total budget, proper management of an IT environment has a direct impact on the profit margins of your company. Software costs are also anticipated to grow by 10% year-over-year until 2027, meaning that ongoing cost optimization will remain a significant priority. 

“Software Asset Management (SAM) is all of the infrastructure and processes necessary for the effective management, control, and protection of the software assets within an organization throughout all stages of their lifecycle.”

– ITAM Review

Avoid the Cost of Software License Audits 

A key aspect of SAM is ensuring compliance with numerous software license agreements. This involves tracking the number of licenses an organization has purchased and ensuring that they are being used within the terms of the agreement. These contractual obligations can be surveyed by the vendor at any time during random software license audits and, without a real-time understanding of a company’s IT environment, there’s a big risk of being under or over-licensed. Non-compliance can result in significant financial penalties, while over-licensing to avoid penalties also generates overspend. A robust SAM platform is the most reliable way to ensure license compliance, making audits smoother and limiting spend on fines.

Save on Unused Software Applications 

Another key aspect of SAM is identifying and managing underutilized software assets. This involves identifying software that is installed on computers but not being used, and SaaS subscriptions that are not being used. The average enterprise company wasted $18 million on unused SaaS applications in 2024, highlighting just how significant the overspend can be. Once this position is evaluated, companies can either reassign or remove licenses and reduce costs significantly. Xensam’s unique Active Usage Tracking gives companies insight in their software usage down to the minute, allowing them to better optimize the licensing of their software assets. By ensuring that software licenses are optimally assigned to the right users, organizations can cut spend significantly. Some Xensam customers have saved up to 30% on major vendors, and many make big savings within the first 12 months of deployment. 

“Within the first 12 months of deploying Xensam, we’ve been able to save approximately £250,000 cutting underutilized licenses by tracking both total usage and actual usage of applications.”

– Digital Infrastructure Programme Manager, Isle of Wight NHS Trust Case Study

Stop Overspending on Shadow IT

Finally, correct Software Asset Management can prevent overspend on shadow IT. Shadow IT consists of applications that were bought, deployed, or used within a company’s environment without the consent or prior knowledge of the IT department. It’s estimated that up to 40% of IT spend can be attributed to shadow IT. Without the the right tools, these apps will slip through the cracks and continue to generate unmanaged cost. With Xensam’s advanced technology, IT departments can gain total visibility of known and previously unseen software. Shadow IT can be easily identified, and the IT department gains control over all purchased assets. With the right tools at hand, and with internal procedures and policies that protect against the procurement of unapproved apps, wasted spend can be eliminated.

“With Xensam, we find vulnerable installations and what device or folder they’ve been hiding in. We’re picking up things that haven’t been detected before.”

– Senior Technical Specialist, Isle of Wight NHS Trust Case Study

Xensam’s Advanced Capabilities for Cost Optimization 

Implementing the right SAM technology within your IT environment can have a significant impact on the level of savings achievable for your company’s bottom line. By gaining comprehensive visibility and managing software assets effectively, organizations can avoid overspending on unnecessary software licenses and reduce the financial risk of license non-compliance in audits.

Xensam makes tangible cost savings a reality with advanced technology, reducing the negative impact that complex IT environments can have on bottom lines. Comprehensive visibility of all apps mitigates the risk of shadow IT overspend. The licensing overview provides detailed insight into over or under-licensed software. Active Usage Tracking provides granular data on consumption, and the Cost Center provides a unified picture of cost data across the IT environment. These capabilities and our other advanced features work together in synergy to help companies manage spend, cut unnecessary costs, and optimize bottom lines with the power of Software Asset Management. 

Conclusion

Software Asset Management (SAM) is a critical aspect of IT management and has a significant impact on a company’s bottom lines. Implementing advanced SAM technology allows companies to control waste on shadow IT, avoid overspending on unused software licenses, and reduce the risk of non-compliance with software vendor agreements. Xensam’s AI-powered technology offers advanced cost management capabilities, allowing companies to achieve real, tangible savings.