Beyond compliance: A holistic SAM approach for procurement and sourcing

As companies undergo digital transformation, they are moving away from traditional enterprise software sourcing and fulfillment processes to achieve better speed, automation, transparency, and simplicity.

Successful Software Asset Management (SAM) is critical to ensuring compliance and optimizing investments. However, the challenge of managing software in the ever-evolving digital environment means that to achieve enhanced agility and cost-effectiveness, your SAM strategy needs to evolve too.

Read on as we explore why SAM needs to evolve to become part of a greater Digital Supply Chain (DSC) strategy, how this can strengthen your SAM processes, and how each team in your organization can benefit from a holistic approach to procurement and sourcing.

Software digital supply chain: A part of your greater SAM strategy

A thorough SAM strategy is vital for business continuity. The problem is that there are many fundamental challenges to good SAM, and many strategies only focus on a limited part of the software lifecycle.

In many organizations, a SAM program will primarily focus on balancing the number of software licenses with the number used by the organization or ensuring that the software is in compliance with the specific vendor license agreement. However, this is usually done on an ad hoc basis or in response to an external demand like an audit or software renewal.

Instead, a good SAM strategy should be expanded to a full-fledged Digital Supply Chain (DSC) that leverages digitization and data transparency to optimize operations across the entire software lifecycle.

A standardized DSC digitizes, enriches, and maintains data records in defined systems. This actionable data can then be leveraged for SAM, procurement, cost reduction, workload prioritization, and beyond.

This takes SAM beyond compliance, leading to greater efficiencies across the organization in terms of spend and data transparency while ensuring that legal and compliance teams have the confidence that the new technologies entering their environment have been sufficiently reviewed.

Strengthen your SAM processes through DSC management

With software and cloud provision, sourcing, and management, there are many inherent challenges, including:

• Substandard User Experience - A lack of effective tools and systems to request software leads to a poor user experience organization-wide.
• Disconnected Departments - The procurement process is often poorly aligned with core business needs, resulting in delays and unnecessary costs.
• Poor oversight and Data Management - Non-strategic data management causes missed insights and prevents potential improvements from being implemented.
• Risk Exposure. Poorly evaluated software and user terms result in increased legal and security risks.

In contrast, DSC management provides a seamless, integrated set of systems and activities from the request to purchase through ongoing management and the entire software lifecycle.

The goal is to enable accelerated, correct, and proactive decision-making in the acquisition and maintenance of software. This leads to a better user experience across the entire organization,improving the optimization and transparency of software and cloud spend, and providing IT and procurement teams with the tools they need to do their work efficiently.

Implementing DSC management can strengthen your SAM processes and improve:

• Efficiency - Less effort is required to manage budgets, software applications, and negotiations.
• Compliance - Software and use rights are thoroughly evaluated and transparent.
• Cost Savings - Avoid costs with optimized license allocations, software consolidations, and improved negotiations.
• Work Prioritization - Prioritize specific workloads by selecting the software they need for productivity in their roles in a transparent, clear-cut way.
• SAM Maturity - Improve SAM processes with effective evaluation and monitoring, reducing risks and optimizing software spend.

Taking a holistic approach to SAM & Lifecycle management

Taking an organization-wide approach to your DSC has benefits for stakeholder KPIs from the CIO and CFO all the way down to end-users. In the context of the software lifecycle, organizations can use DSC management to transform the complexity of SAM and cloud management directly into business value.

Here’s how your team members can take advantage of effective DSC management:

• Procurement Teams - Optimize purchase decisions and accurately assess the risk of expenditure. This means that procurement is done safely, through the right approvals and checks. It also assists procurement teams with negotiating and choosing the right sourcing mechanisms to ensure they’re purchasing in the most economical way possible.
• IT Asset Management - By standardizing software sourcing and usage, reduce “Shadow IT” and the overall complexity in your organization’s software catalog by consolidating where possible.
• Vendor Contract Management - Integrated DSC management allows for a thorough overview of previous software spend and future renewal pipelines allowing for complete visibility and reducing unnecessary expenditure.
• End-User and the Business at Large - With one channel/entry point for all software requests, increase the speed that users can access software and the agility of your organization at large.
• CFO - Maintain a global perspective on IT assets to manage budgets and forecasting efficiently.
• CIO and IT Teams - With a centralized DSC system, easily enable effective software lifecycle management to support budget and project planning and increase spend optimization.
• Compliance Officer - Ensure that each contract has been assessed for risk, minimize data and security threats, and maintain agreements in a centralized database. From a contract and data protection risk standpoint, this means mitigating risks and automating workflow oversight.