Gartner estimates 30 percent of cloud fees paid by enterprises are for licenses that are dormant, or license features that are not being used. This “toxic spend” plagues enterprise IT budgets – and vendors don’t make it easy to keep license allocation optimized.
One way to eliminate SaaS toxic spend is to periodically perform a formal license optimization assessment of your large SaaS implementations – it almost always reveals material, easy cost reduction opportunities.
NPI performs turnkey SaaS License Optimization Assessments for the following SaaS estates:
NPI Identifies Specific, User-Level Savings Opportunities
NPI’s SaaS License Optimization Assessment is a proven, painless and fast way to cut SaaS costs. Using standard inputs from your existing applications and tools, NPI performs a detailed analysis to identify specific, actionable cost reduction opportunities in two categories:
Right-size License Assignments: NPI optimizes cost by matching the best license type to each user based on task/role/utilization. We perform deep-dive analysis into actual usage to quantify the financial benefit of rightsizing the license type for each user. The guidance NPI provides enables you to rapidly switch individual users to more cost-effective licenses.
Liberate License Currency: NPI helps you liberate inactive licenses for redeployment (vs. additional license purchase to fulfill new license distribution) and to reduce demand at true-up or renewal time. We apply multiple filters to actual usage data to identify licenses that can be reclaimed including inactive users, multiple licenses assigned to a single user, ex-employee and ex-contractor users, “no-pulse” users (e.g. printers, conference rooms), and more.
Upon completion of the analysis, NPI delivers a report that specifies user-level license reclamation and right-sizing recommendations that can be quickly and easily implemented.
NPI recommends that SaaS License Optimization Assessments occur at least once a year for large enterprises that have a lot of human capital change. And they are particularly important as SaaS renewals approach – establishing an accurate, optimized usage baseline as input to demand definition for the renewal agreement
is critical for cost control.
Actual Client Results
NPI’s SaaS License Optimization Assessment identifies $4M in Microsoft M365 cost reduction for Fortune 500 CPG company
Why is SaaS Spend So Hard to Manage?
It’s so easy to assign SaaS licenses to users, but maintaining good license hygiene is notoriously difficult – even for enterprises with sophisticated SAM capabilities. SaaS vendors are adept at bypassing IT and Sourcing and engaging business users directly, and enterprise SaaS license management is typically distributed across multiple admins in multiple business units and/or departments. While SAM and other tools aspire to manage SaaS licenses, few organizations have implemented the tools and surrounding processes deeply enough to realize this vision – and tools cost money (license fees, implementation fees, personnel to manage and monitor).
SaaS presents a unique governance challenge for IT and Sourcing. License “bloat” occurs over time making it more and more difficult to find and fix. Distributed buying often gives away the leverage of consolidated spend management. Departmental control results in inconsistent license management. These issues are compounded during renewals which are often based on unvalidated usage and inaccurate baselines that get assumptively locked in over time.
NPI’s SaaS License Optimization Assessment neutralizes these challenges by giving you visibility into whether each SaaS license is actually being used (or underutilized) and where you can (i) reclaim licenses and (ii) make changes to license type selection to reduce costs. An additional byproduct of NPI’s assessment is material cost-avoidance through the establishment of an accurate baseline for renewals and true-ups
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Interested in a turnkey optimization assessment of your Microsoft, Adobe, Salesforce or ServiceNow SaaS estate? Let’s talk.