The Benefits of Software Asset Management - Risk Management
The implementation of an effective software asset management process mitigates and facilitates the management of the following business risks.
Legal & Financial Exposure
Failure to purchase the correct number of software licences or breaching usage rights may force your organisation into a position of non compliance. This exposure may go unnoticed until a software vendor or enforcements agency initiates an audit. Typically an audit commences when the software vendor or enforcement agency is tipped off by a disgruntled employee, supplier or where the software manufacturer notices unusual purchasing patterns.
Damaged Reputation
If public legal action is taken against an Enterprise for running illegal licences, this will have a negative impact on their reputation. If legal action does not take place internally employees tasked with licence management face having a damaged reputation because of the impact associated with running unlicensed software.
Impact On Company Finances
An enforced audit by a third party can have a negative impact on cash flow and budgets of an organisation where large unexpected costs are incurred as a consequence of running unlicensed software. If Enterprises are non compliant the software manufacture may use penalty pricing and the company may face additional fines if legal action is taken.
Operational Impact
The absence of an effective software asset management process can impact on the continuity of the operational effectiveness of an Enterprise, examples of this include where:
- Legally a software manufacturer requests that you uninstall business critical unlicensed software.
- Critical applications reliant upon unlicensed software that is no longer available for re-purchase, can create risk when it needs to be reinstalled / reactivated.
- Security may be breached as result of running corrupt counterfeit software or as a consequence of running unsupported software that can no longer be patched.
An externally led audit will typically require the reallocation of employees to support the third party audit process. This can negatively impact on the day to day management and operations of an organisation as valuable resources are realigned.
Financial & Business Risk as a consequence of mergers/ acquisitions & demergers
Failure to complete due diligence relating to the software licence position of an Enterprise when completing a merger, demerger or acquisition, could result in unexpected financial cost and operational risk at a later date.