Here’s a sample of key findings from this year’s report based on a survey of 500 IT executives from around the world. Scroll to find out more.
The technology landscape is changing, and digital transformation pressures are mounting. The highest-functioning enterprises are leaning on IT asset management practitioners who face new and evolving challenges. The Flexera State of ITAM Report provides insight into the makeup and focus of ITAM teams at enterprise-level organizations. The report offers commentary and advice on ITAM usage statistics and trends. These are indicated throughout as Flexera POV (point of view). The report takes a high-level view of IT investments across public cloud, hybrid cloud and SaaS technologies.
The survey tapped 500 global technology executives and leaders in the summer of 2022. They represent a broad cross-section of industries.
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This year’s survey is weighted more heavily toward larger companies, with 70% of respondents in organizations with more than 5,000 employees, up from 51% last year. Ten percent of respondents have fewer than 2,000 employees and 10% have more than 100,000 employees (a new category this year).
Much like last year, more than two-thirds of respondents were from the Americas, with the vast majority of those from the U.S. European respondents comprised 31% of the total respondent pool, with the UK contributing 14%.
The ITAM function continues to broaden in response to the growth of SaaS and cloud. Last year, 4% of respondents said cloud best described their function, and this year that number increased to 17%. And the increased focus on sustainability is placing more importance on ITAD (IT asset disposition)—safe, secure and environmentally responsible disposal of technological assets.
The ITAM teams reporting to the CIO or CTO went from 22% last year to 43% this year.
A cloud center of excellence (CCOE), a centralized way to manage an organization’s cloud journey, is increasingly becoming the norm (69% of respondents).
of CCOEs have an ITAM/SAM member on the team
The CCOE will have the most exposure and influence on an organization’s cloud journey.
Enterprises should include ITAM practitioners in CCOEs.
SAM teams are critical and interact with teams across an enterprise. This year, SAM teams interacted with a much broader set of enterprise teams than in years past. For example, interactions with CIO/CTO increased from 23% to 44%, cloud jumped from 26% to 42% and security from 35% to 50%.
ITAM teams reporting to the CIO/CTO have the highest level of significant interactions. We see an increase in ITAM teams’ interactions with cloud teams compared to last year (the highest last year was 38% interacting with the cloud team, and the lowest was 16%).
reported advanced SAM practices, including ongoing tracking, plus optimization of software licenses beyond just audits/tracking SaaS and cloud usage
As SaaS and cloud usage and costs eclipse on-premises software, ITAM professionals should continue to increase their involvement in these areas.
Tracking the use of software licenses on-premises is currently the most common activity for ITAM teams. In the future, ITAM teams plan to focus on identifying overlapping or redundant software (41%), finding ways to optimize the use of software licenses based on use rights (40%) and tracking the use of software licenses in containers (38%)—this responsibility saw a significant increase year over year, from 28% to 46%, as did tracking use of software licenses in the cloud, from 42% to 52%.
To keep up with their peers, ITAM and SAM professionals need to develop better processes to identify overlapping or redundant software, optimize software licenses based on use rights and track software licenses in containers.
SAM teams are maturing, and the gap between advanced and beginner SAM teams is closing. Last year, the difference in responsibility for responding to audits was 86% of advanced compared to 55% of beginners. This year, that gap is just 64% to 55%. Beginner organizations take on more responsibilities as SAM practices change and evolve to a more cloud-focused approach.
Hardware asset management (HAM) is less advanced than SAM. As previously discussed, 51% of SAM respondents are doing advanced activities, compared to just 36% of HAM respondents.
There is a need for ITAM teams to mature HAM processes to catch up with the more mature SAM processes.
HAM will continue to evolve as it manages and tracks on-premises hardware, including servers, storage systems and network gear, as well as remote access devices employees use to access cloud resources, such as laptops, phones and mifi devices.
Teams reporting directly to the C level have the broadest responsibilities. SAM teams have seen a significant increase in the tracking use of public cloud and SaaS. Teams reporting to security focus on security-related responsibilities such as audits, identifying at-risk software, and maintaining an accurate inventory of licenses.
Respondents estimated 38% of desktop software spend, 34% of data center software spend, 33% of SaaS spend and 33% of IaaS/ PaaS spend were wasted.
ITAM challenges hinder organizations from recovering wasted spend. Dealing with SaaS, cloud and containers is a significant challenge (32%), as is complexity of software vendor use rights (32%). The lack of resources on SAM teams is also a significant challenge (31%).
Audits are a challenge, no matter the SAM team’s maturity level. However, beginners struggle more with clear/comprehensive visibility into all software assets. Dealing with new environments (SaaS, cloud, containers) is the biggest challenge for advanced users, presumably because they’re doing the most in these areas.
Respondents still struggle to implement best practices for governing the use of SaaS and optimizing SaaS spending, with less than half tracking usage and rightsizing overall SaaS contracts (48%). Year over year, the most significant gains were rationalization of redundant SaaS apps (19% to 36%) and linking all major SaaS apps to single sign-on (SSO) (43% to 55%).
SAM professionals expect SaaS and cloud computing to drive the biggest change in focus over the next three years. Almost three-quarters (73%) expect increased focus on SaaS solutions, compared to 61% last year. The expected change of focus on public cloud increased to 68% from 58% last year. Data center software and desktop software are down at 17% and 13%, respectively.
Over the next 12 months, SAM teams indicate they intend to be more focused on cost-savings-related activities such as optimizing and finding savings in software spend (55%), improved management of SaaS products (44%) and improved reclamation of underused or unused software (43%).
Time spent supporting software publisher audits and regulatory audits is down slightly year over year (27% to 24%, and 26% to 22%, respectively). The time SAM teams spend responding to audits decreased slightly year over year. As a result, SAM practitioners are increasing the time spent on strategic non-audit activities (17% last year, 24% this year).
It’s good that SAM teams are spending more time on strategic non-audit activities. SAM practitioners should continue to increase their focus on areas such as cost management and SaaS management.
When asked to rate, on a scale from 1 to 5, how relevant technology providers are to a SAM program, SAM professionals continue to increase their focus on cloud year over year, with AWS having the most significant increase from 2.52 to 3.29. VMware decreased year over year from 3.29 to 3. Microsoft had the top three spots with Microsoft licensed software (3.78), Microsoft SaaS products (3.77) and Microsoft Azure public cloud (3.47).
Respondents reported an increase in the number of audits by Microsoft in the past three years (from 46% last year to 52% this year). During the same period, a significant number of respondents reported having been audited by IBM (34%), Oracle (31%) and SAP (28%).
Software audits continue to be very expensive. Last year, 9% of respondents said they paid more than $5 million in the past three years as a result of software vendor audits. This year that number grew to 14%. For the first time, this year’s survey broke respondents into three categories over $5 million: 7% who spent between $5 and $10 million, 4% who spent between $10 and $25 million, and 3% who spent more than $25 million.
14% of respondents reported paying more than $5 million in software vendor audits over the past 3 years
INCLUDING PENALTIES OR UNBUDGETED TRUE-UPS
Despite growing pressures to optimize costs, SAM teams are predominantly measured on audit-related, rather than cost-related, activities. Compliance with regulatory or internal audits (47%) is the most common way to measure the success of SAM initiatives; audit compliance is second highest at 45%. Hard savings on software is 40% and reducing or minimizing growth of renewals is 33%.
The top three measures of success for HAM teams are reduction in maintenance contract spend (39%), reduction in hardware purchases (38%), and reduction in manual effort via automation (37%). Overall, it appears HAM teams are impacted by the move to the cloud.
Green initiatives such as reduction of carbon footprint (25%) and amount of hardware recycled/donated (29%) were also prevalent this year. Flexera expects more HAM projects to focus on sustainability initiatives in the coming years, as many organizations now have ITAD (IT asset disposition) teams.
Top analyst firms suggest SaaS spending has surpassed on-premises spending. We see that as well, with the vast majority of respondents spending more than $100,000 per year on SaaS.
SAM programs were most successful in realizing savings through reuse of licenses to avoid buying new ones (non-cloud) (83%), better negotiation of vendor contracts (83%) and reduction of maintenance spend on unused software (81%). Audit-related initiatives were less successful at realizing actual savings.
of respondents use configuration management databases (CMDBs)
As organizations increase their use of transient assets such as cloud instances or containers, they must reassess their IT asset tracking procedures to ensure their CMDBs don’t become bloated with irrelevant entries.
This year, CMDBs tracked a broader set of assets. On-premises virtual machines (VMs) tracking in a CMDB decreased 12% year over year. All other assets rose between 13% and 18%. Each of the cloud-based assets (public, private, containers) made significant gains.
Respondents are most likely to export data from asset management tools into enterprise systems or CMDBs such as ServiceNow (52%), BMC (35%) and Cherwell (17%).
In this year’s survey, Europe has more beginners (31% compared to 17% in North America) but a similar number of advanced users (49% to 55%).
European ITAM teams are most likely to interact with IT service management (51%), infrastructure and operations (48%) and CIO/CTO (47%). Also, ITAM interaction with cloud teams increased significantly, from 24% last year to 42% this year.
Currently, tracking use of software and the associated licenses remains important (containers 51%, public cloud 47% and on-premises 60%), as does responding to audits (52%). This mirrors the global survey, so it appears the responsibilities are constant regardless of geography.
SAM teams are more strapped for resources in Europe than in North America. More than three quarters (78%) in Europe name lack of resources on SAM team as a challenge (37% significant, 41% somewhat). More than four-fifths (88%) cite amount of time/money spent responding to audits as a challenge (27% significant, 61% somewhat).
In Europe, cost-saving initiatives are top priorities for the next 12 months. The top initiatives are improved reclamation of underused or unused software (51%) and optimizing and finding savings in software spend (47%). Audit-related activities are lower, including tracking use of software licenses (31% in containers, 32% in public cloud).
Microsoft remains the leading auditor of software usage, as 49% of European respondents said the company audited them in the past three years. A higher percentage of European respondents say they have been audited by IBM (34% globally, 44% in Europe).
As in the global survey, there’s a misalignment between SAM metrics and SAM initiatives themselves. SAM teams are predominantly measured on audit-related activities—compliance with regulatory or internal audits (44%) and accuracy of license position (43%).
Similar to the global survey, the top three areas where savings were realized are not audit-related. This contrasts with the SAM program metrics, which prioritize audit-related activities.
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