New to technology asset management? Want to succeed? Here are some things to consider.

Technology asset management - software asset management - It's all about putting a stop to status quo - putting a stop to "This is the way it's done...". If you are a "go along with the program" kind of person, you may get the job but you probably won't get the results. If, on the other hand, you are a "cut the the core" kind of individual, you probably have the capabilities to get the results but you probably won't get the chance to do the job.

Interesting quandary? Been there. Done that.

So here's my challenge to you: If you are willing to step up to the plate and change the asset management world, I'll help you all I can. How will you know if joining forces with "The Network!" and "The Institute!" would be right for you? Measure against your honest responses to the following items - don't present your corporate face - present your OWN. Answer as a buyer and use the word "Agree" for "I accept" or use the word "Disagree" for "I'll be taking this acquisition to your competitor" (I'll interpret your score when you have finished...)

1. This software contract is not negotiable...

2. The hardware agreement is not negotiable...

3. The provider reserves the right to change the agreement at will and without notice...

4. This product is sold "as is"...

5. You can only purchase a new computer with this specific operating system...

6. Our product is the only one of its kind...

7. Our services are supplier-neutral...

8. Subscription-based licensing is less costly than perpetual licensing...

Remember, "Agree" if you would accept or believe the clause or statement, "Disagree" if you would not accept or believe. Once you are finished, I'll explain how we can help you create a more cost-effective technology environment.

Here's the bottom line:

If you answered "Agree" to ANY of these items, you are an easy target for over-priced & under-delivered technology goods and services. You are a victim of the "this is the way it's done" mindset. You'll pay whatever the supplier asks and accept whatever product they plop down on your desktop. (Scary, isn't it?)

If you answered "Disagree" on these items, there is hope for you... You are on the road to getting actual value for your tech dollars. Consider:

1. This software contract is not negotiable...

   1. Bull. While the suppliers want you to THINK this, it isn't true. If it is, you need to find new suppliers.

2. The hardware agreement is not negotiable...

   1. Wanna bet? Re-read the item above.

3. We reserve the right to change the agreement at will and without notice...

   1. No... You do not and you WILL not.

4. This product is sold "as is"...

   1. Wrong. I purchased this product to perform specific tasks. If you cannot back the product - in writing - to do those tasks, don't come here trying to sell it.

5. You can only purchase a new computer with this specific operating system...

   1. No. That's you're agreement with the software publisher. You make money on every one of THEIR operating systems you force consumers to accept. There are alternatives. I want to know what they are & I do NOT expect to pay more to select an alternative.

6. Our product is the only one of its kind...

   1. Not in THIS century. There are plenty of alternatives that fit my needs & I'm perfectly willing to move to one of your competitors.

7. Our services are supplier-neutral...

   1. If a supplier taking money from a specific systems or software company, or if the supplier is investing money in becoming "certified" through a specific company then I'd be pretty ignorant to believe you weren't going to recommend (push?) that company's goods or services.

8. Subscription-based licensing is less costly than perpetual licensing...

   1. Let's see... A perpetual license means I pay one fee and use the product until "I" chose to change or I move to a subscription agreement, paying you a repetitive yearly fee to use whatever product "YOU" are pushing at the time. If version 1 works for me, I shouldn't have to move up to versions 2, 3, 4, and 5 just because you quit supporting them. (I rarely used your support anyway.)

These are VERY simple responses to these very common statements and/or licensing clauses. (Don't believe me? Take time out to read three licenses for products on your computers. Many of these clauses are going to be right there in your hand & you're already legally bound to them.)

Businesses are constantly spending too much for too little in terms of software assets, hardware assets & support / maintenance agreements. Not only do we spend too much, we have also been carefully trained to accept whatever products or services are slapped with a "cutting edge" label. If you want to get serious value for your technology dollar, you need to be part of The Network and The Institute.

Our core purpose is to teach you - YOU - how to change your relationships with technology suppliers. If you do not get proactive on this you'll continue to be a helpless victim of tech sharp practices in licensing & related agreements. Get what you expect & only pay for what's delivered.

Reducing Costs With Software As a Service? (SaaS) Just Like Your Cell Phone Bills!

I know that I've referred to Software as a Service (SaaS) as the prelude to a wide variety of onerous licensing tactics--and substantial hikes in technology spending. The most serious problem - and one we should ALL fear - is that a great deal of money is being spent to convince us that SaaS will reduce IT costs.

Answer me this: Since when does ANY software industry player want us to reduce spending on their products? Remember how well Software Advantage worked out (For Microsoft--not for the consumer)?

If you think software costs are out of line with value, here's another concept to consider:

• You're aware of how you get to pay for every minute; every message; and, seemingly, every breath you take on your cell phone, right?
• You know how the cell companies do business, right? How about AT&T long distance?
  
• Now, picture the same model in terms of software...

1. First they arrange to completely OWN the access - you just pay to use it;
2. They initially charge a flat rate per user - Not much, but then again, we want EVERYONE completely addicted as quickly as possible;
3. After you are hooked, and the costs to back out are prohibitive, they begin "adjusting" the rates to include per minute charges; per user charges; bandwidth surcharges; named user accounts; and so on...
   
4. Then they move to additional service fees (as in the banking industry); access fees; data recovery fees; data storage fees; billing fees; license surcharges; Billy's vacation fees; and so on...
   

Eventually, your software bill will read like a cell phone bill on a bus load of invoicing steroids - along with a "screw with us and we cancel your access" attitude. How quickly would your business drown without access to your computer systems? THAT is the question you need to ask - and develop honest answers for - prior to falling into the SaaS quagmire.

Oh...wait! Mr. (or) Ms. Software Billionaire says, "WE would never do that to our customer base." Right...

Business Technologies: You are Paying WAY Too Much!

Chad Walter recently asked a very good question that taps into the knowledge core of technology asset management. (It's here: Blogger)

"Does your business drive technology or does technology drive your business."

Great question, and it hides an enormous amount of detail that could easily translate into a unique value transformation of your enterprise technology environment. Here are my comments about how your company winds up spending the bucks on WAY more technology than you need.

The really serious key in this comment is that, with very low-tech, and highly cost-effective, technology asset management processes and procedures, you could reverse the costly trend of reactive buying and put business needs up front where they belong.

After nearly ten years of teaching technology asset management, tech portfolio management, negotiations, project management, and related programs to business professionals from around the globe, I would suggest that - for the average enterprise - technology is not merely driving the business but is also driving their "potential."

Want to reduce your company tech spending and build business value through tech?

Stop buying what you WANT and start buying what you NEED!

Altogether too frequently, an enterprise will contact me with operational problems brought about, not by IT as such, but by a slavish focus on "techno-best" at all costs. As a result, we see too many companies with very costly IT environments that have significantly outpaced user needs or abilities in their capacity.

It's called feature bloat and it means you are NOT in control--the supplier is.

When the users do not use - need - or want - a given level of functionality, then the enterprise has invested money in the wrong technology for its business model. Instead, you are conforming to the business needs of a supplier that convinced someone within your purchase/acquisition process that they MUST HAVE the new product or service.

As a direct result you will find yourself...

• Over-spending by a factor of as much as double,

• Under-utilization by factors of 10X and more,

• Constantly in reactive acquisition mode, rather than strategic acquisition mode,

• Paying enormous sums for unnecessary complexity that pushes the limits of your tech support, hardware, and systems compatibility,

• Modifying hardware as well as software simply because supplier "X" changed their product to "latest toy" stature,

Sometimes these problems are caused by C-suite personnel who "must have" the latest and greatest at all costs. Frequently, I meet with tech personnel who show me piles of new technology that far exceed the user abilities of the personnel. Sometimes these products were purchased for no more valid reason than "..an executive on the airline was using one and we should have it, too."

Or, the problem can be caused by techies who are under the same impression. Don't forget that techies, God love their strangely assembled brains, have invested a great deal of their time and personal efforts in learning a specific range of technologies. When the provider of that particular technology changes to a new product, sometimes the techs have no choice but to upgrade--or they could lose their certifications.

Now... There's a couple great justifications for business technology acquisitions.

The most common source of problems is a combination of many diverse factors and, in every client environment, we spend focused time sorting these out to find the root causes. But, there is another issue we should consider: As long as the enterprise is channeled into internal technology life cycle management decisions based on external pressures by suppliers, there will be - can be - no resolution to unnecessary IT spending.

In other words: Just because the supplier upgrades doesn't mean your business will benefit from the changes.

Pack all this together and couple it with the fact that the majority of companies simply does not have their own long-term & enterprise-loyal technical team. When all of these issues align the chances are pretty solid that you'll wind up with technology driving the enterprise potential for operational excellence instead of business strategies driving the tech environment.

Somehow, tech BECOMES the business because the business is too focused on keeping up with tech.

Here's How You Can Cut Costs on Software or on Hardware Support / Maintenance

Why are auto-renewal licenses and support / maintenance agreements an incredibly costly problem?

A majority of very typical enterprises:

• Have no trained individual responsible for closely monitoring auto-renewal agreements.
  
• Simply have no idea which auto-renewal licenses and agreements they have present in their technology environments.
  
• Do not know when the auto-renewal takes place.
• Do not know the process for canceling the auto-renewal.
• Have no process for determining if they should cancel the agreement.
• Try to purchase and implement costly and overly complex supplier-specific solutions or try to implement just-as-costly generic global standards.
  
• Have no executive support within the enterprise to extend the responsibility and authority to take action to reduce costs in a strategic manner.
• Honestly believe that they can purchase a silver-bullet solution that will resolve all their problems in one fell swoop.
  

Real World - Most auto-renewal agreements are crafted in such a manner that, if you do not cancel precisely in accordance with the terms and conditions, you will still have to pay for another year. (Yes, even if you tried to cancel.)

How do you prevent your company from being hammered by auto-renewal software or hardware support and maintenance agreement sharp practices?

• If this initiative isn't important to executive management, it isn't going to happen. If you are an owner / board member / executive manager, it is absolutely vital for you to get behind this individual asset management process. The savings can be enormous--with little or no negative impact on operations.
• Ensure that one of your people becomes trained in the methods and processes for closely monitoring the terms and conditions of licenses and agreements. No, you do not necessarily need a lawyer for this--an advanced clerical worker or paralegal could manage these on a day to day basis. (We do not teach law or profess to provide legal advice. We do, however, provide basic common sense methods for understanding the day to day requirements of technology agreements.)
• Ensure that your designated asset manager has the infrastructure present to gain access to the operational information required to effectively manage these materials.
• Ensure that all auto-renewal dates are clearly documented as well as the lead time for notification.
• Ensure that a VERY clear documentation process is in place to identify the precise dates and processes required to cancel an auto-renewal.
• Ensure that the asset manager has a credible and measurable process for evaluating the need to continue or cancel a given agreement.
• Ensure that you complete the simple, cost effective, and common sense ground work prior to considering new software, standards, or teams of consultant experts.
• Oh... And there IS no silver bullet solution. You're just gonna have to apply brain power.
  

There's more but you should get the idea. Remember, you have a choice in implementing technology asset management initiatives.

• You can choose to use the expensive-to-purchase and expensive-to-implement supplier-hype solutions involving costly international standards.

OR

• You can use a plain old normal, common sense, and a cost effective phased approach that makes sense for your unique environment. Once this ground work is in place, you can move on to more complex options.
  

I suggest you use option #2.

European Union Considering Software Value Legislation

This is a great follow-up to my last post. It seems that the European Union is considering legislation to require software publishers to be responsible for their code. OMG!! What a unique concept!

Anyone care to guess which international software houses are becoming very upset? It'll be interesting to see the way these folks spin their righteous indignation to this--obviously unfair--proposed legislation.

Let me think. How much do you suppose your company has spent over the years in cleaning up sloppy code on the part of software publishers? What was your ROI on all that effort? How much of the real work of your enterprise was set aside during those reactive emergency fix-fests? At what point in the history of product value did we all decide that software and operating systems do not have to deliver quality workmanship (or work-womanship)?

I'm sure we all agree that our well-funded legislators in D.C. will never produce such a consumer-friendly act--the technology product lobbyists who apparently make national policy would never permit it. So, how do we go about putting a stop to this very expensive sharp practice? It's actually quite easy (But few companies have the courage to follow up.)

Vote with you wallet. Start, today, keeping track of your costs--real or imagined--relating to repairing products containing defective or insecure code. Next time you make a volume purchase--or negotiate a support/maintenance agreement--explain (very gently) to the re-seller how you expect compensation for these hidden costs. Would you actually have the commitment to do this? Would you be courageous enough to drop this provider in favor of a competitor who actually produces a quality product and is willing to work with you on price? Probably not. If that's the case, don't complain when you pay out enormous sums of scarce resources on defective products.

How would you handle a new automobile full of defects? (Can you spell Lemon Law?) How about a poorly built home? A passenger aircraft with defective parts? A poorly designed and maintained highway bridge? Get my point? Are you the customer--or the clueless cash cow? You decide--it's your money after all.

Technology licenses & agreements are killing your business.

Here's the thing: The technology agreements that legally bind your company are not merely onerous; they're downright deadly. And the most chilling factor is that most enterprises are not even aware that they're in trouble--frequently paying serious money for phantom value.

Don't believe me? Try this simple test: Look at the license for any item of software your company uses. Look under "Disclaimer of Warranty" for the phrase "fitness for use" and tell me what it says. Can't find it? Here's a hint...

The software publisher "...makes no warranty or representation, either express or implied, with respect to (the) software, its quality, performance, merchantibility, or fitness for a particular purpose...and you're assuming the entire risk of quality and performance..."

This clause is pretty much standard in nearly every operating system or software licensing agreement. It's meaning is clear:

This mission critical product doesn't have to do anything we said it was going to do. It can be completely defective and, when it fails to deliver value, it isn't our problem, it's yours.

Let me ask a simple question series. Maybe it will bring home the message.

• Would you purchase a car with this warranty?
• How about purchasing a ticket on a cross-country flight where the aircraft was covered under the same warranty?
• Any chance you'd accept the services of a hospital or surgeon with this one?
• Then why are you permitting the software industry players to force this clause on you?

I suggest you look over the Knowledge Briefings on the BizTechNet.org site covering Acquisition Criteria, Product Functionality, and/or Acceptance Testing. When you spend money--invest serious company revenue in a product that purports to deliver a specific value--you deserve to GET that value.

Is your enterprise in the business of financially supporting the technology industry vendors/suppliers? Or are you in business to deliver a specific product or service using the productivity tools provided by these vendors/suppliers? Are you working to improve your business, or theirs?

Reduce Business Technology Costs: Avoid Superceding Licenses

We should all know better--but, for some odd reason, we don't. According to some industry experts, we fail to negotiate as much as 75% of software license agreements. As a result, the typical enterprise is leaking serious cash from the technology budget.

Real World - We gain as little as $1 in actual business value from every $14 we spend on technologies.

Consider the following risk to your budget:

• You finally invest a little time negotiating a software license agreement. You get favorable terms and conditions as well as a decent price (decidedly NOT typical).
• Six months later an employee downloads an update to the product and you discover that your carefully negotiated license has been superceded by a conveniently stealthy click wrap license.
  

Yes, Virginia, it happens quite frequently. The software industry is very aware that your employees and technical consultants rarely take the time to read license agreements. The result is a distinct set of considerably onerous clauses slipped quietly into alternative licenses that legally supercede your existing agreements.

For examples of how these alternative licenses can cause serious financial damage to your business, check out the brief article covering shrink wrap and click wrap embedded in the title link. (Sign in is necessary but it costs you nothing.)

Is that Free Software Download a Deal?

I'm not so sure. Keep in mind that, in the average corporation, nearly ANY employee could easily bind you to the license coupled to the product I am going to discuss.

Last week I found a seriously useful "free download" product that enables you to manage the power consumption of your computer--great idea, right? As one of the world's more slightly pessimistic IT consumers, I carefully reviewed the web site for functionality details. Everything looked pretty good so I decided to try it out. I initiated the "free download" and we were immediately off to what I prefer to call the software licensing sharp practice races.

For those of you who may not be aware, a majority of those free software downloads from the Internet have a licensing process entitled "click wrap" as part of the download. Most of these licenses are acceptable (barely) but many of them are deadly when placed on an enterprise computer.

My first hint that this might be a problem download was when the pre-load license popped up in its tiny little box. You know the license box I mean? It usually measures about two inches high by four inches wide on your monitor and conveniently hides three to thirty pages of highly complex and legally binding license terms and conditions. (And, yes. It has been tested in court.)

The second hint was when I wasn't permitted to copy the license text out of the box so I could read it--printing was acceptable, NOT immediate reading. (The setting on this permission, in my experience, is one of the most significant flags that you do NOT want to place this product on your system.)

So... I printed the license out. (Remember, 99 out of 100 employees--even a majority of your techies--never bother to read this type of license.)

Guess what? One of the most blatant clauses in this license is that the software publisher could download information about your computer at any time and without notifying you. Don't get me wrong. Naturally, the license included clear statements of "Oh, we're not going to..." yadda-yadda. But, in reality, this free download opened your system up for inspection by both the original software publisher AND any secondary publishers who contributed code.

What's more, and it's also very typical of these licenses, the document was absolutely loaded with onerous terms and conditions. I immediately stopped the download and removed all trace of the product from my system. Maybe you would stop it, too, but how about other personnel in your company?

Might be something to consider...

Business Technology Asset Management: How SaaS is Going to Cost a Bundle!

Listen in as Al Plastow discusses how software as a service is going to cost your company more money while taking away your control over the software you depend on. This quick audio excerpt was taken from a Business Technology Consumer Network software life cycle management training session.

The subject matter includes:

• Loss of perpetual licenses,

• Increased costs due to yearly software “rental,”

• Denial of service for non compliance...

Software Asset Management (SAM) is one of the core professional service areas within the over-all scope of enterprise Technology Portfolio Management (TPM). Virtually any company, of any size, could reduce the costs of business technologies by as much as 25%-30% through simple low cost changes to the business processes governing technology spending.

Click to listen to this 30 second audit cut: Business technology: How SaaS is going to cost you more—in cash and in lost control over tech!

It's Al in your head! (Now, THAT is a chilling thought...)

Lead, Follow, or Get Out Of the Way!

Every time I teach a course, be it software life cycle management, asset management, project management, negotiations, or some related business process improvement content, I run into the same problem. Way too many of the people attending the course make the same comment:

Committment: Our company wants to improve the way we do (this or that) but, when it comes down to actually making the move, there isn't any executive support--no follow-through.

I'm sure you've seen this, too. The enterprise--as a whole--is aware that there are more effective ways to accomplish certain tasks or projects, but it has no formal process for approaching, planning, and implementing a change initiative. What's more, executive management--leadership?--does not, or will not, take a visible role in enacting the business process improvement or change. THIS is where my title content comes into play.

My politically incorrect message to management is this:
Lead, Follow, or Get Out of The Way!

Result? How many times have you heard the lament:

Employee Quote: "I spent the time and effort attending this training, or that seminar, (or the company spend the money) and identified a specific way (or two, or ten) that we could improve business processes in our company. Then, when I came back to work, I wasn't encouraged (permitted?) to make anything happen."

In this tough economy--in ANY economy--a company lives and/or dies by its abilities--its willingness--to evolve. To read more of this post, go HERE