Effective Software Asset Management (SAM) ensures no license goes unused, and no user goes unlicensed. But it is just as powerful when it’s time to renew contracts. SAM provides the crucial software usage data on which all decisions should be based. Depending on the size of your organisation, there is the potential to save thousands in conducting negotiations with major vendors, including Microsoft, IBM, Oracle and SAP – all through careful planning.

Negotiation preparation

Easily as important as the negotiation itself is the weeks of preparation beforehand: gathering and analysing SAM data to understand what your organisation is currently using, taking into consideration any planned changes in the future which might impact internal need, and defining the ideal outcome from negotiations.

The goal of most contract negotiations is likely to be something along the lines of a software license agreement that saves you money or a software license agreement that provides more/better software licenses. But your account manager will have targets to meet, and so it’s best to go into negotiations with a plan B or even a plan C – acceptable alternate outcomes should you be unable to get exactly what you want.

Timing is everything. Although it makes sense to wait until the end of the financial year for contract negotiations, when vendors are running promotions to meet sales targets, the reality is that account managers will be under more pressure to close deals; pressure that’s passed on to you. It stands to reason that the sooner you can begin contract negotiations, the more time you have to negotiate.

Sealing the deal

Understand that what you’ve negotiated isn’t official unless it’s in writing. Verbal promises do not hold the legal status of a written agreement and will mean nothing to a vendor. Software licensing language can be complicated, so make sure you’ve got a grasp on exactly what is permitted, with either a SAM specialist, or SAM tool to accurately monitor and manage the software lifecycle.