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Vendor audits are pervasive and expensive. According to the Flexera 2025 State of ITAM Report, 45% of organizations paid more than $1 million in audit expenses over the last three years. The chart below highlights the top vendors who’ve been auditing, and when compared to previous reports, the order hasn’t changed much.
If you’re thinking this won’t happen to you, take a look at the common triggers for vendor audits:
- Organizational changes (e.g., mergers and acquisitions/divestitures, etc.
- Lapsed or reduced support contracts
- Significant infrastructure changes
- Lack of license management tools
- Usage increases without increases in license spend
- Missed true-up or self-audit obligations
- Inactivity with vendor account teams
- Whistleblowers
- Suspicious SaaS activity
- Time since last audit (e.g., more than three years)
If you’re feeling uneasy, it’s time to crack open the case and find a solution to fortify your software license position. But you may encounter a frequent challenge we hear all the time: lack of budget. You’ll likely need to communicate the business benefits of enhancing your audit readiness program. Use these statistics from trusted analysts about software audit readiness business benefits to help you build your case.
Benefits of having a strong software asset management (SAM) practice, according to the analysts
- By 2028, 80% of organizations leveraging SAM tools’ AI capabilities will increase the productivity of their SAM teams by 60%, doubling cost savings
- Also by 2028, 60% of organizations that merge SAM and FinOps into a central governance function will report 60% less financial waste from software and cloud investments over 2024, according to Gartner
- By 2026, organizations that reposition software asset managers from centralized execution to strategic governance and oversight will have 30% more efficient software spend than those that don’t
- According to Forrester, successful SAM implementations save license costs, improve compliance and reduce true-ups. They also improve software utilization, enabling firms to derive more value from existing investments; remove unused, unwanted or architecturally unfit applications; and improve vendor relationships with better contract management
Benefits of having a vendor audit defense practice, according to Flexera customers
Most of the benefits offered up by SAM analysts are focused on reducing financial waste. Our customers have mentioned a few other key benefits that you may want to include in your business case.
Number 1: Reduction in audits and reduced audit risk
One of the audit triggers, as mentioned above, is when organizations lack license management tooling. Conversely, having an audit defense practice with robust data reduces your likelihood of being audited.
“Ten years ago, we had five to six audits a year,” said John Haenen, software asset management consultant for the Dutch Police. “Now we have zero to one because they talk amongst each other and they know they will never find anything wrong with our data. And we can prove it.”
By having data on your license compliance position, including knowledge of and optimization of product use rights, organizations can prevent risk related to vendor audits. Here are some examples of customers who’ve been successful:
- Aviva: 100% audit risk mitigation in two IBM audits
- DBS Bank: Gained proactive audit posture using Flexera data
- Baker Hughes: Minimized audit risks via automation and visibility
- American Airlines: Mitigated audits during IBM renewals
Number 2: Cost avoidance
The other side of audit defense is cost avoidance and cost optimization. By having usage data and properly applying product use rights, you can save hundreds of thousands to millions. Check out these examples of organizations that reduced or avoided software spend by having a strong audit defense:
- Heineken saved €4M via Flexera One IT Asset Management and Application Readiness
- Aviva saved £75M over five years
- DBS Bank reduced audit claims from $15M to $200K using FlexNet Manager
- Dutch Police saved millions in euros through centralized license management
- EDEKA DIGITAL saved €6.2M on SAP licenses with Snow Optimizer
- Maynilad avoided hundreds of thousands of dollars in audit exposure
- The Manildra Group reduced SAP license consumption from approximately 450 to 188—within just eight weeks
“Flexera empowers us as the IBM experts, playing a key role in achieving substantial yearly savings on underutilized software renewals. We also promptly report any exposure, effectively mitigating audit risk.”
Number 3: Time savings
Responding to a vendor audit can be very disruptive to your organization if you haven’t taken a proactive stance towards audit defense. Koos Nel, ITAM specialist at Momentum, says it can take a long time, often involving a small army of people across the organization. “One of the greatest advantages we have had with [Flexera One] ITAM was with software audits,” Nel said. “With Flexera, audit times are drastically reduced from months to weeks, requiring only a few people to compile the reports and complete the audit.” With a proactive approach to vendor audit readiness, you can reduce time spent by 75% or more. But don’t just take our word for it: Here are additional examples of time savings from some of our customers.
- Momentum reduced audit preparation from months to weeks
- EDEKA DIGITAL cut SAP audit prep time from one year to less than six months
- Maynilad reduced license data extraction from hours to minutes
- A large enterprise bank reduced audit preparation time by 75% and eliminated unexpected non-compliance penalties entirely over the past three years
Number 4: Operational efficiencies
Operational efficiencies have been mentioned by several of our customers as a key benefit of having a strong audit defense and software asset management practice. Operational efficiencies show up as:
- Improved automation: License tracking, entitlement normalization, compliance reporting
- Enablement of data-driven decisions: Real-time insights support vendor negotiations and cloud cost control
- Cross-platform visibility: Unified views across SaaS, on-premises, hybrid and cloud environments
“Flexera has significantly enhanced our organization’s ability to manage software assets, optimize licensing and ensure compliance. By providing deep visibility into our IT environment, Flexera has helped us identify underutilized software, reclaim unused licenses and reduce unnecessary spending. The automation of license tracking and compliance reporting has also minimized audit risks and improved operational efficiency.”
Protecting your bottom line
By fortifying your software license position, you can significantly lower the risk of audits and the associated costs. Plus, the time you can save in audit preparation—and the operational efficiencies you can gain through automation and real-time insights—can free up valuable resources, allowing your team to focus on strategic initiatives. As the IT landscape continues to evolve, investing in a robust ITAM solution isn’t just a prudent choice; it’s a necessary one to stay ahead of the curve and protect your bottom line.
If you’d like to model what benefits a strong vendor audit practice would bring to your organization, reach out to our experts at Flexera.
