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Gartner has just published a new report, IT Market Clock for ITSM 2.0, in which Software License Optimization solutions are called out as an ITSM “asset class,” and Flexera is referenced as one of the Software License Optimization tool providers in this space.  This is Gartner’s first ITSM 2.0 Market Clock, which is now one of the three categories into which they have divided the whole of IT Operations Management.  The report illustrates the relative market maturity/commoditization levels of the asset classes in ITSM 2.0.  Some highlights from the report, below.

This is the first year that Software License Optimization has been added to a Gartner Market Clock, and has specifically been added as an asset class of IT Service Management (ITSM) 2.0.  Asset classes in this report are those tools that support maturing ITSM implementations for organizations transitioning from a reactive to proactive service orientation.

Gartner ITSM Market Clock Graphic Aug15 v3

Figure 1: Gartner IT Market Clock for ITSM 2.0 (Excerpt)

Software License Optimization is categorized in the “Advantage” stage – the earliest stage in the market where the technology is procured for what it delivers.  This is still the early adopter stage where products are highly differentiated, innovative and command higher prices.  There is also higher risk in this stage because higher skill levels are needed to exploit the solution and full benefits may not be realized.  Strategic advantage is derived through choice of supplier and/or delivery model.  We see that IT Asset Management solutions are placed in the “Cost” quadrant, where the market is mature, commoditization high, and cost is the strongest motivator in procurement decisions. IT Service Management Tools are in between, in the “Choice” stage, which has the highest demand growth rate.

Software License Optimization’s placement close to the center of the market Clock chart signifies that it is an asset class that is not yet commoditized (versus asset classes placed at the perimeter, which are highly commoditized).  In fact, Software License Optimization tied for the lowest level of commoditization, along with Unified Endpoint Management.

Gartner recommends action regarding Software License Optimization within 12 months, reflecting the highest level of urgency.  The specific recommendation is: To achieve fastest ROI and gain visibility into software license position, companies should ensure that discovered inventory data is accurate and sources reliable.  Success is dependent on the accuracy of this data. I would add that accuracy of the license entitlement data is also critical—which means keeping good records of purchase orders and contracts for software. Ideally, you have a central asset management database (AMDB) where you can keep track of all of this data.

The Software License Optimization asset class summarization lays out a few key points in the “User Advice” section, including the following:

  • Gartner recommends selecting a Software License Optimization vendor based on its ability to support licensing models across the entire software portfolio.
  • The vendor software SKU and product identification libraries will also require constant updating as software publishers are acquired or vendors have new releases. So, select a Software License Optimization vendor that maintains up-to-date content libraries.

In the business impact section, the Gartner report notes that Software License Optimization tools help organizations respond more quickly to software license audits and reduce the risk of unplanned audit true-up expenses. And, license optimization capabilities provide enhanced visibility into an ideal license deployment, reducing operational costs.