HOW CAN BETTER SOFTWARE LICENSE MANAGEMENT RESULT IN COST OPTIMIZATION?

London, Apr 18, 2018: Software licensing is complicated in any organization which is why companies usually purchase software entitlements for hundreds of rights. The rights are then distributed to several employees and machines. Software license management helps organizations to track and document an organization’s software portfolio.

SpendEdge’s latest webinar on the software license management offers an in-depth assessment of the crucial factors influencing the supply market, strategic procurement and sourcing decisions, pricing models, and procurement best practices. The webinar also offers detailed insights into the license management best practices, cost optimization, and software license compliance.

“A good software license management tool will ensure compliance with all such issues and maintain business continuity. Leading procurement organizations can optimize their license spend by negotiating with large suppliers.” – procurement expert at SpendEdge.

Tracking software usage and staying compliant helps companies to plan future purchases wisely by knowing the frequently used software and those that are occasionally used. An excellent software license management tool will ensure compliance with software license agreement and maintain business continuity.

Join the webinar

This webinar on software license management offers insights on:

What is software license management?
Why should organizations have software license management in place?
How procurement teams can yield cost optimization with better software license management
Consequences of non-compliance with software licenses

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Why Should Your Organization Use Procure to Pay Software?

A procure to pay process in a typical organization is lengthy, time-consuming, and laborious. The process starts out with requirement planning, then RFQ, vendor selection, purchase order, goods receipt, order and goods assessment, payment invoice, and reporting. Manually going through all such processes can be hard and laden with errors. Additionally, an organization may be running multiple processes in parallel with numerous vendors, and tracking them might just go out of hand. A traditional procure to pay process involves a lot of checks, authorizations, paperwork, communication, and errors. With a flurry of innovations in this sector, automation has stood out as the clear winner as it helps organizations better understand their spend and increase contract compliance. So why should an organization use procure to pay software?

Benefits of Procure to Pay (P2P) Software

Enhanced spend visibility

Automation eliminates the requirement for a lot of paperwork and enforces manual checks within each stage of the procure to pay process. Automated procure to pay software provides end to end visibility between POs, goods receipts, invoices, and other documents to ensure goods are as per specification before issuing payment. By providing real-time data to both buyers and suppliers, it offers better spend visibility.

Easy access to records

Procure to pay software eliminates all the paperwork and stores all records in the system digitally. As a result, it becomes easier when procurement professionals want to retrieve data on a particular supplier or transaction. They can get the data instantly, rather than having to go through all the files and documents. Also, buyers can easily access the online catalogs from suppliers, and also review and approve purchase orders in electronic formats. Additionally, the cloud-based system can provide selective permissions and encryption to allow multiple levels of access. It can also generate automated reminders to alert users when purchase orders are pending or require approvals.

Catalog management

Contracts are an essential document for any organization. Hence, they store such documents regardless of importance or time. However, it’s not the same with catalogs; they only keep catalogs from a selected few suppliers. Procurement professionals cannot access information on suppliers past offerings or offerings from new suppliers as they do not have their catalogs. An automated procure to pay software helps procurement professionals to link the software with the contract management system and store contracts in the absence of catalogs of a supplier. Such software assists procurement professionals to fetch details and historical costs of previous orders from a particular supplier even without a catalog.

Proactive reporting

The automated procure to pay software has the ability to create reports that provide more profound insights into supplier performance. It can detail over supplier spends over various levels, compliance issues, and status of contracts and shipments. Such real-time reports are valuable to businesses as it assists them with strategic spend analysis and controls their maverick spend.

Want to gain better insights into procure to pay cycle and P2P software?

SPENDEDGE WEBINAR ON 25TH AND 26TH APR – How can better software license management result in cost optimization?

We have progressed far from the days where software was packaged as a product and sold in CDs. Today, with the rising popularity of Sanya cloud-based platform offerings, suppliers are more inclined to provide their product in a subscription-based model. More precisely, they provide access to their software in the form of license. Since software licensing cost takes up a majority of the cost base within an organization, procurement teams should always be on their toes to explore various licensing models and choose the right fit for their organization needs. Software licensing is complex in any organization. Companies usually purchase software entitlements for hundreds of rights, which are then distributed to several employees and machines. Software license management helps organizations to document and track an organization’s software portfolio.

Why do organizations need software license management?

Yatheesh Software license management ensures compliance with a given software’s End-User License Agreement (EULA). EULA typically specifies how a software product can be used and how many users are permitted and penalties in the case of violation. In case the organization is being audited, procurement teams will have to spend a lot of time and resources to inventory all software usage and prove compliance. In case the organization is found to be out of compliance, they have to true-up their licenses where they buy the software at its book price. Additionally, they may also incur some fees or penalties. The company not only lose out on the financial front, but their reputation also takes a blow. Customers and clients of the company may lose faith in them, and their business would suffer. A good software license management tool will ensure compliance with all such issues and maintain business continuity.

How can better software license management yield cost optimization?

Leading procurement organizations can optimize their license spend by negotiating with large suppliers. Also, the teams should assess the role of third-party software asset management companies and the value benefits they offer. Tracking software usage and staying compliant helps procurement teams to plan future purchases wisely by knowing the software that is frequently, rarely, or occasionally used.

Conducted by SpendEdge’s procurement experts, this webinar on the 25^th & 26^th of Apr would deal with the following key considerations:

What is software license management?
Why should organizations have software license management in place?
How procurement teams can yield cost optimization with better software license management
Consequences of non-compliance with software licenses

Biggest Challenges Faced by Procurement Professionals in Indirect Spend Management

Most companies often focus their efforts on direct spend categories and place a low level of importance on indirect spend. However, indirect spend can make up a high proportion of third-party spend in most companies. Often overlooked, indirect spend management is gaining attention due to its ability to derive more value from their supplier spend and further increase savings. Indirect spend management is not so straightforward and easy. Managing IT, MRO, logistics, utility, and travel requires a different kind of skillset and expertise from the procurement teams. If procurement teams are able to manage and take control over the indirect spend effectively, they can create more savings opportunities. So what are the barriers procurement professionals need to overcome to unlock new savings opportunities?

Controlling maverick spends

Maverick spends are purchases made outside of agreed contracts. Companies make many purchases out of their agreed contracts due to various reasons and circumstances. However, it can be detrimental to the organization as no contract means no legal protection and it can also impact the profit and contract fulfillment. Unmanaged spends can account for billions of dollars of ineffective and inefficient purchases in a large enterprise. Additionally, it also makes the organization vulnerable to procurement frauds. A major problem faced by the procurement professionals is the implementation of control measures to eliminate such maverick spends. Organizations struggle to regulate such spends as employees usually try to be efficient by using a ‘just get things done’ attitude. Also, procurement professionals often bypass the contracting system as it is laborious and time-consuming. At an age where agility is necessary, they cannot afford to waste time in excessive documentation. Additionally, sometimes employees can feel that they can find a better deal elsewhere than in the contract offers. It is essential to review HR policies and educate stakeholders of the detriments of unmanaged spend. A review of the P2P process and a proper spend analysis are also essential to put a stop to such maverick spends.

Lack of centralized control

A common misconception outsiders have about the organization is that it sees the company as a single entity. The truth is far from that, as they function with multiple departments with decentralized control. The problem with such decentralized control is that, when implementing indirect spend management, professionals often lack the knowledge of the scale of diversity within their organization. Each department is provided with their own budgets, and have measures and regulations to spend the budget where they need it. This again gives rise to maverick spends and purchases that are not centralized. Therefore, it becomes problematic to assess who is spending on what. To get on top of the indirect spend management, organizations should centralize their purchasing operations. It will not only help achieve economies of scale but also allow greater scrutiny of suppliers and their contracts. Additionally, it eliminates the practices of offering contracts based on each department’s convenience and ensures qualified suppliers are selected. Apart from its contribution in cost-savings, it also affects the non-price factors such as risk management, CSR initiatives, and supplier diversity.

To tackle the challenges arising out of indirect spend management, companies have turned towards automated procure-to-pay (P2P) processes. Such processes eliminate process errors, increase visibility of payments, and provide better control over indirect spend. Additionally, eProcurement, eInvoicing, AP, order lifecycle management, electronic payments, and supplier management are some tools used by the organization to increase visibility and control over their indirect spend management.

For more information on challenges in indirect spend management, maverick spends, and unmanaged spends: