What You Don’t Know Can Cost You: Why IT Asset Management Matters

Small-business owners are generally highly focused on the bottom line. Any expense, no matter how small, can have a ripple effect on the overall budget, so keeping a tight rein on all expenditures is a priority.

However, there is one area in which many business owners aren’t doing everything they can to keep costs in check. When it comes to managing IT assets, it’s not uncommon for entrepreneurs to focus on the initial purchase of the necessary tools and monthly maintenance costs, and forget that these are investments that need to be maximized for the greatest possible benefit.

IT Asset Management Software

By not paying attention to license renewals, for example, small businesses could be paying thousands of dollars more than they need to be each year – and that’s just the tip of the iceberg.

For that reason, IT asset management needs to be a key part of any enterprise IT plan. Without it, you’re going to spend a lot more than necessary.

Audits, Renewals, and Lifecycle Management

In the simplest terms, IT asset management means knowing exactly what assets you have – hardware and software – and where they are, how they are being used, at what stage in their lifecycle they are at, and, if applicable, when they expire and need to be renewed or replaced.

Armed with this information, your IT team can make smart decisions about what equipment to invest in next, develop more accurate budgets, and eliminate waste, all of which can have a positive effect on your overall bottom line.

IT asset management helps reduce costs in several key ways:

Asset management

1) Audit Management.

Many of the major technology companies, including Microsoft, Oracle, and IBM are becoming more aggressive in their customer audits, in which they are looking for instances in which companies are using unlicensed or inappropriately/inadequately licensed equipment and software.

Not only can an audit prove costly should you be out of compliance with your vendor contracts (on average, an IT audit can cost a business around $100,000 or more) but the time you need to spend gathering information to prove your compliance reduces productivity. For example, in one recent audit that made headlines, a major manufacturing company was forced to produce more than 200,000 pages of documentation related to their IT assets.

While your small business is likely to have much less of a burden, using a tool for software asset management that allows immediate insight into what you have and how it’s being used can make the audit process run more smoothly, and save money on fines and fees.

2) Resource Maximization.

Do you know how every piece of IT equipment and software is being used in your company? Is every one of your employees using the software that you invested in and paid licensing fees for? When it’s time for an operating system upgrade, do you know exactly how many machines are on the network and what the memory requirements are?

These are just some of the considerations when managing IT – and some of the areas that could potentially cost your business money. If you invest in a software program that only a few people in the company use, you don’t need to purchase licenses for everyone. Or, depending on the features you use on an application, you may not need to pay for the licensing level you currently have.

By effectively managing the assets and tracking what you have and how it’s being used, you can ensure that you’re getting the maximum value for your investments.

3) Equipment Lifecycle Management.

IT requires ongoing investments to upgrade and replace equipment that is out-of-date, no longer adequate, or expired. Because some hardware is very expensive and needs to be leased, it’s imperative that small businesses stay on top of their lease contracts and when they expire, so as to avoid paying extra fees to continue using outdated equipment – or paying more than they should to unexpectedly replace an outdated machine.

Knowing what you have, when you got it, and when it needs to be replaced allows for better budgeting and expense management overall.

One of the major factors in the success of any small business today is the ability to track key metrics and make decisions based on real data. IT assets are no different. With a robust asset management program that allows for full insight into the company’s holdings and alerts to key issues, small businesses can stay ahead of the curve and better manage their overall IT budgets.

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About the author

Michael Austin

Michael Austin is a Internet Entrepreneur, Blogger, Day Dreamer, Business Guy, Fitness Freak and Digital Marketing Specialist. He also helps companies to grow their online businesses.