5 Essential Disciplines for Effective ITAM

By Rich Reyes

Building and sustaining an ITAM program are nontrivial tasks. There are constant challenges or struggles that you will face throughout your journey before you reach a managed or optimized state of maturity. Having established and led a well-respected ITAM function for a Fortune 100 retailer with $60B in annual revenue, below are the five (5) essential disciplines worth sharing from my experiences as a practitioner. It’s not a secret formula to success by any means, but serves as “food for thought” as you put in the hard work and diligence required to reach your intended destination:

1. ITAM accountability and responsibility are clearly defined for each stakeholder department

Given the cross-functional nature of ITAM, it’s crucial to define and agree upon who needs to be accountable, responsible, consulted and informed for each process area and major activities. It’s easier said than done, but completing a “RACI” exercise with representation from key stakeholders across IT, Finance, Procurement, Legal and Information Security is an important step to ensuring success for your ITAM program. ITAM programs that have well defined “swim lanes” tend to thrive over those that don’t.

More often than not, ITAM program owners will work in a vacuum, authoring well written policies and procedures that have not been socialized across their stakeholder teams. Having an ITAM operating or steering committee that meets regularly will create a forum for “RACI” discussions to occur, along with the sharing of top program initiatives, challenges, milestones, and successes. Also, creating this structure will help ensure that ITAM is infused into CIO and IT strategic discussions to help influence decision making.

2. IT asset classes and types are documented in an ITAM policy that’s been formalized

It’s table stakes to have an ITAM policy that sets the scope and objectives for your program, among other critical components. A step that is typically not given enough attention or thought is defining the IT asset types and classes for hardware and software across your enterprise, and instating the ITAM policy. Many organizations have a plethora of IT assets, including but not limited to, servers, software, peripherals, networking equipment, etc. ITAM programs that attempt to “boil the ocean” and don’t explicitly list out asset types (e.g., on premise or hosted) and classes (e.g., workstation, mid-range server, mainframe, etc.) that are included and/or excluded generally run into issues when having to verify the completeness and accuracy of their program elements.

ITAM leaders should cross-check with IT Finance or Accounting on the useful life and depreciation rate for each asset class, and validate which specific assets are worth managing within their ITAM program. In some cases, IT may procure assets that won’t appear on the company’s depreciation schedule or are deemed to have little book value, so therefore, they can be omitted from the ITAM team’s scope. Case in point may be peripheral equipment such as mice or keyboards purchased and managed by IT.

3. Distinguish between hardware and software ownership within your ITAM program

ITAM programs are often challenged with knowing their own identity, and demarcating their software related responsibilities from their hardware duties. Software Asset Management (SAM) drives a lot of attention due to vendor audits that may result in material unplanned license and support fees. ITAM owners don’t want their CxOs to learn of vendor or audit non-compliance so they allocate a lot of focus on the software side, but don’t dedicate the same level of effort to Hardware Asset Management (HAM). It’s a leading practice to have both software and hardware specialists that work in their respective domains, but collaborate when/as needed.

Given software is installed on hardware machines (physical or virtual) either on-premise or hosted, there is strong affinity between the two, but still valid business reasons to maintain separate disciplines within your ITAM program. For example, you may employ resources who are experts in software licensing and compliance, but don’t have sufficient experience with fixed asset depreciation or IT asset disposal. Also, dealing with the complexities of vendor licensing models and addressing inbound supplier audits can consume valuable time and resources, so it’s prudent to have dedicated HAM staff as part of your overall ITAM program to ensure hardware related priorities don’t fall through the cracks. Approach your journey with an appreciation that ITAM is the superset of SAM, and it includes the lifecycle management of both software and hardware assets from requisition to disposal; therefore, each area requires a talent investment by your company.

4. Self-evaluation and self-promotion are ongoing initiatives for your ITAM program

The typical ITAM story is one where a program is successfully launched with initial buy-in or adoption from cross-federated teams, but eventually loses its “mojo” and never proves its expected value to the business. It’s typical for ITAM functions to have executive level support early on due to a compelling IT event such as a merger, acquisition, or vendor audit, but then experience a shift in CIO priorities, which prevents them from achieving their desired aims and objectives.

In order to stay clear from this unwanted path, ITAM leaders should establish a process to self-assess or evaluate themselves on a regular basis. The current ITAM program state, gaps or deficiencies, and solutions for improvement should be tracked and managed accordingly. In addition, program achievements such as realized IT cost savings, more strategic vendor deals, or cost avoidance by defending against a software audit should be celebrated and evangelized across enterprise. These activities will remind ITAM stakeholders of what progress has been made, the ongoing value being delivered, and why the CxO suite should continue to invest in an ITAM program.

5. Contract renewals must be a core offering of ITAM

As a former ITAM program owner, one of the highest-valued contributions of my team was to provide support and maintenance renewals (as a service) for the IT organization. Unfortunately, many companies “rubber stamp” their IT vendor renewals as they don’t have the time, resources, or knowledge to deconstruct their agreements before they expire. As a result, money or savings is left on the table and financial risk is not diligently mitigated.

It is a leading practice for ITAM programs to challenge status quo on each renewal before the current term ends. Questions such as the following should be raised to application owners and/or product SMEs at least 90 days before the contract expiration date:

  • Is the support level (e.g., 24×7) commensurate with the business or application needs?
  • Does the support amount or quantities align with the vendor technology actually in use?
  • Have 3rd party support options been considered (e.g., Rimini Street) for stable workloads?
  • What is the current application roadmap & should a multi-year commitment be considered?
  • How many support calls have been logged and what is the contract cost per ticket?

ITAM programs can deliver actionable insights and data to help IT leaders rethink vendor arrangements in order to save or reallocate limited IT OPEX dollars and help preserve innovation funds, without exposing the business to a significant level of operational risk.

About the Author

Rich Reyes is an Executive Vice President for the Global Software Advisory practice at Connor Consulting. He brings 20 years of thought leadership around software licensing & compliance, technology asset management, and IT sourcing. Rich has performed hundreds of software audits on behalf of major vendors, and he’s established and led an ITAM department for a Fortune 100 retailer. He continues to advise companies on practical ways to mitigate IT supplier risks, reduce vendor total cost of ownership (TCO) and optimize software licensing environments. Rich holds CISSP and CISA certifications and is a frequent speaker at industry events.