Top 10 Software Licencing Mistakes Enterprises Make

1. Making ad hoc purchases – Allowing employees to make ad hoc purchases and not controlling authorized purchases is a common occurrence. Enterprises often buy licenses as needed in a piecemeal fashion, rather than under a volume purchase agreement, which can be much more cost effective.
2. Not tracking installation and use – By tracking installations of software and its usage, enterprises may be able to substantially reduce ongoing maintenance payments, either because the applications are not being used or because they are no longer supported by the vendor.
3. No central repository – A central repository for keeping proof of software licenses so that they are easily accessible for review allows enterprises to quickly comply with vendor audit requests, saving time and money.
4. Not tracking renewal dates – Not keeping track of software license agreements and renewal dates, makes enterprises vulnerable to lapses in Software Assurance or other maintenance programmes, which can prove costly for enterprises. Some vendors may demand that enterprises just pay maintenance retrospectively to the renewal date, whilst others could make organisations re-purchase the licenses. 
5. No communication between departments – IT operations must work with Procurement to ensure that software is installed and used in accordance with the respective license agreements to avoid software compliance issues. This is often not the case.
6. Not purchasing maintenance at the right time – The right time to purchase maintenance is when enterprises are looking to be part of an upgrade. For example, Adobe has a couple of new software releases planned this year.  If enterprises buy maintenance before the release is announced, the price will be is significantly lower and they will become automatically eligible for that product upgrade. 
7. Not ascertaining strategic requirements – Ordering licences without determining what the enterprise truly requires over the longer term could be an expensive mistake. For example, an enterprise might need just Microsoft Exchange & Windows Client Access License’s (CALs) now, but in six to twelve months time decide that it actually needs to deploy SharePoint. In the context of this example, a CORE CAL would be the better option – offering all three applications in a bundle – as it will save the enterprise money over the long run.
8. Assuming licensing rules don’t change – Licencing rules change frequently and enterprises need to stay on top of all the vendor rules and regulations.  Not doing so can result in enterprises being out of compliance, which could be a costly oversight if audited by software vendors. This situation is now being further exacerbated with the proliferation of visualization technologies and cloud computing.
9. Not applying the Product Use Rights – Product Use Rights define how software licences can be consumed. They include upgrade, downgrade, second use, virtual machine use and multiple version rights. Accurately applying them can drastically reduce licence consumption and hence reduce the need to buy more licenses.
10. Not automating Enterprise License Optimization – An optimised licence environment cannot be achieved without an automated solution. Enterprise Licence Optimisation solutions, also known as next generation software asset management tools, enable enterprises to collect all the necessary data – from asset inventory to purchase orders and organisational data – and apply licence entitlement rules to generate the necessary reports to effectively manage software licenses.