Optimising Software Assets
A €2,5 billion specialised industrial service provider was struggling with:
1. Overly complex relationship with a major software publisher
2. Spiralling software costs across multiple agreements
3. Inconsistent contractual terms across business units
4. Limited visibility into actual software consumption
5. Inability to leverage scale for better commercial terms
Objectives
1. Achieve significant cost reduction.
Identify and execute strategies to substantially lower the total cost of ownership while maintaining necessary functionality.
2. Harmonise contractual framework.
Transform a complex web of 100+ individual agreements into a coherent, manageable contractual structure.
3. Implement consumption-based approach.
Move from asset-based to consumption-based management to ensure the organisation pays only for what it actually uses.
4. Establish governance model.
Create sustainable processes to maintain optimisation beyond the initial engagement.
5. Enable data-driven decisions.
Provide leadership with clear insights for strategic software investment decisions.
Implementation Approach
Strategic negotiation playbook
We developed a comprehensive negotiation strategy leveraging market intelligence and competitive benchmarking to maximise bargaining position.
Consumption intelligence framework
We implemented systems to capture actual usage patterns across the organisation, establishing monthly reporting mechanisms with actionable optimisation recommendations.
Contract analysis and consolidation
We reviewed approximately 270 existing contracts to identify obligations, risks, and unfavourable terms, then created action plans to address these issues.
Entitlement mapping and valuation
We developed a detailed entitlement registry with clear TCO metrics, distinguishing between essential and non-essential services based on five key parameters:
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Business case justification (Why)
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Feature criticality assessment (What)
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Deployment timeline analysis (When)
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User requirement matching (Who)
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Technical infrastructure evaluation (How)
Demand forecasting methodology
We created predictive models for future software needs based on business growth trajectories, enabling scenario planning for various business outcomes.
Contract lifecycle management
We led all aspects of the contracting process from initial term sheets through final approval, ensuring alignment with business objectives.
Outcome
The implementation delivered several significant results:
Dramatic cost reduction
Reduced expected five-year software spend from €51M to €33M through precise alignment of licenses with actual business needs.
Structural optimisation
Transformed the contractual framework from a complex patchwork to a streamlined structure, shifting focus from administration to strategic relationship management.
Sustained value realisation
Implemented governance systems to ensure continued optimisation beyond the initial transformation program.
Enhanced decision intelligence
Established data-driven processes for informed software investment decisions based on actual consumption metrics rather than vendor recommendations.