Over the last thirty years, the phenomenal growth in the use of computer software has created a new and significant asset management challenge. From many perspectives, including business efficiency, entertainment, information, research and science - software is a wonderful thing. But it is a very difficult asset to control and manage.
There are few businesses in the world today that can confidently assert that they know exactly what software is being used in their organizations, and what software they are legally entitled to use.
Why is the software asset so hard to manage? Software is subtle stuff – it can’t be seen, touched and handled in the same way as a physical asset such as a desk or a chair. Software is very easily copied. It’s a lot easier to copy a software program than to copy a desk.
A second contributing factor is the complexity of software licensing. It’s not well understood that when we “buy” a software program, we don’t then actually own the software. Software is intellectual property. Under copyright law, it is classified as “a literary work”. What we buy is the owner’s permission to use that software under certain conditions.
As a consequence, most organizations in the world today are in danger of legal and financial exposure due to non-compliant software, coupled with other security risks which accompany poor software asset management.
Large software publishers have to tailor license programs to suit organizations of all sizes, and with a wide variety of licensing needs. As a result, most license programs are complex and difficult to understand.
There are three ways of modelling the software in any organization:
These three can be represented diagrammatically as shown:
