Managing Software Licenses and Entitlements in Complex Organization Hierarchies

Most software vendors are proud to call large, global enterprises their customers. However, only few appreciate the effort that these enterprises have to invest to stay in control and manage licenses within their organization, and consequently only few software vendors provide their enterprise customers with the right tools to streamline the related processes.

Enterprises using software are challenged with managing licenses, entitlements and devices within a sophisticated network of subsidiaries and other organization units like departments and cost centers, usually within a multi-level hierarchy. Each organization is structured differently and there are innumerable ways in which enterprises structure their license management processes. Here are just a few common scenarios:

  • Central purchasing and management – all software licenses are purchased centrally by a headquarter or holding entity that also manages software licenses for the entire organization
  • Central purchasing, decentralized management – the purchasing processes are centralized but local entities within the organization manage and activate licenses (for example per country)
  • Decentralized purchasing and management – in this scenario each entity buys and manages its own licenses. However, there might be a central unit that takes care of compliance and internal or external audits
  • Service providers manage purchasing and/or management – many enterprise organizations have spun off their IT and/or their purchasing entities into separate organizations that purchase or manage licenses in a service delivery model

Organization-Management
Figure 1: Example for an organization with central purchasing
but decentralized license management processes

Obviously, more scenarios exist and organizations that grow through mergers and acquisitions often have to use a variety of different models as they try to integrate new organizations into their groups of companies.

What can Software Producers do to Make it Easier?

Like in many areas, software producers can help their customers by providing the right tools and processes to tackle administrative tasks:

  • Provide enterprises with the possibility to replicate their organization structure within the entitlement management system in a self-service model
  • Offer the right set of permissions and security roles so that different users in different parts of the enterprise organization can be enabled to manage licenses for the entities they are responsible for whilst preventing access to licenses or devices that are being managed by someone else

This way, enterprises are enabled to stay in control of their licensing and compliance management processes. It will be easy for them to enable users of a parent organization to manage licenses for connected entities (in a centralized approach), or enable users of one entity to see and activate licenses from a parent organization (in a central purchasing but decentralized license management approach) or authorize users from a technically unrelated service organization to manage and activate licenses for some or all entities of the organization (in a service provider approach).

Last but not least, purchasing and billing processes can be streamlined between the enterprise and the software producer as licenses and entitlements can directly be linked to the right part of the enterprise organization.

If you are a software producer or intelligent device manufacturer selling to larger enterprise organizations, you should consider providing your customers with organization management tools. It will not only streamline processes for your customers but it will also make it much easier for you to deliver support.

What challenges are you facing when working with global enterprises? Let us know!

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Categories: Entitlement Management, General

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