6 Ways to Save Money on Engineering Software

The high cost of engineering software programs is a pain-point for many organizations from multi-nationals to small company engineering shops. Paradoxically, many of these companies do not have effective mechanisms in place to monitor their software inventory and usage; they may for example have multiple agreements in place with the same vendor for the same software.

Our CEO was astonished when, in a recent conversation with one of the world’s largest engineering companies, they admitted that they did not have a clue about what engineering software they had on board. The fact that the cost of an idle engineer far outweighs the cost of acquiring another licence is often given as justification for how such a situation can arise but this is not a justifiable reason for non-management of your software assets.

Inadequate software management often starts at the planning phase. Bidding for and winning contracts can take months, if not years, and desk studies, project plans and resource scheduling is done long before the project is started. Furthermore, until the licenses are finally acquired, conditions and circumstances may well have changed, and the documented predicted software usage may no longer be current. A danger of over-licensing at the organizational level exists when there is a lack of centralized license control, where projects are estimated without taking into account the economics of using software that is currently lying unused within the parent organization, or will become free by the time the new project gets under way.

Software license control should be part of the CIO’s portfolio and if there was effective centralized licensing monitoring control in place, the points raised below would probably not arise. Centralized software license management may take time to implement, but should bring about a marked reduction in engineering software spend. There is some admin work required but this is a small price to pay in exchange for knowing how your software is being utilized across the organization.

While license monitoring has become a complex task in recent years, there are software licensing tools available that reduce the time and cost overheads and offer the potential for impressive cost savings. These actions will also reduce the risk of non-compliance fines in the case of a software audit (see our post on software compliance). To get you started with rethinking your license spend, here are five approaches that can optimize software usage throughout your company without increasing the risk of denial-of-service to your most valuable assets, your engineers.

1.   Know What You Have

This is an essential part of centralizing responsibility. Unearthing all your instances of engineering software licenses is a challenge, especially where they were bought for projects that have completed, or were used in a different geographical location, where they may have been purchased from the local representative of the vendor. If you do not have a clear idea of what software you own, your chances of being found non-compliant in a software audit are higher. It’s not such a great idea to rely on your vendor for accurate licence management either; you should always keep your own records. And, once you have catalogued all your licenses for a vendor , you may be in a position to work out a better deal, especially where they appear to have been overzealous in selling you licenses, which leads us to the next point.

2.   Timely and Organized Renewals Can Save Money

Multiple instances of licenses for the same product do occur and sometimes cannot be avoided, especially where you are operating multi-nationally and are receiving support from the vendor’s local offices. This is the time to formulate a strategy for your vendor relationship. You do not want to be in a position where you have multiple renewal dates for your CAD engineering software, for example. If you can identify all the instances of licenses for a particular vendor, you can work out a solution that requires only one renewal per annum and will help you root out licenses you do not need. Resolving this situation also helps ensure that you are software compliant with that vendor. Multiple license agreements is associated also with the problem of multiple license managers.

3.   Multiple instances of the same license managers

This happens more frequently than you might think. A typical case is where the mechanical engineering department purchased some CAD licenses a few years ago and the maintenance is still renewed. Subsequently the electrical engineering department purchased the same software for a specific project, followed by the civil engineering department. The acquisition of another engineering company that uses the same CAD software in Asia adds another layer of complexity. The CAD vendor supplies a license manager with each sale, resulting in 4 different license managers being installed and administered by 4 different business units. Maintaining multiple license managers for the same vendor gives rise to:

  • Unbalanced license availability – Some departments may suffer from high demand and license denials while others may have many unused (or “shelf”) licenses.
  • Ineffective utilization of licenses – It is not possible to optimise the license utilization across these separate license managers for each vendor.

License server consolidation is a measure that can simplify license management and provide substantial savings and additionally improve utilization efficiency of your licenses.

4.   Use some Machine Intelligence

While vendors may or may not provide a license manager to manage your use of their products, you do not want to be in a situation where you do not have a comprehensive single view of all the licensed software tools you have purchased. In a study by Opinion Matters, it was found that over 50% of companies who did perform some form of license internal control used spreadsheets for this purpose. This is not an effective license monitoring method because while you might have all the products in one list, it tells you nothing about utilization, idle software or denials-of-service to frustrated engineers. OpenLM on the other hand is a self monitoring and internal audit solution that can help get control of the software you have in your organization and its usage, that extends way beyond mere inventory. One of these is monitoring of individual usage of licences, and the ability to control license hogging, which is our fifth pointer.

5.   Ensure Equitable Use of Software

Engineers typically use several software tools available to them today in the engineering space. Some of them like to have them constantly close to hand, even when they are not using them and will book out a license at the start of day whether they intend to use the software or not. If the license admin had the ability to find software that has been booked out and is lying idle, suspend the idle session and free up the license (license harvesting), software hoarding could be eliminated. This is a valuable feature, especially during periods of peak usage. It will no doubt cause some negative reaction from the software hoarder initially, but it will soon be recognised that the software library is there to be shared with others in the company and the discipline of only booking out software when it is needed will gradually become ingrained in the organization. Managing idle licenses effectively will help you to identify whether you really need to purchase more licenses of your preferred CAD engineering or simulation software or not.

6.   We did an Optimization in the Past

Finally, some admins are under the mistaken impression that license optimization carried out several years ago is sufficient to tide them through till the foreseeable future. New projects, completed projects and mergers and acquisitions will all affect the licensing status quo. Reviewing and administering the software portfolio and the licenses that support it is a continuous task.

In Conclusion

We have briefly described some ways to enhance productivity and reduce costs through dedicated license monitoring and management. In addition, you should be able to reduce risk of unplanned fines from failed software audits and from delayed projects by demonstrating software compliance and reducing denials-of-service respectively.

OpenLM is a software audit and management system for engineering software licenses for more information Contact us or get a free 30-day trial.