Effectiveness and Efficiency in Software Licensing
People talk about lean processes and efficiency with regard to IT but in reality there is confusion about what actually means. There tends to be a focus on effectiveness or ‘get the job done’ for most IT professionals- their prime concern is keeping everything running. If systems go down everyone shouts so of course they want to ensure that everything is working rather than saving every last penny. However, efficiency need not to be achieved at the cost of effectiveness and in fact often the two aspects are complementary.
Software licensing is a bit like the tip of the iceberg you see the cost of the licenses but it is harder to quantify the hidden costs of support staff, security, hosting, hardware and software updates, staff costs, procurement, etc. when you purchase software assets that are not used. If you can optimize your software usage then you will also give cost efficiencies throughout your IT.
Many financial department have the view that IT is expensive and money may be being wasted, however to most people, IT is invisible and hard to identify if the IT is really cost efficient. Manging software assets is not simple they are invisible to almost everyone. So it can be confusing and frustrating for most senior managers to understand if they are investing wisely in their IT assets. IT managers will improve their managerial credibility if they can show they are maximising the efficient use of their software assets.
Many IT managers will say “My area is already efficient, we are meeting all our KPIs and keeping to budget”. This really means that the IT area is effective but not necessarily efficient, two people can be effective in getting a job done but they can have different efficiency levels. For example two people could travel from A to B, they both get there and they are effective in reaching their goal however one takes roads which are less direct and therefore uses more fuel and takes longer than the other therefore one is less efficient than the other. In summary effectiveness is a measuring if you are doing a task whereas efficiency measures how well you are doing the task.
Our infographic will show you the difference between effectiveness and efficiency in software licensing. We also advise you how to achieve our goal as manager effectiveness in the most efficient way.