License smarter, not harder: How optimisation is changing the game

Did you know that the majority of IT leaders admit they’re unsure of their organisation’s software license compliance—and that uncertainty often leads to wasted budgets and unnecessary complexity.

What’s more, 70% of corporate risk and compliance professionals say they’ve noticed a recent shift from check-the-box compliance to a more strategic approach.

In a world where cloud services and digital transformation are driving business growth, licensing optimisation is no longer a back-office function. It’s a critical strategy for staying competitive.

So, what is licensing optimisation? It involves ensuring that software licenses are utilised efficiently, avoiding overspending and compliance shortfalls. By continuously aligning software purchases with your organisation’s actual needs, you can cut costs, enhance efficiency, and minimise risk.

How big is the market? According to Market Research Future, the global software licensing market is projected to grow significantly, reaching a valuation of USD $5 billion by 2030.

Welcome to Part 1 of our Blog Series on the changing landscape of licensing. To gain insights, we spoke with Jo Moore, Interactive’s partner compliance and licensing expert, to uncover the latest trends, best practices, and essential steps for effective licensing.

“For me, licensing optimisation—or optimisation in general—has always been about finding the best value, given my background in procurement. It’s not just about cost; it’s about balancing both cost and quality to suit your needs,” Moore explains.

“In procurement, the focus is often on getting the cheapest option, but I don’t always take that approach. Sometimes the cheapest isn’t the best.”

Moore shares her key advice

Trends in licensing you need to know

1. Shift to Cloud and Subscription-Based Models: The days of boxed licenses are long gone. “When I started in 2007, it was all about physical licenses. Now, everything’s cloud-based,” Moore explains. This shift means businesses now pay for what they use, but it also adds layers of complexity to managing costs.
2. Continuous Management is Key: Licensing is no longer a “set it and forget it” deal. Companies need to constantly review and adjust their licensing as their teams and needs evolve. “Just because a license was right six months ago doesn’t mean it’s still the best fit,” Moore emphasises.
3. Vendor Flexibility: Recently, Microsoft responded to feedback by allowing licenses to be purchased without Microsoft Teams, catering to companies that prefer Zoom or other platforms. This kind of flexibility is becoming more common, but businesses need to stay informed to take advantage of these cost-saving opportunities.

Best practices for licensing optimisation

1. 1. Audit Your Usage: Start by reviewing your current licenses. Are they being fully utilised? Are there features you’re paying for, but not using? A thorough audit will quickly reveal opportunities for savings.
   2. Right-Size Your Licenses: Not every user needs the same level of access. Moore suggests tailoring licenses to actual user needs—some employees may only need basic functionality, while others require advanced features. “Over-licensing is a common trap,” she says.
   3. Repurpose, Don’t Repurchase: When employees leave, their licenses shouldn’t. Repurpose unused licenses for new hires to avoid unnecessary spend.
   4. Leverage Industry Discounts: “If you’re in sectors like education or non-profit, you might be missing out on special pricing,” Moore notes. Make sure you’re aware of any vendor discounts or programs that could slash your costs.
   5. Stay Informed: Keep up with changes in licensing models. Vendors, especially in cloud environments, regularly tweak their offerings. Building a relationship with your vendor ensures you’ll be the first to know about new cost-saving opportunities or feature updates.

Key steps to optimise licensing now

1. 1. Perform a Licensing Audit: Review what you have versus what you need. This helps you identify redundancies and gaps.
   2. Tailor Your Strategy: Match licenses to actual user roles and functions to avoid paying for features that aren’t used.
   3. Regularly Review and Adjust: Licenses should evolve with your organisation’s growth and changing needs. A continuous management approach will keep your licensing aligned with your goals.
   4. Leverage Tools for Real-Time Management: As Moore highlights, AI and automation tools are becoming game-changers in tracking and optimising licenses, allowing businesses to stay ahead of usage patterns and predict future needs.
   5. Pick a partner that has vast expertise in the licensing game – and adept at working with a multitude of partners – to maximise the expertise and know-how.

What’s next for licensing?

As businesses adopt multi-cloud and hybrid cloud environments, licensing complexity will grow—but so will the opportunities for optimisation. Automation and AI-driven tools will increasingly help companies manage licenses in real-time, identifying cost savings and ensuring compliance with minimal manual intervention.
“The future of licensing is smarter,” Moore says. “AI will help businesses predict needs, prevent overspending, and stay ahead of the curve.”

The way forward

Licensing optimisation isn’t just a cost-cutting exercise—it’s about aligning your licensing strategy with your business goals. By auditing, right-sizing, and staying agile, businesses can save money, reduce inefficiencies, and ensure compliance in an ever-evolving digital landscape.
Moore reflects on the evolving licensing landscape, and offers up this practical advice:
“At the end of the day, it’s worth taking stock and reviewing your licensing. Whether anything can be optimised or not, it’s essential to make sure you’re managing it properly, buying the right licenses, and getting the best value for your organisation. Sometimes there’s nothing more you can do, but often, with a little extra attention, you’ll find opportunities to save.”
Moore’s message is clear: The time to optimise your licenses is now. Follow these best practices, stay informed, and embrace continuous management for long-term success.

In Part 2 of this series, Jo delves into the fast-paced evolution of cloud licensing and explains why businesses need to stay agile, build key partnerships, and regularly reassess their strategies. She reveals how this unlocks value and reduce cost in an increasingly flexible and complex environment. To read more – click here.

Interested to learn more? Interactive has the capability to conduct thorough licensing assessments for both existing and new customers, providing valuable insights and recommendations tailored to their needs.