7 Software Asset Management Best Practices

Are you struggling to manage your enterprise's software assets effectively?

According to CloudEagle.ai’s SaaS trends report, enterprises use anywhere between 300 to 400 SaaS applications. Without effective asset management, this can lead to overpaying for licenses, losing track of contracts, using outdated tools, and increasing security risks.

That’s why Software Asset Management (SAM) is essential for organizations managing a large SaaS stack. Software asset management is a must-have practice for every company that relies on software for daily operations and growth.

SAM offers several advantages: cost savings, compliance assurance, higher staff productivity, and enhanced IT efficiency.

Enterprises with no SAM program in place tend to overspend on licenses by about 20%.

Here are some software asset management best practices you must follow for managing software assets effectively.

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TL;DR

• Start with a clearly defined SAM policy that outlines your objectives, involves IT, procurement, and legal teams, and ensures compliance is built into every phase of software management.
• Choose a scalable platform like CloudEagle.ai that enables app discovery, license tracking, vendor management, and usage monitoring—all from a centralized dashboard.
• Centralize your entire software stack by consolidating apps, contracts, and licenses to gain full visibility, reduce waste, and maintain licensing compliance.
• Categorize your software based on usage, cost, and risk to identify redundancies, reallocate underused licenses, and make smarter renewal and purchase decisions.
• Streamline SaaS procurement and stay audit-ready by implementing standardized workflows and using CloudEagle.ai’s automated gap and compliance analysis to stay in control.

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What is Software Asset Management?

Software Asset Management (SAM) is the practice of tracking, managing, and optimizing all software assets within an organization. It involves maintaining an inventory of software licenses, ensuring compliance with licensing agreements, monitoring software usage, and making strategic decisions about software procurement and deployment. 

SAM helps organizations reduce costs, minimize legal risks, improve security, and maximize the value of their software investments through proper governance and lifecycle management.

As a result, SAM (Software Asset Management) is a critical system that helps firms in managing software assets by overseeing, safeguarding, and controlling their entire software inventory.

Most enterprises employ a range of software tools for managing their everyday operations, but this may lead to a slew of hassles like underutilization, overpayment, and licensing lapses.

By deploying a SAM solution, enterprises can improve software utilization, decrease costs, reduce risks, and boost operational efficiency. SAM is a component of IT asset management (ITAM), which is software that controls both hardware and software assets.‍

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Top 7 Software Asset Management Best Practices

To manage your software efficiently and avoid costly mistakes, follow these seven proven software asset management best practices.

1. Clearly Define Your Sam Policy

A well-defined SAM strategy is the first step in implementing software asset management best practices. It sets rules for how you buy, use, and track software, and helps you stay compliant with license agreements so you can avoid fines or legal trouble.

Before you begin, decide what your main goals are. Maybe you want to save money, pass vendor audits easily, or make sure licenses aren’t going to waste. It’s also important to involve teams like IT, procurement, and legal when creating the strategy, and include any industry rules you need to follow.

Focus on key areas like software usage, buying, setup, employee movement, and license tracking. This keeps everything organized and helps you avoid paying for unused tools. In short, a good SAM strategy helps reduce waste, improve productivity, and keep your enterprise audit-ready.

2. Select The Right Asset Management Software

Picking the right SAM tool for your enterprise can be stressful due to the wealth of options on the market nowadays. To pick the finest one for your needs, a software asset manager must first define the major features and functionality you desire from the tool.

Here are some key features to consider while selecting the SAM tool for your enterprise;

Software discovery: Ascertain that the SAM tool can discover all the applications existing in your SaaS stack. It must identify all the licenses, contracts, and pricing details of the applications.

License management: To ease compliance, see if the application offers sophisticated license management features like optimization, contract expiry dates, and vendor audit request capabilities.

Monitoring and reporting: Select a SAM solution that can give useful insights into operational and financial indicators, assisting you in optimizing your SaaS apps and usage.

Scalability: Consider your long-term goals and choose a SAM solution that can scale with your enterprise, supporting several SaaS apps from various departments, areas, and platforms.

Flexibility: Ensure that the SAM tool is adaptable, allowing for simple integration with the existing tech stack.

3. Surface All Your Software Assets And Centralize Them

Following the selection of an appropriate SAM solution, it is critical to make use of its features to discover and centralize your software assets.

The software asset management software can aid in the discovery of installed apps, licenses, contracts, and related documents, which can then be consolidated in one central place. This step guarantees that you have an accurate and complete inventory of your software assets.

The following are some of the advantages of centralizing your software assets:

Efficient management: A centralized repository makes it easier to track, monitor, and manage software assets, offering a comprehensive perspective for sound choices and resource allocation.

Improved compliance: Centralizing software assets helps you comply with licensing agreements and regulatory requirements by allowing you to more quickly discover and rectify problems, such as illegal software installs or expired licenses.

Enhanced cost control: Software purchases typically account for 35% of a firm’s annual IT spend. So with a comprehensive overview of your software assets, you can detect duplicate or underutilized programs, allowing you to optimize software utilization, save money through license reallocation, and prevent unnecessary purchases.

Streamlined processes: Centralizing software assets streamlines procurement, deployment, and maintenance procedures, promoting coordination across software management teams and guaranteeing uniformity across the enterprise.

4. Categorize Your Licenses And Analyze Usage

The average company wastes $135,000 on unnecessary SaaS tools.

As already mentioned, one of the main reasons for implementing software asset management is to analyze software licenses and assess where (and how frequently) software is utilized. This step will establish that.

Leverage your IT asset management software's discovery and inventory features to get a complete list of all the software.

Once you get the list, put the software into three groups based on priority:

High-priority software: This comprises apps with high spend, and higher compliance concerns, and will significantly impact your organization.

Low-priority software comprises freeware and open-source software.

Blacklisted software: This includes software that contains malware or has no license and should be avoided. Applications obtained from shadow IT should be included here.

Software management solutions are meant to categorize licenses based on department and uncover areas of unused software. So enterprises can analyze software usage trends to make more informed decisions regarding renewals and future expenditures.

By categorizing software and evaluating usage data, software asset managers can make sensible choices on renewals and future investments and streamline software licenses while ensuring compliance with licensing agreements.

5. Optimize Software Licenses

Optimizing your licenses based on user priority and usage is critical to minimizing overpaying and maximizing the value of your software assets. Detecting and marking duplicate applications for termination can help save money. This can also help you negotiate better prices with vendors for app renewals.

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It is critical for successful license optimization to use a software asset management software that provides real-time optimization insights based on usage and utilization.

A software asset manager must consider three factors when optimizing software licenses: pricing, hidden value, and the future roadmap.

• Under the "Price" factor, focus on decreasing SaaS waste, ensuring mindful subscription renewals, discovering hidden costs, and exploiting discounts for loyalty or bulk memberships.
• In the "Latent value" factor, evaluate cross-application integration, automation capabilities, and staff training needs.
• The "Future roadmap" component involves utilizing machine learning to forecast product innovations, maintaining data privacy and security transparency, and determining if the product roadmap corresponds with your needs.

By considering these factors, the software asset manager can optimize the license inventory and make well-informed choices that match the goals of your enterprise.

6. Streamline Saas Procurement For Better Sam

Effective software asset management (SAM) starts with efficient SaaS procurement.

Organizations can enhance their SAM procedures by simplifying the process. This involves establishing clear procurement requirements, defining responsibilities and roles, and adopting standardized SaaS acquisition procedures.

It is also essential to develop clear procurement procedures to minimize overlaps in software purchases. When employees want new software, the software asset manager and his team should analyze the existing inventory for similar features.

Implementing such a strategy helps prevent duplicate app subscriptions and gives the organization more control over the software added to its inventory. This provides effective resource allocation and cost control.

You can use SaaS procurement software to streamline the SaaS buying process. This will give you complete control and make it easier for you to manage your SaaS assets.

7. Perform Regular Saas Audits  

A software asset management tool is a must-have for keeping track of your company's software licenses and other software assets and being audit-ready at any time.

It tracks all usage, configurations, and upgrades to ensure licensing compliance. A SAM tool helps you be well-prepared for a software audit, which might result in costly fines if you're not properly licensed.

Gartner says the chance of being audited is at an all-time high of over 65%.

Without a SAM tool, gathering all the necessary documents for an audit can take a month and 1-2 employees, which is both expensive and time-consuming.

Using an IT asset management software makes your software usage more visible, increasing your reputation and lowering your chances of receiving software licensing fines.

To help prevent this, a SaaS asset management tool provides two types of analysis:

• Gap analysis: Recognizes all existing software that doesn't have proper licensing.
• Compliance analysis: Recognizes over-licensed and under-licensed software. As a result, it helps to avoid compliance problems.

Looking for the best software for asset management that combines scalability, flexibility, and extensive features? Look no further than CloudEagle.ai, the ideal solution for SaaS asset management!

CloudEagle.ai offers comprehensive software asset management functionalities. This includes application discovery, contract, license, and vendor management, usage and spend tracking, and security and compliance features.

Sam Middleton, Head of IT at Bloom & Wild, offers insights into navigating challenges like acquisitions and renegotiations with vendors. Discover his strategies for reducing SaaS costs through effective management platforms and optimizing your SaaS costs.

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How CloudEagle.ai Helps Implement Software Asset Management Best Practices?

Managing software assets manually across different departments and tools can be time-consuming and error-prone. CloudEagle.ai solves this by offering an all-in-one SaaS management platform that gives enterprises complete visibility and control over their SaaS stack.

From discovering hidden apps to managing renewals, licenses, and vendor contracts, CloudEagle.ai helps you do it all effortlessly.

Here’s a breakdown of how it works:

Automated SaaS App Discovery

CloudEagle.ai automatically discovers all the software applications your company is using through its AI-powered discovery engine, including those that IT teams may not be aware of.

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It integrates with over 500 apps, including finance systems like Expensify or NetSuite, SSO providers like Okta, and even browser extensions to track every SaaS app, regardless of where it was purchased or who bought it.

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This enables you to uncover shadow IT—apps subscribed to without IT’s approval—and consolidate them into a single, organized dashboard. With complete visibility, you can effectively manage licenses, monitor usage, and prevent surprise renewals.

Centralized License Management 

Once CloudEagle.ai has identified all your software apps, it brings all license-related data into one central location. You can see who owns each license, how many licenses are active, and when they’re up for renewal. This eliminates the need to manage software through spreadsheets or scattered documents.

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You’ll also be able to view license assignments across teams and departments. This helps avoid duplicate purchases and ensures that licenses are only allocated to users who need them.

Real-Time Usage Monitoring

CloudEagle.ai tracks software usage across your organization in real-time. You’ll be able to see how often employees log in, how frequently tools are accessed, and which departments are actively using each app. This data helps you understand which tools are mission-critical and which are just collecting dust.

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This level of insight is crucial when preparing for renewals or looking to cut costs. If a tool is barely being used, you can eliminate it or reassign the licenses to someone who needs them.

License Optimization Suggestions

CloudEagle.ai doesn’t just organize your license data—it also helps you use it smarter. Based on real-time usage analytics, the platform recommends optimization actions like downgrading underused licenses, reclaiming unused licenses using license reclamination workflows, or terminating overlapping tools.

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For example, if a user has a premium license but uses only basic features, CloudEagle.ai will suggest switching to a lower-cost plan. 

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It also identifies redundant apps—tools that serve the same purpose—so you can consolidate them and save money during renewals.

AI-Powered Contract Management

Managing software contracts across scattered teams and email threads often leads to missed renewals and delayed decisions. CloudEagle.ai solves this by centralizing all your contracts in a single dashboard.

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Its AI-powered metadata extraction automatically captures and tracks key details—like renewal dates, payment terms, contract values, and auto-renewal clauses—so nothing slips through the cracks.

The platform sends timely reminders before renewals, helping you negotiate better terms or cancel tools you no longer need. It also keeps a record of contract owners and negotiation history so that teams are aligned during renewal cycles.

Vendor Management

CloudEagle.ai gives you a complete view of every software vendor your organization works with. It tracks spend by vendor, license volumes, app performance, and open issues. It also surfaces any vendor overlaps—like using two similar tools across departments—that could be consolidated.

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With this insight, your procurement team can confidently negotiate better pricing, reduce the number of active vendors, and eliminate duplicate contracts.

Audit-Ready Compliance Reports

One of the most valuable features of CloudEagle.ai is its ability to keep your company audit-ready at all times. The platform generates reports that highlight license gaps, unused seats, compliance risks, and discrepancies between usage and contracts.

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You can easily share these reports with legal or procurement teams when preparing for a software audit or vendor negotiation. This proactive approach reduces legal risks and ensures that your organization is always prepared for vendor reviews.

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Conclusion: Implement Software Asset Management Best Practices

Enterprises rely on multiple software licenses for their daily tasks, making it necessary to build a system for tracking their usage. Failure in properly managing software assets can lead to decreased productivity, regulatory issues, cybersecurity threats, etc.

As a result, establishing IT software asset management is critical for managing and tracking IT resources within an enterprise.

CloudEagle.ai provides a comprehensive IT asset management solution, and you can book a demo with one of our specialists to learn more about how SAM may help your organization's software asset management initiatives.

Frequently Asked Questions

1. What are the top asset management best practice guidelines?

The best practices include defining a clear asset management policy, using automated tools, involving IT, procurement, and legal teams, maintaining accurate asset records, optimizing usage regularly, and ensuring license and contract compliance to avoid waste and risks.

2. What does asset management software do?

Asset management software helps enterprises track, monitor, and manage all their software and hardware assets. It provides insights into usage, renewals, costs, and compliance, helping teams make informed decisions, avoid overspending, and stay audit-ready.

3. What are the 5 stages of asset management?

The five key stages are:

• Planning: identifying asset needs and goals,
• Acquisition: purchasing or subscribing to assets,
• Deployment: installing or assigning them,
• Maintenance: tracking usage and updates,
• Disposal: retiring or replacing unused or outdated assets.

4. What are examples of software assets?

Software assets include SaaS applications (like Zoom or Slack), installed desktop software (like MS Office), software licenses, subscriptions, APIs, and vendor contracts that support day-to-day enterprise operations.

5. What are the 3 pillars of asset management?

The three pillars are:

• Visibility: Having a complete view of all software assets,
• Optimization: Reducing waste and ensuring smart usage,
• Compliance: Following license agreements and avoiding legal risks.

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