Behind the scenes: IBM licensing audit

When a licensing vendor knocks on your door and says, “it’s audit time”. You can react in a number of ways. Regret. Panic. Fear. Surrender. Let me share the experience of a Cloud Optics client who was thinking “OK, I know it will keep my team busy, but we’ve got processes in place, I feel confident it will be alright. No need to panic”.

Fast forward 3 months, the client had done everything within their power to be open, honest and transparent with the vendor. They had nothing to hide after all.

Imagine their surprise when the licensing vendor said: “Thank you. Here’s the licensing shortfall. And please can you get your purchasing department to place that 8-figure purchase order.”

Yikes.

8 figures. It wasn’t in the budget. Surely our processes haven’t failed us, they thought.

At this point, the client and licensing vendor hit stalemate. They couldn’t agree an amicable way forward. The client was having board level discussions about the 8-figures. They were questioning the audit results. No decisions were being made.

So, what did the client do?

Well they called Cloud Optics. They’d approached us a few months earlier, about our licensing services, but didn’t see the need for our services at that time. Fast forward to an 8-figure licensing impasse, they wanted our help.

Now at this point, I’d love to say we had one meeting, found the issue. But that wouldn’t be an honest reflection of what happened.

The reality is that Enterprise licensing is complex. You may have seen an earlier article from me about that very subject. If you’ve got 1000’s of licenses there is no quick fix. If anyone tells you there is, please send them to me and I’ll re-educate them. Which is why we only employ consultants who have years of hands-on licensing experience and preferably vendor experience.

So, on day 3 of his new role at Cloud Optics, we sent in Ivo Costa. And no, he doesn’t wear his pants on the outside of his trousers like Superman, but he did deliver an outstanding win-win for the client and vendor. He’s one of the good guys.

Why?

Because we hire exceptionally talented licensing experts, like Ivo who has:

  • Years of experience at a licensing vendor.
  • In-depth knowledge of the licensing gotchas that typically confuse audit results.
  • A sophisticated ability to translate licensing jargon into pragmatic questioning to get to the core of the issue.

We can’t tell you exactly how Ivo did it, that’s our IP after all, but let me share the results.

As a direct result of Ivo’s investigation, he legitimately downgraded the licensing shortfall liability to 5 figures. Yes 5 figures. Now reading this you may be thinking that’s not much…but when you consider the client only paid <1% of the original liability, that’s remarkable.

Not only that both our client and vendor relationship was enhanced. Yes, really! Both sides were happy, the client got confirmation that their initial instincts were correct, they had nothing to fear and the vendor created a better relationship with the client. Shocking I know, given our somewhat tongue in cheek critique of licensing vendors here.

To find out more about how we can help resolve a licensing impasse, contact us for a no obligation chat.

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