The identity of the organisation we’re about to meet is being concealed – for reasons that are about to become only too apparent – but this is a true story. “When I became IT Director I did a tour of the departments trying to get a handle on what we had in terms of systems,” says our Mr X. “I was told we had two AS/400 minicomputers. But when I did an audit it turned out we had ten.”

It may strike you as a bit daft that an organisation – and in this case it was a commercial firm, part of a multinational, no less – can be so careless with its assets. After all, that computer equipment represented significant capital expenditure and, presumably, ongoing support costs. It could also possibly contain out of date, redundant, or even possibly illegal software licences that ultimately could represent legal risk to the organisation not looking after them properly.

“We go into organisations where there are possibly two instances of Microsoft Office on the desktop – say 2000 and 2003,” says James Rowlands, one of the directors of a company called Liken which helps organisations address the problem of getting a handle on IT resources. “They think [this isn’t a problem but it is] – if Microsoft were to come in they’d ask for the chequebook to be brought out in pretty short order. And not getting your Oracle licencing optimised can be a pretty expensive matter.”

The message is that whether you are a profit-making or non-profit organisation, you have to really know what it is you have on the books. Thus the concept of software asset management – an approach which helps users to spring clean their IT cupboards.

But what is really the point in doing this? Well, the negative business drivers include the potential legal ramifications as outlined – and if you’ve ever been the focus of interest of an organisation like FAST (Federation Against Software Theft), who make the VAT people seem like flower children, then the answer to that question would be obvious.

But then there are positive business drivers too. “We have worked with organisations who’ve found they save massive costs – between five to 10 per cent of IT budget – for example by discovering they only really need to pay for 60 licences of something, not 100,” says Rowlands.

“It stands to reason you will save cost if you know exactly who needs to use what,” adds Oliver Bendig, product manager at software firm Enteo which sells tools in this area. “It’s maybe one thing to have too many copies of Office, but something like Microsoft Project is quite expensive and it makes no sense to support instances you don’t need.”

So central has the issue become to good IT management that earlier this year a special new international standard, ISO 19770, was released to help firms comply with regulations and avoid spending on unnecessary software licences. Indeed there is a whole set of industry practices grown up to help avoid some of the pitfalls from poor asset control, in the form of various resources to help organisations oversee and control software, how to develop a software inventory, assess suppliers’ service-level agreements and manage assets throughout their lifecycle.

While all sorts of organisations can come unstuck, Bendig worries that non-profits in particular may be exposing themselves to danger. “I think they may be a little behind the curve as they have acquired licences and kit from all sorts of places and they may not be well understood or managed,” he says.

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This is certainly true for smaller organisations, but what may hold back charities more generally from doing a full scale IT audit is that it can be costly. It’s worth noting that there is no end of good software asset management tools out there: from IBM Tivoli and Remedy to products from CA to Centennial Discovery to Visionsoft’s Visual Audit X3 – and in August Microsoft is to release its own product in the area, the Software Asset Management (SAM) Customer Toolkit.

But, again, these can be expensive and they also aren’t the entire answer. “People forget the word ‘management’ is in there,” warns Rowlands. “A tool can’t read your licence agreement for you. This is a problem that needs to be owned by someone.”

Ultimately some form of IT audit and clean out of the licence stables has to be tackled by even the most risk-averse and cost-conscious organisation. Why? First off, there are simple operational inefficiencies that will keep cropping up, suggests Andes Loukianos, sales director of Touchstone, a UK IT services group active in the charity sector.

“The warning sign is where manual processes start cropping up to patch weak links between systems, and data is being transferred by anything other than automatic means,” he fears. This is a function of having systems being built up in a piecemeal fashion, with perhaps more than one database or accounting system, with little integration and thus not that much chance to achieve overall optimisation or other benefits of a scaled approach, he says. “Too many charities run these Heath Robinson IT infrastructures fraught with inefficiencies like that and in the end the creaking noises just get too loud.”

It’s a renewed focus on operational excellence that can be the biggest payback for such a process, adds Rowlands. “Many organisations are starting to look at things like service management and other forms of IT professionalisation such as ITIL (IT Infrastructure Library),” he continues. “But you have no hope of getting anywhere near there unless you have the right operating basis, which has to be a well-understood and efficient IT platform.”

Thus even if it does cost money, an IT ‘health check’ may be just what your organisation has been waiting for. Take Gingerbread, a charity dedicated to lone parent families in the UK (case study below). It struggled with a broken IT and communications system for too long, argues its chief executive Gwen Vaughan, who semi-jokingly talks of a BBC Changing Rooms level makeover: “Just like in the TV series, we have seen our old habitat completely refurbished and essentially replaced. But unlike some of the families in that show we are definitely over the moon with our new environment.”

The benefits of a re-tooling of IT are clear. “We now have a way to deliver better service to members, grow our business and finally manage growth. We all genuinely feel excited and are asking how much further and how soon can we go with this. We are going from administrating data to managing it – and we’re not always on the back foot all the time.”
Vaughan, as part of a strategic overhaul, had identified IT and infrastructure problems as a priority but had struggled to fill the gap with existing resources. But now all staff have new computers and a reliable network, they have been trained to appropriate skill levels in key Office and CRM applications, and the charity says it also benefiting from a new web site (www.gingerbread.org).

Admittedly, Gingerbread got there through the good fortune of a committed supplier, but surely the lesson is the same: fix your IT and your organisation can and will thank you for it.
Don’t, and you’ll waste money and even risk the long arm of the law – needlessly.

Case Study – Gingerbread

Gingerbread was set up in 1970, the charity’s remit being to deliver information and advice to the 2.3 million lone parents in the UK; a membership organisation, it currently has some 11,000 members after a period of rapid growth. But that growth has brought with it a range of problems resulting from a crippling lack of infrastructure. Its IT infrastructure was acquired in a haphazard fashion, and was supported mainly by volunteers. At its main London HQ the charity had two incompatible Apple Mac and PC networks, meaning information was often very difficult to share.

Staff had become frustrated at issues such as the lack of a link between the organisation’s web site and its membership database, leading to time-consuming manual re-entry of information. “We were hugely inefficient, having to switch between Excel and other software,” says its head of finance Bob Cooke. This lead to overly complicated project financing. head of membership Janice Leeming admits: “We were in permanent crisis management mode – always fire- fighting.” The charity received a major boost with a new IT hardware and software system donated by Microsoft and implemented by Touchstone that it says has boosted productivity and staff morale.

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