Controlling nondiscretionary spending is a perennial top priority for IT, and the cost of software licensing, operations and maintenance is a particularly sore topic. In our InformationWeek 2012 Enterprise Applications Survey, we asked respondents to rate their satisfaction with nine aspects of on-premises enterprise application technologies. Ongoing maintenance and support came in dead last; initial cost didn't fare much better.

We often see clients surprised by (sometimes substantial) unplanned costs, whether from new licenses to support last-minute projects, vendor changes to licensing metrics or maintenance on legacy platforms. Another problem is a discrepancy between your software licenses and what's actually in use. In our experience, these inconsistencies are driven by factors ranging from inadequate asset management to isolated procurement practices that limit enterprise-wide visibility.

When it comes to something as expensive and complex as software licensing, transparency is critical. Software maintenance is a key revenue stream for large software vendors -- Forrester says recurring maintenance fees can account for nearly 50% of most application vendors' total revenues, and that's growing by 10% annually, so they are being increasingly vigilant in gathering every bit of revenue from in-service agreements.

While we see some interest in dropping a primary software vendor in favor of getting support from a third-party provider such as Spinnaker Support or Rimini Street, we don't recommend that path until these providers mature a bit more. For now, you'll do better by effectively managing maintenance contracts with your primary software providers. To do that, we recommend 12 steps, which fall into two broad areas: getting advantageous terms and tightly managing licensing. (We delve into these in more depth in our full report.)

Terms And Conditions