Comprehensive Spending Review Points The Way For Massive Departmental Savings

The Comprehensive Spending Review, launched yesterday by Chancellor George Osborne, contains the deepest cuts in public spending in living memory, with the majority of government departments expected to make substantial efficiency savings over the next four years.

Government departments are now being asked to deliver enormous efficiency and administration savings ranging from 7.1% per year at the Department of Business, Innovation and Skills, through to a staggering 41% reduction in costs at the Department for Culture, Media and Sports.

Effective management of software assets by public sector organisations improves financial performance by addressing such issues as how acquisition should be affected by utilisation and disposal. Software, like any other asset, must be managed throughout its lifecycle to achieve its maximum potential benefit and this is one lesson that government departments are going to have to go through if they are to achieve the level of efficiency savings the Chancellor has demanded.

Research conducted by IDC on behalf of the SIRB, into the exploration of ‘Board / Non-Board views on the Methods of Achieving Savings’ has given us a unique insight into the challenges that public sector organisations now face as they try and identify substantial budget savings.

Among the ‘Non-Board’ (for which, read mainly IT and Financial management) respondents, the single most cited way of saving costs was via ‘reduced software procurement costs’, with 60%. However, the board saw things differently, with just 31% citing the above reason while 21% and 22% opted for ‘alternative models for licensing’ and ‘reduced non-compliance risks’ respectively.

It doesn’t take a lot of reading between the lines to realise that the above three priorities should all ultimately lead to the same effect on the bottom line – cost savings through better use of licenses, available assets etc. But it’s also easy to see why a disconnect can occur when different stakeholders use different language.

John Lovelock, chief executive of FAST IiS added: “Any one government department may be using thousands of computers, based across the country in a mixture of centralised and remote locations, running numerous versions of operating systems and applications residing in data centres and distributed environments alike. Given the highly dispersed nature of many government departments that is an additional reason to manage software – control and compliance.

Software Asset Management (SAM) should not be viewed as an optional administrative process but a key mechanism for transforming software from a cost centre to a strategic asset. For the public sector struggling with budget cuts it can deliver a number of benefits including controlling costs associated with software assets, improving the performance of those assets as well as the organisation and its employees and compliance with the law.

Matt Fisher is a director of the ITAM division at FrontRange Solutions and is the current chairman of the Software Industry Research Board (SIRB), a group of software vendors and practitioners dedicated to promoting better software management practices in the UK. Matt has been closely involved with the IT asset management arena for more than six years, championing the benefits that organisations can realise through Software Asset Management (SAM).