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Explore the Secrets of IBM Software Contracts to Optimize Spend and Reduce Compliance Risk

Learn the essential steps to avoid overspending or failing an IBM audit.

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  • Brian Gross, Canyon Consulting Inc., New York, NY
  • Bruno Pistillo, Manager, Enterprise System Products I&T Division, City of Toronto
  • IBM customers want to make effective use of their paid-up licenses to avoid overspending and stay compliant with agreements.
  • Each IBM software product is subject to different rules.
  • Clients control and have responsibility for aligning usage and payments. Over time, the usage of the software may be out of sync with what the client has paid for, resulting in either overspending or violation of the licensing agreement.
  • IBM audits software usage in order to generate revenue from non-compliant customers.

Our Advice

Critical Insight

  • You have a lot of work to do if you haven’t been paying attention to your IBM software.
  • Focus on needs first. Conduct and document a thorough requirements assessment. Well-documented needs will be your core asset in negotiation.
  • Know what’s in IBM’s terms and conditions. Failure to understand these can lead to major penalties after an audit.
  • Review your agreements and entitlements quarterly. IBM may have changed the rules, and you have almost certainly changed your usage.

Impact and Result

  • Establish clear licensing requirements.
  • Maintain an effective process for managing your IBM license usage and compliance.
  • Identify any cost-reduction opportunities.
  • Prepare for penalty-free IBM audits.

Research & Tools

Start here – read the Executive Brief

Read this Executive Brief to understand why you need to invest effort in managing usage and licensing of your IBM software.

1. Review terms and conditions for your IT contract

Use Info-Tech’s licensing best practices to avoid the common mistakes of overspending on IBM licensing or failing an IBM audit.

Guided Implementations

This guided implementation is a six call advisory process.

Guided Implementation #1 - Managing IBM contracts

Call #1 - Engage in a scoping call
Call #2 - Assess and improve statement of recordkeeping
Call #3 - Improve IBM contract negotiation

Guided Implementation #2 - Responding to an imminent audit from IBM

Call #1 - Get ready for an imminent audit
Call #2 - Review IBM draft audit for possible improvements
Call #3 - Develop a plan to avoid negative audit results

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