Summary: You do not necessarily need to change your current Asset Management Software to reduce costs. Reducing costs also doesn’t mean that you have to compromise on the quality of your software either.
Procurement teams have a tough job, as they’re often asked to reduce spending on software. Even if they are not asked, the initiative of leading procurement teams is to always find ways to reduce spending.
Almost every procurement team is looking to reduce spending with limited operational and functional details of an asset management system. So they’re almost exclusively focused on looking at numbers.
In this guide, we reveal the techniques and principles to reduce costs without compromising on your quality. Which may help you to become a more tech-savvy buyer.
Find Asset Management Software That Matches Your Budget
What Type of Assets Are You Looking to Manage?
Explore Avenues to Optimise Your Asset Management System Usage
There are two principal costs associated with Asset Management Software:
- Usage Costs
- Software Costs
Most procurement teams focus on software costs, quite often ignoring or not fully optimising their usage costs. Usage costs typically make up around 50% of overall costs.
Below are the 4 key components of usage costs and the framework for reducing each one:
- Number of users
- Software features
- Data
- Hosting costs
1. Number of Users
- You can see activity by users to identify heavy users, moderate users, light users, and users with a login who do not access the software.
- The above report will get you the data necessary to remove users who are not using the system.
- Engage with light users to fully understand how they use the system and explore avenues to offer read-only data (which often does not consume user licenses).
The above steps typically help to reduce numbers by 5 to 20%. This directly saves per-user software costs.
2. Software Features
- Analyse the plan that you have bought. Typically you will see a plan like this one (below), where you will pay for more features.
- Book a one-to-one meeting with key heavy users and explore if you can dial back/scale down on the plan. Quite often there are avenues to reduce costs by 40% or so if you scale back the plan.
- Please note scale backs can often only happen during renewals. If you are planning to renew your Asset Management Software, we have outlined 4 aspects that might be useful.
3. Data Within Your Software
- Look at the overall size of the data and explore if you can back up/archive documents, images, and information that is more than 10MB.
- Create protocols on data size. Quite often users add high-resolution images and PDFs that are not optimised for size. Having optimised-sized data will mean you need less space, which means saving on data consumption costs.
- You can expect 3 to 7% cost savings here.
4. Hosting of Your Software
- Explore if you are on a private cloud.
- There are typically opportunities to reduce hosting costs if you move to a hybrid cloud whereby you can put business-critical data in a private cloud and generic data in a public cloud, which is a cheaper solution.
Can Your Asset Management Software Be Reimplemented With a Simplified Setup?
Once you review users and the features plan of your asset system, it’s likely you’ll conclude that your asset management system setup is too complex. We recommend validating the system setup hypothesis with your heavy users.
If you find the setup is complex, then explore reimplementation costs. Typically, you can simplify the setup in a week. Quite often it takes drawing up your asset processes and agreeing on simplified navigation within the system. This involves taking off custom fields and eliminating agreed steps/processes.
A simple setup is cost-effective and usage-friendly, so you will get more than a cost advantage.
Use Our Asset Management Software Finder to Identify the Best Tool For You
What Type of Assets Are You Looking to Manage?
Don’t Compromise On Security For Cheap Gains
Asset Management Software vendors spend a fair amount of capital on SOC2 certifications and securing their software. Secure coding and making the software penetration free is both expensive and a rare skill set.
If your software is connected to a data historian that picks data from your equipment and sensors, then it is even more important to be cyber-safe.
Hence, overlooking any cybersecurity aspect shouldn’t be an option when looking to reduce costs.
Take a One-System Approach, What Other Tools Have Asset Management Capabilities?
Most software vendors offer one platform for all your requirements. It means there could well be asset management capabilities in the other software systems that you may have. The idea is to have one system instead of two systems.
Keep in mind, though, that this approach can have a downside. A one-system approach is often like a swiss knife; it can do a lot of things but not one thing really well.
If asset management is core to your business, then a one-system approach may not work for you.
Recover Software Costs Using R&D Tax Credits
You may be eligible to recover some software costs if you are using software for research and development purposes.
The techniques above have worked for several Asset Management Software buyers who have used Comparesoft, so we are positive they will bring greater cost-effectiveness to your business.