Valuable vs. fun: learning to love IT Asset Management

My attitude is that if you push me towards something that you think is a weakness, then I will turn that perceived weakness into a strength.

— Michael Jordan

As with so much in life, so it goes with IT: the parts that are fun aren’t always valuable, and the parts that are valuable aren’t always fun. Let’s talk about a hugely valuable side of IT that isn’t really much fun at all. And when it’s not fun, that means that it’s often neglected, and thus turns into a great weakness.

IT assets (hardware, software, systems, services) represent a major investment for most firms today. For “new economy” companies in particular, the cost of such resources (both bringing them on board and maintaining them as corporate assets) often exceeds expenditures in any area other than wages and benefits.

It’s astonishing, then, that firms (not to mention IT management specifically) don’t always embrace the ongoing hard work required to maximize the value of those expenditures and minimize the corporate risks involved. All too often, I see IT asset management (ITAM) neglected by IT executives because, well, it involves a discouraging amount of drudgery to do it right, especially over the long haul. This neglect occurs even more often when an executive succumbs to the latest faddish push for IT to focus on strategy and innovation to the detriment of fundamentals.

I noted this kind of flabbergasting inattention to asset management early in my career, when I was project manager for a firm (a publicly traded firm at that!) and arranged for the purchase of the first Unix workstation at that company, an investment of several tens of thousands of dollars. I asked how the item would be tagged and entered into the company’s asset management tracking, and was met with blank stares. There was no process. There was no tracking. One can only imagine the probable “leakage” that occurs when this is the case. Perceived drudgery (and perceived lack of importance/value) had resulted in a shoulder shrug attitude on asset tracking.

It’s a jungle out there

But the world is now a lot more complex. The best IT people, in my experience, learn to manage both the fun and the value portions of their jobs, even in cases where those two don’t overlap. And the “devil is in the details”, meaning that the opportunities on the value side run deep: in the realm of asset management, there’s far more than just hardware to think about. There are software licenses that may seem intangible but still represent substantial corporate assets, and there are high-dollar professional services contracts. And, of course, there are many different ways to purchase: leasing hardware as opposed to buying, for example. Usually, it’s not just money alone, but also long-term commitments that are in play. Given the high stakes, it behooves the senior IT professional to be well-versed in the pitfalls and edge cases for all of these.

All that is prologue to discussing a valuable resource that covers both a lot of the basics and many of the pitfalls in managing IT assets. A slim volume entitled Reducing Risk and Maximizing Investment Through IT Asset Management: A Practitioner’s Perspective, by Richard L. Allen, Jennifer D. Doyle, Tory M. Lehr, and William B. Fisher provides insight into several key areas of this overall topic, and does so (admirably) through a practitioner’s point of view. I found something on nearly every page that provided clarity and practical insight into numerous real-life situations that I have wrestled with at some point as an IT executive.

To illustrate just why I’m so interested in this topic, here are just a few nightmare asset management cases in point, taken from my personal school of hard knocks:

• The time I found out that years before, a certain database and applications vendor had sold my company numerous seats (“free!” — oh, ahem, except for the maintenance fee of 22% per year) for software we had never installed and had no plans to install any time soon;
• The time I discovered that my company’s entire production platform, deployed across hundreds of servers, incorporated a certain software driver for which we’d apparently purchased precisely one license, ever;
• Similarly, the time my company acquired another company, only to discover after the fact that they had bought just one copy of desktop productivity software, and installed it on every employee’s machine.

I could go on, but you get the idea. Each of those cases resulted from someone at the helm of IT not paying enough attention to the thorny details of IT asset management, and resolving each case caused a great impact (financial and otherwise) on the company. Do you like crises? Then just ignore IT asset management for a year or two.

A practical source of help

Each of those crises could likely have been averted had the IT executive followed the overall philosophy and specific tips contained in Reducing Risk and Maximizing Investment Through IT Asset Management. After a short introductory chapter covering overall concerns such as negotiation, vendor relationships, competition, etc., the bulk of the book delves into great detail on three areas: platform vendor and professional services, hardware leasing, and software license management.

I’ve been at this for many years, and I still garnered new insights, useful information, practical advice, and improved understanding of ITAM nuances. The section on leasing, for example, is mindnumbingly thorough on the details and pitfalls, while also providing the very accurate “big picture” foundational insight that “the leasing companies are in the business to make money off of companies who cannot purchase money as cheaply as they can… They also count on the lessees not being able to properly manage their leased assets.”

Through little fault of its own, the book isn’t exactly gripping, however, and I found myself frequently having to slow down and reread sections in order to fully absorb the many insights it contains. There’s clearly a natural limit to how much a dry topic like this will be able to keep any reader glued to the page. In fact, I was as susceptible to this “topic fatigue” as anyone, despite my substantial interest in the subject: I have had this book on my list to review for a year and a half, and have read it cover-to-cover, twice, in that time, yet still not managed (until now) to codify my thinking into a blog post.

Nonetheless, the book’s content is generally spot-on in its relevance and usefulness to the practicing IT executive, and it would be a serious mistake to pass it up simply because it promises to be a bit of a slog.  In fact, one of my favorite quotes from the book is when it dryly notes, about its own detailed explanations of leasing nuances, that “each item you skip over is a potential money making opportunity for the lessor.”

Room for growth

The interesting thing? This book could easily be five times its size. What it covers, it generally covers well, but I see it quite potentially as “release 1.0” in nature, since there’s so much more to the topic. I’d like to see additional in-depth sections on such things as specific asset management tools, with pros and cons; negotiation approaches; capacity planning. There’s a lot more to the ITAM story than can be fully covered in the current 138 pages.

Take, for example, just the relatively new topic of cloud resourcing, with such key wrinkles as spot pricing, reserved instances, and automatic scaling. As more and more companies move applications and development into the cloud, the potential for out-and-out waste escalates dramatically. You need to be on top of the issues, or the issues (and costs) will be on top of you like an avalanche.

Cloud or no cloud, though, let’s just state it flatly: Assets managed badly, or not at all, will cost your company significantly more than otherwise. This observation seems inarguable, yet once again, the necessary solution (detail-oriented management and tool selection) generally falls by the wayside. In the countless articles on ROI and IT, discussion of basic asset management, which can actually result in a significant ROI for the company, is unfortunately often neglected due to its lack of sex appeal compared to implementing new projects.

So the message? Focus on value over fun. This book can and will help you do that, in specific and practical ways. Be a Michael Jordan: work on the weaker parts of your game, and make them into a strength. You’ll actually find, over time, that strength is both valuable and fun.