Software license compliance: 9 best practices you must know


Subscribe to our blog


Software license compliance is crucial to ensure that the use of licensed software tools doesn’t go beyond the scope of license agreements. These agreements specify the rights and responsibilities of the licensor (the owner of the rights to the software or intellectual property) as well as the licensee (the party who has been authorized to use the software or intellectual property).

Wondering what are these rights and responsibilities? Notably, these may include places and the ways the license material can be used, the validity of the license, and whether one has to bear penalties for breaching compliance.

When it comes to concurrent licenses, a specified number of users, devices, and servers are given access to individual software tools. This limitation of access is controlled by license compliance.

What are the possible risks of non-compliance?

If an organization fails to comply with software licensing terms and conditions, that can lead to adverse consequences such as fines as well as legal actions. Such situations can severely impact the reputation of an organization.

There are a number of instances of companies using unlicensed software that have led to penalties and legal actions, largely affecting their reputation and relationship with customers. For example, in 2021, two Kansas-based organizations were sanctioned in two separate court cases for using unlicensed versions of the software CATIA. Both companies had to pay approximately $75,000 including fines and restitution charges to Dassault Systèmes, the owner of CATIA.

To avoid such situations, it’s prudent to adhere to the following benchmarks in order to ensure software license compliance.

Software license compliance best practices: 9 boxes to tick

Understand the licensing terms and conditions

This is the fundamental step to ensure software license compliance. Apart from understanding the terms and conditions of the software license, make sure to have a solid grasp on the rights and responsibilities of the licensor and licensee, as well as the penalties for non-compliance.

Make the most out of your software licenses

It is crucial to optimize your licenses to ensure a decent ROI. Unutilized licenses indicate a failure to use what you have paid for, highlighting inefficient license management.

Maintain comprehensive records

Having accurate records of all software tools in your server is crucial. Otherwise, you may be at risk of facing a software license compliance audit.

Conduct internal software license compliance audits regularly

A license compliance audit is a review of software assets where it is checked whether licenses bought comply with the vendor’s terms and conditions. It is crucial to conduct frequent internal audits so that you can identify any software license compliance issues without delay and take appropriate actions to resolve them.

Notably, running an internal audit doesn’t mean your organization is non-compliant, as this is a popular practice among major companies to avoid possible software license compliance violations. This also helps organizations be better prepared for external audit requests.

Educate employees about license compliance

It is important to conduct regular training sessions, workshops, and webinars to make employees aware of the software license compliance best practices. Also, make sure to keep your employees updated about any changes in the terms and conditions of license agreements.

Set up a dedicated compliance team

If your organization works with a high number of software licenses, it is prudent to have a dedicated team to monitor software license compliance. The team can look after the following:

  • Decoding licensing terms to the members of other teams
  • Supervising the implementation of the license management system
  • Conducting regular training sessions and internal audits

Keep your software licenses updated

To avoid any license compliance issues, it is crucial that you use the updated versions of all software licenses. With this practice, you can avoid external audits and save on additional expenses.

Integrate your system with a software license monitoring solution

If your organization is dealing with a high number of paid software licenses, it is always advisable to set up a license monitoring system to get more visibility into the software license usage. Make sure to go for a license monitoring solution that supports a large number of license managers, and has features such as idle time monitoring and license harvesting. This ensures that you can track all types of licenses, and can also optimize them as required.

Notably, among all the license monitoring solutions, OpenLM supports the highest number of license managers (more than 75). We also offer integration with major SAM platforms such as ServiceNow and License Dashboard, so you can leverage OpenLM functionalities if you are using any of these tools. OpenLM integrates all records regarding your software licenses through a common interface for the license servers, license files, and options files. We welcome you to join our obligation-free 30-day trial and experience the best functionalities of software license monitoring.

Utilizing these software license compliance measures can help minimize your license usage, leading to reduced expenses and ensuring preparedness for unexpected software license compliance audits. If you have additional inquiries about software license compliance or the integration of SLM-SAM, feel free to reach out.

Leave a Reply

Your email address will not be published. Required fields are marked *

Skip to content