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3 Ways an SMP Supports License Management for Office 365


3 Ways an SMP Supports License Management for Office 365

When Gartner released their final descriptions recently of the six main functional categories of a SaaS Management Platform (SMP), they gave extra attention to a critical area, license management. And there is a good reason for that, as you can see from an excerpt pulled from their report.

“SaaS vendors do not have the incentive to help customers spend less money on their software, so organizations should implement their own processes and tools to right size software spending.”
– Gartner New Market Guide for SaaS Management Platforms (SMPs)

After a company migrates to a SaaS platform, such as Office 365, it is their tally of licenses that equates to their associated software spend. Previous on-premises IT infrastructure costs are no longer a lever that can be squeezed in budget planning. Instead, each organization must now shift their cost-conscious focus to a more proactive control over license management.

Now that licenses are tracked and reported online to Microsoft, it benefits each organization to make sure they are only paying for licenses that are assigned and associated with active user accounts. There are three prescriptive ways that an SMP can help drive accountability for tracking license usage, and ensuring a company isn’t spending money on unnecessary licenses.

1) Assigning License Pools to Business Units

The first way is to assign ownership of a set number of licenses to each department or business unit by leveraging the SaaS Management Platform (SMP). These license pools will effectively delegate the responsibility for license distribution and recovery to the business unit managers and allow you to set hard limits on the number of licenses that a business unit can distribute. When they reach their full allotment of licenses, they won’t be able to take licenses from the general, corporate tenant account any longer. Instead they must purchase additional licenses from central IT, or more importantly, recycle inactive licenses from old user accounts under their license pool. This puts the central IT group in complete control over what licenses are distributed and who is paying for them.

These SMP license pool control mechanisms are extremely useful for large, distributed organizations, or government entities that have many different agencies. Once you have configured the license pools it is easy to promote the ownership to the different business units, or agencies, so they can maintain their independent subscription models. To enable this functionality, the CoreSuite solution provides license pools that can be configured for each different type of license combination.

2) Implementing Chargeback Accounting

The second method involves using your SMP to setup internal IT chargeback for distributed licenses. This can be a very effective model to promote responsible, fiscal accountability for license management at the department level. In recent years, IT chargeback systems have attracted more interest as a way to fairly distribute costs for IT services. And with the direct Office 365 license model assigned to individual accounts, it provides a straightforward one-to-one mapping for associated costs that can be billed to a business unit monthly

The simplest model to implement chargeback for Office 365 is to assign department billing codes to each user account and then cross-match the licenses utilized by those accounts. Then you just have to create an editable pricing table for the different types of licenses, and you’re in business. If a user switches to a new business unit they will have their billing code updated accordingly.

CoreSuite includes a complete set of integrated chargeback accounting features. Within CoreSuite you can easily track exactly what licenses are assigned and utilized. You can also configure any type of billing report you want and categorize it by business unit, geographic location, or whatever you wish. These billing reports can be setup to run on a regular basis and you can automatically send them to the department managers to keep them informed of their chargeback commitments. These reports can easily be exported and made available for corporate billing systems to process.

3) Recovering Licenses from Inactive Accounts

By accurately monitoring user activity in Office 365 and identifying inactive accounts through a prescriptive process, those registered Office 365 licenses can be reclaimed and repurposed to new employees as needed. This process should be performed consistently, and notifications sent to the department leaders who are responsible for cleaning up those inactive user accounts.

To assist customers with this type of reporting and correlation between licensing and user activity, CoreSuite provides a specific interactive dashboard. The Consumption Dashboard report, as shown in the screenshot below, empowers organizations to quickly identify inactive accounts across all Office 365 workloads by business unit, department, or geographic location.

Example: Consumption Dashboard Showing Inactive Accounts and Associated Costs

Final Thoughts on License Management Using an SMP

License Management is one of the most important categories for a SaaS Management Platform (SMP). The Microsoft admin center portal was not built for proactive license management purposes. It requires an enormous amount of development effort to create an effective license management system for Office 365 using PowerShell scripts and custom spreadsheets, not to mention the countless hours to perform the processing cycles each month. Today, CoreView is the only SMP solution for Office 365 that can help organizations perform proactive license management. And a bonus for multi-national organizations, the CoreView interface is easily configurable in multiple languages to accommodate different admin teams from around the world.

If you are interested in finding out more about CoreView’s SaaS Management Platform (SMP) and how it can help you optimize license management for your Office 365 environment, please reach out to us at and we will setup a custom demo.

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