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4 Ways to Use Business Intelligence to Optimize License Management for Office 365


4 Ways to Use Business Intelligence to Optimize License Management for Office 365

The early days of software licensing management were full of extremely complex functions, including lots of fine print in multi-year enterprise agreements. There were even Software Asset Management (SAM) tools to help organizations make sense of all the licenses they owned. But when we started moving everything to the cloud it was supposed to get easier since you only have to pay for what you actually use, right? Sounds simple, but in reality, it isn’t. The responsibility is now squarely on every company’s IT group to track usage accurately, re-harvest inactive account licenses, and guard against being oversubscribed; read as over-paying.

Office 365 is an example of a subscription-based, cloud service; you pay for what you need and nothing more. But are there best practices to follow so you don’t become oversubscribed? We were curious about how our enterprise customers were doing with managing their license subscriptions, so we went out and asked them recently. Indeed, there are some best practices that we uncovered. You may find these helpful if you’re trying to reduce your licensing costs for Office 365. It turns out that our customers were applying business intelligence (BI) reporting using the data gathered from CoreView to better manage their licensing. Here are the four common activities and reporting areas where our customers found cost savings through BI licensing optimization.

1) Closely monitor and track inactive accounts so those licenses can be reclaimed and repurposed
2) Don’t assign licenses to accounts that don’t need one
3) Identify accounts with overlapping (redundant) license features and remove them
4) Downgrade license packages for users that aren’t actually using the additional workloads

Identifying Inactive Accounts for Repurposing Licenses

There are different reasons why user accounts become inactive, but the most common is when interns, employees or consultants leave the company. If HR processes are not tightly linked to the corporate directory and Office 365, then those user accounts will remain intact, and so will the assigned licenses, even though the HR account entries are disabled. By accurately monitoring user activity in Office 365 and identifying inactive accounts, those registered Office 365 licenses can be reclaimed and repurposed to new employees as needed. At the end of the day this process has saved quite a bit of money for our customers as new licenses didn’t need to be purchased.

An organization that engages this type of viable inventory management model for Office 365 licenses will require minimal overhead of excess licenses since new ones can be acquired quickly from Microsoft as needed. Our customers reported that they keep a small buffer of 2% to 4% of additional licenses on hand just in case they have an immediate need. And two of our largest customers also described their plans to create a scheduled workflow process to identify inactive accounts, request approval to shut them down, and then automatically pull back those licenses for repurposing. This process will utilize the new workflow engine that just became available in CoreView.

Removing Unnecessary Licenses from Accounts

Another best practice is to create a specialized BI report to identify accounts that were assigned licenses unnecessarily. These are accounts such as “Service Accounts”, or “Shared Mailboxes” that don’t require a license. Applying the specific business intelligence process to perform a weekly query for those type of accounts with assigned licenses triggers the creation of a red-flag report in CoreView. This report is sent to the Office 365 licensing administrator so they can remediate the issue and remove the licenses so they would be available in the general inventory. One of the customers we talked with said they initially found over 100 of these types of licensed accounts that were recovered.

Identifying Overlapping License Features for Removal

This next BI report requires some background research to determine the overlapping features that are available in different licensing packages, or SKU’s, from Microsoft. But it is well worth the effort due to the cost savings in the end. For instance, if a user is assigned an Office 365 E3 license, they do not require an additional license for ProPlus, because it’s already included within the E3 license. There would be an additional, unnecessary cost applied to this account if they had the ProPlus license assigned.

You can see from the example screenshot below, which includes one user who was part of the overlapping license report. This user had two SKUs applied for security – Enterprise Mobility + Security E3, as well as the same for E5. These overlapping licenses incur unnecessary costs. One of our customers reported saving almost $90,000 by creating this report and removing the overlapping licenses. They now run this report weekly to make sure any occurrences of overlapping licenses are fixed right away.

Example: Overlapping License Features Causing Add-on Costs

Downgrading Licenses for Users Who Don’t Require Additional Capabilities

The last of the license management best practices involves monitoring and cataloging user activity by Office 365 workload, and then associating the assigned license types based on what workloads are available to each user. For instance, if a user is assigned an Office 365 E3 license, which gives them access to utilize the advanced workloads in Office 365, such as Skype for Business, SharePoint and OneDrive, but in actuality they are only using the very basic features in Office 365, then they can get by with an E1 license instead. The cost difference between an E3 and an E1 is significant, which is why this type of BI reporting was very valuable to the customers we talked with recently.

This enabled the organizations to identify the users who were “over-licensed” and implement a training and adoption campaign to drive up the usage of the other workloads. For those users who still didn’t show any activity in the other workloads they were switched to the less expensive license type. One of the customers we spoke with said that they were able to downgrade almost 1,500 users to the lower cost license SKU after two months.

To assist customers with this type of BI research and analysis of the correlations between licensing and user activity, there is a new interactive report available within CoreView. The License Optimization Report, as shown in the screenshot below, empowers organizations to quickly filter the lists of users based on their assigned licenses, office location, department, etc., along with the activity groupings by workload. This helps IT admins quickly identify users that require additional training or incentives to use the workloads they’re enabled with, or downgrade their licenses as needed.

Example: License Optimization Report by Office Location

Final Thoughts on Optimizing License Management

IT organizations now find themselves supporting a mix of Office 365 licensing plans including version bundles that offer different add-ons to enable or disable as needed. As a result, challenges with proper distribution of licenses, monitoring inactive accounts, accurate internal chargeback procedures, and overlapping license updates arise continuously. For organizations that want to be more proactive in managing their licenses, and maintain a tight-fisted fiscal model relating to over-subscriptions, then they need a more robust management solution like CoreView to help them.

License Management is now one of the six categories for a SaaS Management Platform (SMP) that Gartner documented recently. Today, CoreView is the only SaaS Management Platform (SMP) solution for Office 365 that can help organizations perform proactive license management using business intelligence reporting. 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 customized demo.

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