IT asset management has bedeviled CIOs and CFOs for years. The infamous "black box" of IT spending has kept most CFOs and CIOs from truly understanding what their technology budgets buy.
From a technology perspective, tracking IT assets should not be that difficult.
Network monitoring and cybersecurity tools can tell when a device connects or disconnects from a corporate network. Software vendors can uncover the total number of licenses in use, and automated asset discovery tools can scan for equipment unseen by IT.
If the use of personal devices is prohibited, all of these efforts are made that much easier since every purchase should go through procurement or the accounting department. And, if a CIO lacks the in-house resources, most of these services can be obtained through a managed service provider.
For Rob Zahn, CIO of AAA of Ohio — who manages a small data center and over 500 corporate-owned devices spread out over 34 regional offices plus a fleet of service vehicles — all of these approaches apply, as well as using standard images on new machines and conducting yearly security audits.
When Microsoft Windows NT was still around, the first version of which was released in 1993, AAA of Ohio conducted an audit looking for deployments of the operating system. "We thought, 'Nah, we don't have any NT PCs or anything around'," he said. "And sure enough, after Microsoft did that first scan, we found an NT PC."
There is no certainty, "but I feel very good about where we are at and what our assets are and how we track them," he said.
Not all CIOs are in as good a position as Zahn, said Sandi Conrad, an infrastructure and operations analyst at Info-Tech Research Group. Just 64% of respondents have effective asset management programs in place, based on a InfoTech survey slated set for publication later this quarter.
Cultural and technical hurdles
If asset management is one of the easier, more mundane, and process-centric IT activities, why is it so hard to do well? The answer is complicated, said Carlos Casanova, a principal analyst covering networking and AIOps at Forrester.
Part of the reason is cultural. Organizations just don't put forth the needed effort or have the tools to do the job right – even though 83% of respondents to Info-Tech's survey rated asset management as "important," said Conrad.
ITAM "is often underfunded and, especially in small and mid-sized companies, may be done on the side of the desk by a technician while supporting technical services," she said.
Another involves hoarding. Managers who do not want to deal with IT or procurement headaches will hold onto unused licenses and hardware just in case they are needed in the future.
A third is skeletons. CIOs will sometimes keep numbers for certain assets like servers artificially high during the year to maintain a certain level of staffing, for example. But, at year end, when they reconcile the books with the CFO, the numbers can change pretty dramatically.
"I had a CIO once say, 'Our IT department is absolutely amazing at year end, when it needs to reconcile against the finance and their budget'," Casanova said. "During the year, they've got more devices than they could ever imagine."
The adoption of cloud and the shifting of spend from CapEx to OpEx is also complicating asset management efforts, said Aashish Chandarana, CIO of Productiv.
"We are at a turning point in the industry as a whole," he said. "The clue is in the name. We still think of 'software assets'. That made sense when a perpetual license sat on a company’s books as an asset but, in reality, software is no longer tied to hardware, hardware is no longer tied to networks, and privileged access on networks isn’t a modern approach."
Impact on spending and budgeting
Of course, all of these issues can impact the ability of the CIO and the CFO to put together accurate budgets and adjust spending to meet the organization's needs.
For many CIOs and CFOs budgeting is an exercise in reconciliation.
Because of the different approaches and tools in use to track assets, as well as the types of assets being tracked, CIOs and CFOs have to spend considerable amounts of time coming up with a single version of the truth.
If not done well, this process can create as many blind spots as it cures, said Casanova.
For example, a qualified cloud administrator can cost an organization $180,000 plus benefits per year. If these costs are not included in the cost associated with moving to cloud, then the true, all-in cost of that move will at best be obscured and could throw off budget calculations going forward.
In many instances, however, it is the outdated methods and technology being employed that drive most of the ITAM problems, said Casanova. There are multibillion-dollar, international companies today that are running asset management like they did two-decades ago using spreadsheets.
"I've seen organizations where they fill out the PO after the piece of equipment came in," said Casanova. "How does that CFO have good insights? How can they make informed decisions? It's garbage in, garbage out."