What is Software Asset Management (SAM) and Why Your Organization Needs It

By Michael • 4 mins read

Table of contents

Software is one of the most significant investments organizations make. Yet, without structure and discipline, software costs can spiral, risks can multiply, and vendors can use audits as leverage to extract more money from you. This is where Software Asset Management (SAM) becomes essential.

According to ITIL, SAM is defined as:

“All of the infrastructure and processes necessary for the effective management, control and protection of the software assets within an organization, throughout all stages of their lifecycle.”

In other words, SAM isn’t just about license compliance or surviving an audit. It’s about risk mitigation, cost reduction, and enabling IT to function as a strategic partner to the business.

Why Software Asset Management Matters

SAM has evolved far beyond being a checkbox for compliance. Gartner notes that organizations practicing SAM as a discipline typically achieve:

30% cost savings in the first year of implementation
5% ongoing savings annually for at least five years afterward

Given that software and hardware spending often accounts for 20% of IT budgets, these numbers highlight why SAM isn’t optional—it’s critical.

The risks are also increasing. Gartner surveys reveal that 65% of organizations reported at least one software audit in the past year. Audits are on the rise, and they’re not about ensuring compliance—they’re negotiation tactics to push companies into paying more.

Without a clear SAM strategy, organizations face:

Legal and financial liabilities
Reputational damage
Overpayment for unused or underutilized software
Disruptive, time-consuming audits

Key Benefits of Software Asset Management

1. Reduce Risk

SAM helps organizations identify license gaps, prevent fraud or misuse, and avoid unsupported software that introduces security vulnerabilities. It also reduces compliance exposure—ensuring you’re always prepared for an audit.

2. Reduce Spend

Rather than buying new licenses every time an employee requests software, SAM allows you to reallocate unused licenses. It curbs shadow IT purchases and ensures you only buy what you truly need.

3. Maximize Investments

Organizations spend heavily on software but often underutilize what they’ve purchased. By surveying usage and tying licenses to business needs, SAM ensures you get full value from existing investments.

4. Negotiate with Confidence

When you know exactly what software you have, what’s being used, and what isn’t, you gain leverage. Instead of blindly entering multi-year agreements, you can negotiate contracts that align with real business needs and adjust annually as usage evolves.

The Reality of Software Audits

A software publisher audit is rarely just about compliance—it’s a sophisticated sales tactic. The publisher asks you to report your usage, consuming weeks of man-hours and disrupting business operations.

With SAM, you can streamline audits by having accurate, up-to-date records:

What licenses you own
When they were purchased and renewed
How they’re being used across the business

Best practices include:

Identifying your key software publishers and tracking contractual renewal dates
Training staff to escalate any audit notices immediately
Involving IT legal to validate audit rights before responding
Establishing a standardized internal audit response process

A well-prepared organization avoids unnecessary costs, reduces disruption, and maintains control of the negotiation.

Understanding the Software Asset Lifecycle

Effective SAM covers the entire lifecycle of software, from request to retirement:

Request – Users browse a catalog of approved software and submit requests.
Approval – Managers or procurement evaluate licensing requirements and budgets.
Procurement – Check for available licenses before purchasing new ones. Reftab can surface unused licenses or underutilized seats for redeployment.
Provisioning – Software is deployed, whether by assigning a license in a portal or installing it on infrastructure.
Monitoring – Track usage, survey users, and integrate with HR processes to reclaim licenses when employees leave.
Deprovisioning – Revoke or uninstall licenses to ensure compliance and free up resources.

This cycle creates a repeatable, disciplined process that saves money, reduces risk, and improves IT responsiveness.

The Role of Application Owners

An often-overlooked aspect of SAM is assigning application owners. These individuals understand the business use cases for specific applications and work with IT to verify usage trends, assess risks, and identify optimization opportunities.

For example, IT may surface a report showing declining license usage over three quarters. The application owner can confirm whether this reflects a real business change or if licenses need reallocation. This partnership ensures decisions are accurate, timely, and strategically aligned.

SAM as a Strategic Discipline

SAM is not a one-time project. It’s an ongoing discipline that requires:

Executive sponsorship and governance
Cross-department collaboration (IT, procurement, legal, security)
A reliable platform like Reftab to track, monitor, and optimize licenses

Organizations that embrace SAM don’t just save money—they become more agile, reduce audit risk, and optimize how technology supports the business.

At its core, SAM enables IT to shift from “keeping the lights on” to being a strategic partner driving business growth.

How Reftab Makes SAM Simple

At Reftab, we’ve built our platform with SAM at the center. Here’s how we make the process easier and more effective for IT teams:

Software + License Tracking – Reftab groups licenses into applications so you can see the complete picture of what software your organization owns, who’s using it, and where licenses are underutilized.
Audit-Ready Visibility – Be prepared for vendor audits at any time with clear records of license ownership, renewal dates, and real-world usage.
Usage-Based Insights – By connecting Reftab to your SSO system, you can track logins and verify if software is truly being used. Automated surveys make it simple to confirm business need directly with end-users.
Streamlined Lifecycle Management – From request and approval to provisioning and deprovisioning, Reftab gives you visibility and control across the entire software lifecycle.
License Optimization – Reuse existing licenses before buying more, and confidently reduce spend by aligning purchases with actual needs.
Cross-Team Collaboration – Reftab bridges the gap between IT, procurement, HR, and finance, ensuring no license is overlooked when employees leave or projects change.

In short, Reftab turns SAM from a complex, manual process into a repeatable, automated discipline that saves money, reduces risk, and gives IT leaders the data they need to negotiate from a position of strength.

✅ Bottom line: Software is too important—and too expensive—to manage haphazardly. With Reftab powering your SAM strategy, you gain control, cut costs, and strengthen your negotiating position—so your organization can focus on growth, not audits.