The pricing of most Microsoft 365 (M365) and Office 365 (O365) suites will be increasing on March 1, 2022. The increases will be applied to all Microsoft clients on direct (EA, EAS, SCE) and indirect (CSP, MPSA) programs at renewal. If your organization is licensed for any of these suites, it's important to understand the impact to your organization, as these increases are inevitable and unavoidable. What steps can be taken to minimize impact? Before you can understand the impact of the cost increase, you need to have visibility into your organizations purchases and use of all the Microsoft Office 365 licenses.
Conduct an assessment
Having a tool to conduct an assessment is the first step toward reducing cost and getting Microsoft 365 license management under control. A common theme for companies is that Microsoft 365 licensing is complex, constantly changing and not very flexible. The sheer number of products and features often makes it difficult to know what is in the chosen subscription. Microsoft 365 implements about 500 features per year, forcing companies to align these detailed features with the business needs, and understand how their users will use these features. To avoid overspending, it is important to figure out who gets what license based on their business needs and to avoid overhead. Companies and their administrators must decide what license to apply based on the tools the user needs to perform their job functions.
Often this task of purchasing, managing, and applying the license falls on the administrators. Unfortunately, these administrators are often too busy, not given an easy solution, or overwhelmed by the task of having to come up with a custom solution. Management of a very complex Office 365 environment can be difficult. Often administrators feel overwhelmed, managing a system with multiple portals and interfaces. This often results in the administrators not aligning with business needs or adopting to changes in the business, resulting in a lot of licensing overhead and additional costs to the company.
What do I do with all this information?
Evaluate the impact and be prepared to lock in pricing (known as an "early commit") with an early renewal date. There are multiple options depending on your organizations requirements and the results of the assessment. Determine the candidates for license reductions, such as users no longer within your organization. Determine all the candidates for license downgrades, those who have features enabled that they do not use. This is also a good time to consider moving to higher SKUs now that the price gap between the SKUs is decreasing.
How can this help me moving forward?
Microsoft 365 license management isn't just useful for determining the impact of this cost increase, it can help with costs and overhead and should be part of your ongoing License Management Lifecycle. The complexity and ever going changes to Office 365 are most likely to continue into the foreseeable future. Once your company has adopted Microsoft 365, these challenges are likely to grow. Companies need to be prepared for challenges such as mergers, acquisitions and divestitures, on-premises-to-cloud and tenant-to-tenant migrations, as well as the need for external collaboration with partners and vendors.
Of these, M&A activities can be especially challenging. Often migrations can be so complex, that licenses and license management can be overlooked. Determining and acquiring the correct number and type of license is critical to the overall success of the project and end user experience during the project. Without insight into the source and target Office 365 tenant licenses, the project could be jeopardized. Common issues include:
- Running out of licenses during a scheduled migration event. This most likely will lead to the migration event failing or leading to the user not being able to access features post migration.
- Purchasing the incorrect license type for the target user, leading to either missing features or overpaying for features not needed.
The goal is to ensure your organization has the insights necessary to be successful in your immediate project as well as for future needs. Also, it’s critical to provide your administrators with the tools they need to manage and understand licensing, helping them overcome the complexity that comes with license management.
So, what can a company do to overcome these challenges?
One option is to rely on offerings such as the Quest® Microsoft Cloud License Assessment. This free assessment leverages the cloud-platform Quest On Demand License Management to generate insights detailing the current inventory of licenses, product and services entitlements, the utilization of licenses throughout your enterprise, and much more. An experienced consultant will review the findings with your organization and help identify opportunities for optimization. The assessment will help ensure your company is buying the correct number and the correct types of licenses. This will help administrators understand the requirements of the users as well as the number of active users that need licenses. It will help align licensing with your provisioning and deprovisioning process and make sure you aren't paying for licenses for inactive users and prevent paying for unnecessary features and add-ons that the user doesn't need or never uses.
Another option is to invest in a solution to assist with License Management and Assessment. Tools like Quest® On Demand License Management can help administrators with assessing and reporting on Microsoft 365 license use, gain insight to the complex and overwhelming task of license management and take the first step in understanding the impact of this and any future cost increases.