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A Better Way to Manage Office 365 Licence Charge-backs

Aug 23, 2016 by Emma Robinson

IT has undergone a rapid transformation in the past few years as services and software move into the cloud, and the impacts of this are being felt beyond the IT industry – especially when it comes to managing IT costs and spending.
For many organisations, long gone are the days when you research, select, and invest heavily in servers, with the knowledge that the process will not be repeated for a good few years. Typically, your team would make infrequent purchases for hardware or software at a significant cost, and then when it comes to sharing the costs across the entire business, a common practice would be allocating the spend based on a per-user basis for each department, based on size. The bill is calculated, and sent to each team, so that their IT costs can be deducted from their budget.
Other models for IT charge-backs also proliferate, some calculate the cost based on usage, profitability or needs of the various teams, but all schemes aim to spread the cost of IT across the entire business in a way that is fair and proportionate. The process requires time, consideration, and an accurate view of how your business units are interacting with IT systems.
Managing Office 365 Licence Costs
If your company is in the cloud, you will know that billing structures are typically more frequent (monthly, quarterly), and while the cloud promises more flexibility to scale up and scale down costs based on user numbers and usage needs, it can often make charge-backs far more difficult to manage. This CIO article sums it up perfectly: ‘Let’s face it: Your department is a cost center without a revenue stream to offset your cost structure.’ So how do you go about analysing your spend and allocating the costs accurately?
When it comes to Office 365 licences, the bill goes to IT every month, usually to the Office 365 Global Admin, or the Billing Admin (if your organisation has one). It might be the responsibility of the IT team to deal with this, or your finance team might be in charge of breaking down the cost and billing it – but either way, you will need user information to do this accurately.
One of the biggest issues with managing this effectively is that most organisations are constantly fluctuating. Whether it’s new employees joining or leaving every month, or even moving to different departments – it can be a constant headache trying to accurately and consistently calculate each department’s cost, and charge it back to each business unit in your organisation. If you add different locations and thousands of users into the mix then it can become far more complicated to keep track of who is where.
The Problem
It isn’t possible to see where your licences are being used – or who by – using the Office 365 admin center, because you cannot get detailed user-level licence information. In the portal, you can see at top level overview of how many licences you have, and how many are assigned, but there is no ability to breakdown where these licences are being used in your organisation, or which user has which licences.
The billing section doesn’t allow you to drill down into the details of how your licences are distributed, and it provides a very limited overview of licence types, which makes it difficult to calculate, let alone assign licence costs effectively.
The Solution
Cogmotive Reports provides you detailed and comprehensive visibility of licensing so you can get a full view of your licence information in order to accurately and efficiently coordinate IT charge-backs for your organisation.
Step 1: Find where licence costs are being incurred
The ‘Licence by User’ report gives you the ability to drill down to user level and offers advanced filtering, so you can break down your licensing by a wide range of fields (Department, Country, even Cost Center if you have a custom attribute set). You can also take it a step further and see not only which users have which licences assigned, but whether those licences are being used. This gives you the opportunity to identify areas where you can reduce your Office 365 licence spend by assigning a cheaper licence to a user without them losing any of the functionality they need.
licence by user
Step 2: Streamline workloads and remove dependencies on IT staff time
Cogmotive Reports also makes handling the inter-department dependency aspect of charge-backs extremely simple, you can automatically generate and schedule licence reports to be sent directly to your Finance team, covering all of the aspects that they need to accurately bill each business unit. They can be emailed in PDF or .CSV in case an editable file is required that can be used to sort and filter further. This can be completely automated in just a few clicks, so you can set it to run at a regular point each month, minimising the IT staff time needed to generate reports or extract Office 365 data, and relieving the dependency, and streamlining the charge-back process. All you have to do is select the report you need, click on the ‘Schedule’ button located just above the table, and configure your preferences.
Account admins can also set up a user account with permissions to only view the licence reports necessary for managing the licence charge-backs, so the staff responsible can get the information they need without IT involvement needed – for further time savings.
Schedule text
Step 3: See the big picture, and use it to plan and optimise
The ‘Subscription Overview’ report gives you a full view of your licence pool to help you avoid overspending or underestimating your licensing needs. With this information, you can perform more accurate capacity planning, negotiate contracts with Microsoft with a more accurate understanding of organisational needs and optimise your licence spend. For example, you may find that some users aren’t using all the services they’re licensed for, so you might be able to assign them a cheaper licence to save on spend. You can also identify the specific users that haven’t been active on Skype for Business and target training to those users to drive adoption more efficiently, and ensure that your organisation is getting the full value of the services you’re paying for.
Step 4: Get exactly what you need, and then automate it
If you operate in a large multi-tenant enterprise, or use a different charge-back mechanism to manage your IT costs, and find that our built-in licence reports don’t give you exactly what you need, just use the Custom Report Builder to generate your own bespoke report by selecting your fields and applying filters specific to your organisation’s needs. If it’s a report you use regularly you can build it once, save it, then schedule it to be generated and emailed regularly to yourself or other users in your organisation.
Custom Report1
If you subscribe to Cogmotive Reports and use the ‘Licence’ section to manage IT charge-backs, make sure to keep an eye out over the next month as we will be adding a powerful, brand new feature that will make it even easier to see exactly how your licence costs should be allocated.
Not a Cogmotive Reports customer? You can take a free 14 day trial of the full reporting suite, and see what better Office 365 reporting can show you.
Cogmotive is the leading global provider of enterprise level reporting and analytics applications for Office 365. Find out more now.