What Is IT Asset Management - ITAM Benefits - Why Business need ITAM
What is IT Asset Management?
IT Asset Management (ITAM), i.e., Information Technology Asset Management is a business practice that comprises the set of processes for managing the IT assets concerning strategy, financial, procurement, inventory, retirement, and disposal, etc. (like software, hardware, and services) to enable cost-efficient and timely delivery of business services within the organization. IT Asset Management Benefits organizations integrate a solution process that manages the life cycle of information technology assets throughout the organization.
IT Asset Management Benefits
An IT Asset Management system is an important, foundational piece of the overall systems necessary to manage IT infrastructure. Without good IT Asset Management, an organization will waste time and resources managing inventory, buying unnecessary equipment and software, and maintaining license compliance for software. With a well-functioning IT Asset Management system, the organization can expect to reduce the total cost of ownership for IT infrastructure and provide a solid foundation to keep the IT infrastructure operating efficiently.
Crucially, ITAM enables the financial management of IT assets. A good IT Asset Management solution provides cost-effective stewardship of IT assets and the resources to provide IT services. To implement an accurate ITAM system, tools must be aligned to processes that are event-oriented and traceable.
IT Asset Management is most importantly a management system supported by organizationally defined metrics. Without a metric focus, there is no IT Asset Management initiative. Furthermore, if there is no baseline for forming the asset repository, then it is nearly impossible to relate the underlining assets to the critical business services that are being delivered. Complete business management of IT assets requires a repository of multiple types of information about the support and integration with other systems such as supply chain, help desk, procurement, and HR systems.
IT Asset Management stores all relevant information about that asset, such as user, location, asset type, model, serial number, and more. Important information such as cost or leasing information, decommission or replacement date, history, maintenance, repair, change and upgrade information are all held within the ITAM data repository. Once an IT asset is disposed of, all of the historical information about that asset is stored within the IT Asset Management solution.
IT Asset Management is not just about storing data; it extends to deploying that data successfully to operations and synchronizing tasks. The automation of procedures is vital in the coordination of large-scale projects. Not only does it help operators in their daily tasks, but the collection of data throughout operational processes also reduces the risk of double entries and human error.
IT Asset Management's ultimate goal is that an employee has the relevant information in the most appropriate format at the right time. The data can be used for management reporting, financial reporting, auditing, and planning purposes. Data can be linked between systems, usually using a single source of data rather than unnecessary duplication of the same information in multiple places.
IT Asset Management and its Benefits
Value to Business
- IT Asset Management provides essential management information for utilizing IT assets efficiently, economically, and cost-effectively throughout all stages of the IT asset’s lifecycle.
- Provides the business with information to make the correct decisions in gaining a competitive edge
- Reduces costs – specifically costs related to the physical or virtual IT assets of the organization.
- Manages IT asset resource utilization; Releases capital back into the business.
- Minimizes risk of non-compliance to regulations
- Optimizes the quality of data and processes to improve business performance
- It helps improve the bottom line profitability of the business.
Value to the IT Organization
- Optimizes the IT infrastructure, resources, and capabilities
- Evolves the IT organization to meet business needs
- Provides visibility in costs related to IT assets and business services
- Improves the procurement, change, and retirement processes for IT assets
- Enables accountability by charging back to the business unit
- Supports Service Management processes with accurate IT asset information
- Foundational to the Service Asset and Configuration Management initiative in the IT organization
Why does a business need ITAM?
Finance lacks insight into IT Assets maintained in the organization, which is legally required for the Balance Sheet assets.
To record IT spending as an investment in the company’s Balance Sheet, the organization must know if it still exists and contribute to its business.
Avoids additional expenses and penalties
Organizations don't want to pay maintenance and support fees for IT Assets that are no longer in use, and they want to avoid risk penalties or unsupported issues for IT Assets in use.
Provides the ability to reuse assets effectively.
When IT Assets are returned before the end of their technical or economic life, they are not effectively reused. Instead, organizations buy/lease new assets and leave the used support on the shelf.
Minimizes the compliance and regulatory risk
Knowing what IT Assets we have, where they are, and where they are used for mitigates the risk of being under licensed and the risk of violating regulations.
Reduce the time and effort required to gather information during audits
Provides information to internal and external auditors that they require during audits as it costs significant time and effort. Having the required information in a central repository and reporting on that easily will avoid reinventing the wheel every time, saving a significant amount of time and effort.
Effectively retire assets
Nowadays, IT assets need to be retired and disposed of according to environmental regulations and data security policies. Also, any residual value needs to be cashed.
Determines Total Cost of Ownership and actual asset value
Determines TCO includes costs of acquiring the assets all costs associated with exploiting the support during its lifecycle. The actual asset value is the real value at any given time, not necessarily purchase price minus depreciation.
Determines ROI for IT Assets
Determines not only costs but also Return on Investment for IT Assets adds additional information for decision making.