Ways to save money on and optimize one of the world’s most popular software products

Microsoft’s Office is the world’s go-to business toolkit. Few companies choose not to supply licenses to their employee base. But as simple as Office 365 is to buy and deploy – perhaps even because of this – our team has noticed a disturbing trend when it comes to license optimization.

Clients routinely miss out on big opportunities to save money on their enterprise and commercial deployments.

Microsoft adds 3 million active Office 365 users every month. Early this year, the company announced its Office 365 commercial license user base had eclipsed 180 million. The company’s flagship SaaS productivity suite overtook its traditional on-premise Office counterpart in early 2017. As companies continue to mass migrate to the cloud, the number of online users will only grow. This adds to the urgency of both understanding and managing company licenses.

Understanding Microsoft Office 365 Plans

Easier said than done, understanding the scope of Office 365 plans is one of the more difficult aspects of license optimization. There’s a vast array of license types, each with features, access, and products that fit several roles for companies big and small. For the deskless worker, functionalities range from the most basic email, personal storage and web-edit options. Seasoned IT leaders can take advantage of a complete range of business applications, advanced analytics, and security and compliance tool access. Plus, everything in between.

The screengrab below shows just a sample of the comparison charts for the “What Office 365 plan do I need?” web search.

We almost always see the following Office 365 license types in our client deployments:

  • E1
  • E3
  • E5
  • F1

Companies should start here when looking ways to optimize their licenses. A granular description for what's included in each plan can be found on the Microsoft website. Use this list as a quick pulse check – do you have licenses deployed outside these types? If so, is there a good reason?

5 steps to Microsoft Office 365 License Optimization

When it comes to optimizing Office 365, we recommend that CIOs follow the umbrella principle for reviews. With this approach, companies start from the top, addressing 5 key points of efficiency.

1 ) Baselining user data

CIOs need to establish a list of all users by department and note what plan they have.

Without a SaaS management tool, this is a lengthy, manual process. But it’s a critical first step. CIOs need to establish a list of all users by department and find out which plan they have and the last time they signed in. Note should also be taken of which Exchange or OneDrive quota they have included (GB) and actually used, along with other data to assist with the optimization process. This helps with data-driven decision making, giving CIOs the knowledge required to empower super users with more data/tools and reduce waste from non-use.

2 ) Assessing non-use

You’ll likely find a mismatch of products and role types.

Eager leaders ready to optimize plans may want to stop paying for unused licenses and users, or downgrade others - but not so fast. Check with managers or individuals first – perhaps users are out on leave or have upcoming projects that require access to a certain tool. In general, however, you are likely find a mismatch between products and role types. For example, we have never found an accounting associate that uses Publisher - and for good reason.

3 ) Considering the mode of use

Up to 75% savings may be waiting just by assessing the desktop needs of your users.

Mobile, on-the-go users may never touch desktop versions of their applications. At this point, consider online/offline optimization possibilities. Full desktop versions of Outlook, Word, Excel, PowerPoint – and Access and Publisher for PC are included in Office 365 E5 or E3 licenses. An Office 365 E1 license offers web-access only but starts at a list price of $8/license versus $35 (E5) and $20 (E3). Just a quick assessment of your users' desktop needs can generate savings of up to 75%. Similarly, keep your eyes peeled for legacy Office ELAs (enterprise license agreements) that may still be active. Since users are covered by SaaS, Office 365 licenses do not need to be always in place. Take this opportunity to optimize this redundant or excessive licensing.

4 ) Making sense of storage

Consider your real storage requirements and downgrade options.

As you continue the optimization effort, diligence gets more granular. Here we’ll assess storage needs by license and user type. Office 365 E3 license users get unlimited personal OneDrive storage and 100 GB of email storage. Companies often run alternative storage apps like Dropbox, Box or Google Drive. If this sounds like you, consider your real storage requirements and downgrade options. Additionally, moving to a different plan may also make sense for license optimization if you’re, for example, using Google G Suite for emails and other Office apps for creation and collaboration. The ProPlus plan also offers reduced storage and removes business email.

5 ) Reviewing quarterly

Quarterly reviews ensure that companies keep their employees optimally equipped.

Finding the time for review is the final requirement, but license management ranks very low on most CIOs' favorite activities. Although this is understandable, there is no getting around the problem. Human resource moves and shifting organizational needs make it a necessity. New hires and fires come and go. Other SaaS products get popular while existing apps collect dust. By keeping up with this quarterly, companies can maximize their ROI and keep their employees optimally equipped. You can also monitor the Office 365 Admin Center to keep up to date with HR’s joiners/leavers/movers processes and manage assignments, cancellations or re-assignments on the go.

License optimization with Cleanshelf

Cleanshelf has helped dozens of startups and enterprise clients optimize their SaaS licenses. When you’re ready to inventory your Office 365 deployment, our solution instantly provides data on license use, cost and engagement. Whether you’re deciding on enterprise-wide annual renewals or trying to slash department overruns, we’ll do all the hard work so you don't have to.

Image credit: Microsoft

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About Cleanshelf

Based in San Francisco, Cleanshelf is the best way for enterprises to monitor and manage their SaaS spend. Our SOC 2-compliant and AI-powered technology saves our customers up to 30% on fees. Cleanshelf already helps businesses like Drawbridge, Ellation, Crowdriff, and Qumulo, among others. Join them now and gain control of your enterprise SaaS.

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