What Is IT Asset Management (ITAM)?

7 min read

IT asset management (ITAM) is the end-to-end tracking and management of IT assets to ensure that every asset is properly used, maintained, upgraded and disposed of at the end of its lifecycle.

ITAM involves using financial, contractual and inventory data to track and make strategic decisions about IT assets. The main objective is to ensure that IT resources are used efficiently and effectively. ITAM also helps optimize costs by reducing the total number of assets in use and extending the life of those assets, avoiding costly upgrades. An important part of ITAM is understanding the total cost of ownership and finding ways to optimize asset use.

What is an IT asset?

An information technology (IT) asset is any piece of information, software or hardware that an organization uses in the course of its business activities. Hardware assets include physical computing equipment like physical servers in data centers, desktop computers, mobile devices, laptops, keyboards and printers. Software assets, on the other hand, include applications for which licenses are typically issued per user or machine, as well as software systems and databases built using open-source resources. Software assets also include cloud-based assets, such as Software-as-a-Service (SaaS) applications.

How does an IT asset management process work?

The IT asset management (ITAM) process usually involves the following steps:

  1. Asset identification: The first step in IT asset management is to create a detailed inventory of all IT assets. This enables easy identification and ensures that redundant assets are optimized for greater efficiency.
  2. Tracking: This involves using an ITAM tool or system to continuously monitor IT assets. Information collected for tracking each asset includes financial (asset costs), contractual (warranties, licenses and service-level agreements (SLAs)) and inventory data (location and condition of physical assets).
  3. Maintenance: IT assets are maintained according to their lifecycle stage. Maintenance involves asset repair, upgrade and replacement. All maintenance activities performed on an IT asset are logged as part of the ITAM process so that the data can be used to assess the performance of the asset.

Stages of an IT asset lifecycle

Every IT asset has a finite lifecycle. IT asset management (ITAM) is about managing an asset’s lifecycle to ensure maximum productivity. While each organization may define unique lifecycle stages, an IT asset lifecycle generally includes the following stages:

  1. Planning: This involves making decisions about assets needed by an organization, their intended use and how to acquire them. Organizations also consider competitive alternatives and carry out cost-benefit and TCO (total cost of ownership) analyses of all possible options while planning for asset acquisition.
  2. Procurement/Acquisition: Assets may be acquired by buying (including Software-as-a-Service), building, licensing or leasing.
  3. Deployment: Asset deployment may involve installation, integration with other tools, providing user access and providing technical support.
  4. Maintenance: Once the assets have been deployed, provisions should be made for regular maintenance, upgrades and repairs to optimize their use and maximize value. This will prolong their lifespan, minimize costs and mitigate risks.
  5. Retirement: An asset is retired when depreciation sets in and maintenance is no longer feasible. That is, an IT asset reaches the end of its lifecycle when maintenance becomes more frequent and the organization spends more resources on it than it used to. An organization can also decide to retire an asset if there are better alternatives in the market. Asset retirement involves disposing of old assets, updating asset information, terminating support and license agreements and making plans to transition to new assets.

Benefits of IT asset management

Efficient IT asset management (ITAM) can help an organization make better business decisions. Some of the key benefits include the following:

  • Centralized asset database/inventory: Assets are difficult to manage when they are tracked in different places. Inaccuracy and disorder may set in, leading to inefficiency and poor business decisions. Having a single source of truth makes asset tracking easier and more efficient. The organization can see in one place what assets need to be discarded, upgraded or optimized for maximum productivity.
  • Optimized asset use: IT asset management leads to efficient use of resources, mitigates risk, minimizes waste and reduces cost. By establishing an ITAM process, an organization gets real-time data on the state of all its assets and can make informed decisions about asset use.
  • Software license compliance: Organizations that license third-party software often must undergo software audits by software providers who want to be sure these organizations comply with the license terms and conditions. Defaulting on the agreements can lead to serious fines. Thus, organizations use ITAM software to automatically monitor all software installed on all computers on their networks and ensure they comply with the relevant license agreements.
  • Informed decision-making: ITAM data helps with the evaluation of previous purchases and deployments, which then informs subsequent actions. ITAM can improve IT asset purchase and business processes.

IT asset management software

As an organization’s IT assets grow, managing them via manual, paper-based or spreadsheet systems becomes cumbersome. IT asset management (ITAM) software is a centralized application used for asset lifecycle management and tracking.

Features of ITAM software

IT asset management software solutions usually include features that give organizations better control of their IT environment and enable them to track assets on-premises and in the cloud:

  • Automated detection: Most IT asset management systems automatically detect all hardware and software installed on an organization’s network of computers.
  • License management: ITAM software stores IT asset licenses. These are then cross-referred to the relevant inventory data to alert the organization if it’s under-licensed and at risk of breaching a license agreement or over-licensed and acquiring software it underuses or never uses. This functionality can also track the expiration dates of license agreements and inform the organization accordingly.
  • Version and patch management: Asset management software tracks the deployment of new software patches and versions to keep an organization’s suite of computers secure, up-to-date and running smoothly.
  • Request management: Some ITAM software can track all requests for IT assets and allow organizations to define asset request workflows. They evaluate license requirements for these assets and manage the acquisition and deployment process.
  • Inventory management: ITAM tools keep a record of all assets used by an organization. The inventory records asset data like name, type of license agreement and version.
  • Configuration management database (CMDB): The CMDB is a centralized database that stores information about an organization’s IT assets and the relationships between assets.
  • Fixed asset management: Most ITAM tools have a dedicated repository for managing fixed asset data. Fixed assets mainly include hardware.
  • Digital asset management: This feature of ITAM software involves the management of digital rights and rich media (e.g., multimedia content like videos, music and photos).

Factors to consider when choosing ITAM software or an asset management solution

  • Purpose: An organization should have a clear idea why it needs ITAM software and the objectives it hopes to accomplish by going digital in its asset management. If possible, management should set up meetings with all relevant IT departments to get their opinions.
  • Cost: When an organization has identified software packages that meet its objectives and expectations, the next step is to compare prices against its budget. Understanding what each package offers and does not offer at the price may be helpful. Consider taking advantage of a free trial period before deciding to buy.
  • Technical support: Organizations should choose a software provider that offers technical support whenever needed. This support can come in the form of a self-service platform, an online community of users, in-app or web chat with a bot, phone support or chat with a customer care assistant on social media.
  • Reviews and ratings: Reading reviews of current and past users of a software package on third-party sites (e.g., app stores and software rating agencies) can help an organization make a good choice.

IT asset management (ITAM) vs. IT service management (ITSM)

While IT asset management is about managing IT assets throughout their lifecycles, IT service management (ITSM) is about managing and delivering IT services.

IT service management is the process of managing IT services in an organization. It includes many components, from planning and implementing IT services to monitoring and auditing them to make sure they are running smoothly and efficiently. IT services include help desk and service desk support (such as guiding a user on how to change their password) and change management procedures, which involve efficient handling of changes to IT infrastructure.

The goal of IT service management is to provide reliable, high-quality IT services that meet the needs of the business and its end users, including customers, employees and business partners. ITSM aims to improve user experience and service quality.

The IT Infrastructure Library (ITIL) is considered the best approach for delivering ITSM. It is a library that provides the best practices and framework for efficient ITSM. The most recent ITIL version, ITIL 4, comprises five volumes — namely, Service Strategy, Service Design, Service Transition, Service Operation and Continual Service Improvement — that detail 34 ITSM practices.

In a way, ITSM encompasses ITAM. Asset and configuration management are among the many ITSM processes, and a CMDB — which is the tool dedicated to this process — is a centralized repository of an organization’s IT assets and the relationships between them.

IT asset management and IBM

Hybrid IT environments — with software, hardware and cloud solutions from many vendors — are becoming more challenging to manage. A barrier to successful management of these complex environments is the organizational and platform silos between IT operations and procurement teams. Any changes made by one team will likely affect the other, yet neither team has visibility to understand the impact of change. For example, how can you confidently manage your IT environment if you don’t understand how the changes you make will affect license compliance and possibly result in overprovisioning? If you move an application workload to a different cloud or server, will this move put you out of compliance or cause surprise billings or true-ups? And if you don’t move workloads, what’s the impact to the performance of applications and services?

The answer for most organizations is to build in buffers by overprovisioning IT resources and restricting license allocations. Understandably, licensing is complex, and IT resource usage can change on a second-to-second basis. How can you optimize IT resources and licensing to deliver on application performance expectations?

IT asset management solutions like Flexera One with IBM Observability can provide an accurate view of IT asset inventory and keep you audit-ready with visibility into the allocation of assets across your hybrid cloud, multivendor landscape. Integrations with IBM Turbonomic® allow you to automate and optimize license compliance and IT spend.

Avoid surprise billings and true-ups while optimizing application performance.

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