Azure
Managing Microsoft 365 licenses in large enterprises should be simple in theory: buy what you need, assign licenses efficiently, and monitor usage to optimise costs. However, it often turns into a minefield of inefficiencies, hidden costs, and chaotic processes that lead to massive overspending. Organisations struggle with central purchasing, cross-charging, lack of insights into costs, and an overall inability to effectively manage licenses. Here’s why enterprises find themselves burning money on Microsoft 365 and how Prism can be the solution to these challenges.
Many enterprises rely on a centralised purchasing model for Microsoft 365 licenses. While this approach provides volume discounts and simplifies procurement, it also leads to a fundamental disconnect between purchasing decisions and actual license usage. IT teams or procurement departments buy large quantities of licenses based on outdated estimates, and these licenses get distributed without a true understanding of who needs what. The result? Unused and unnecessary licenses remain active, silently draining budgets.
Potential Solution with Prism: Prism can automate the tracking of license usage, providing real-time insights into who needs what. This ensures that licenses are purchased based on actual needs rather than outdated estimates, reducing the number of unused licenses and saving costs.
Once licenses are purchased, organisations often attempt to allocate costs back to individual business units, departments, or regions through cross-charging. This process is rarely seamless. Lack of clear ownership, missing data, and decentralised tracking mean that IT teams spend excessive time manually calculating chargebacks. Without automation, these calculations are prone to error, leading to incorrect budgeting and frustrated stakeholders.
Potential Solution with Prism: Prism can automate the cross-charging process, ensuring accurate and efficient allocation of costs. By providing clear ownership and centralised tracking, Prism reduces the time spent on manual calculations and minimises errors, leading to more accurate budgeting and happier stakeholders.
One of the biggest challenges enterprises face is gaining clear visibility into their Microsoft 365 license costs. While Microsoft provides various reports and dashboards, they often lack the granularity needed to make informed financial decisions. Understanding exactly how much a department or cost centre is spending requires pulling data from multiple sources, cross-referencing information, and making sense of scattered reports. This is a cumbersome and time-consuming process, leaving many organisations flying blind when it comes to actual spending.
Potential Solution with Prism: Prism offers granular visibility into license usage and costs, consolidating data from multiple sources into a single, easy-to-understand dashboard. This allows organisations to make informed financial decisions quickly and efficiently, reducing the time spent on data analysis and improving cost management.
Microsoft offers tools like the Microsoft 365 Admin Centre and Power BI reports, but extracting actionable data from these tools is an uphill battle. Licensing data is often fragmented across different portals, requiring IT teams to piece together information manually. The lack of a simple, consolidated view forces organisations to rely on error-prone methods—like exporting raw data into Excel just to analyse trends and consumption. This introduces another level of inefficiency and risk.
Potential Solution with Prism: Prism provides a consolidated view of all licensing data, eliminating the need for manual data extraction and reducing the risk of errors. By integrating with Microsoft’s tools, Prism ensures that all relevant data is available in one place, making it easier to analyse trends and consumption.
In the absence of robust reporting tools, many enterprises turn to Excel for license management and chargeback calculations. While Excel is a powerful tool, it is not designed for managing the complexities of a large-scale licensing environment. Manual data entry, formula errors, and outdated information lead to significant financial miscalculations. A simple mistake in an Excel formula can result in tens or even hundreds of thousands of pounds in unnecessary costs.
Potential Solution with Prism: Prism automates license management and chargeback calculations, reducing the reliance on Excel and minimising the risk of human error. By providing accurate and up-to-date information, Prism ensures that financial calculations are correct, saving organisations from costly mistakes.
One of the biggest culprits of Microsoft 365 overspending is the renewal of unused licenses. Many organisations lack a formalised process for identifying and deactivating inactive licenses. Employees leave, job roles change, and accounts become obsolete, yet their licenses remain active. Without proper governance, businesses renew licenses year after year without realising they are paying for users who no longer exist.
Potential Solution with Prism: Prism enforces periodic reviews to identify and reclaim unused or unnecessary licenses. By automating the deactivation process, Prism ensures that organisations only pay for active users, reducing the cost of unused licenses.
Enterprises frequently assign users higher-tier licenses than they actually need. Microsoft 365 E5 licenses are powerful but expensive, and not every user requires the full suite of features. Instead of carefully assessing each employee’s needs, organisations often apply a “one-size-fits-all” approach, leading to unnecessary costs. Even worse, many enterprises waste money by licensing non-human entities—like conference rooms and service accounts—with full user licenses. These accounts do not need premium features, but due to a lack of oversight, they continue to be assigned costly licenses that add up quickly.
Potential Solution with Prism: Prism helps avoid over licensing by rightsizing users based on their actual needs. By providing detailed insights into license usage, Prism ensures that each user is assigned the appropriate license, reducing unnecessary costs. Additionally, Prism identifies non-human entities and assigns them the correct licenses, further optimising costs.
To mitigate this chaos and bring costs under control, enterprises must adopt a more disciplined approach to Microsoft 365 license management. Prism can be the key to transforming this approach by:
Microsoft 365 is a powerful tool, but without proper management, it can quickly become a budgetary black hole. By addressing these inefficiencies head-on with Prism, organisations can transform their approach to license management—reducing costs while ensuring that users have the right tools for the job.
