Office 365 License Management: 5 Tips to Forecast O365 License Needs

If you’re coming up on your EA, you might be scrambling to accurately forecast your Office 365 licensing needs.

Unfortunately, with E3s, F1s, add-ons, and more, it can be tricky business to accurately determine your licensing needs without the proper Office 365 license management solution in place.

Tip #1: Clean it up

The first step in accurately forecasting your organization’s licensing needs is cleaning up your current environment. Unfortunately, this isn't always easy to track and often takes multiple manual reports and constant upkeep.

Although it's tricky, it's an important component of Office 365 License Management to take a good look at the licenses your employees currently have. Do they have access to all of the resources they need to remain productive in their role? Are they perhaps over-licensed? It’s possible that some of your employees may be able to move to a cheaper license without affecting their day to day at all.

Another situation that is often overlooked is when a user is temporarily upgraded to a higher license to complete a particular project and is not moved back down after the project is complete.

It’s important to take the time to ensure that your current users are equipped with the tools they need to maintain productivity in your organization while still ensuring your organization isn’t overpaying for unnecessary licensing!

Tip #2: Report on historical trends

The best indicator of future needs is historical trends. Therefore, a great way to predict your organization’s future licensing needs is to take the time to reflect on your organization’s previous licensing needs in recent years.

Of course, it’s important to take company growth into account including fluctuating factors such as the number of employees and employee needs which are constantly changing. Factors such as seasonal hiring, onboarding classes, and summer interns all affect your organization's licensing needs and historical trends regarding these factors can be a great asset.

However, that doesn’t mean that your historical trends aren’t a great resource that should be considered when forecasting future licensing needs.

For instance, if you’ve needed additional licenses in quarter 3 for the past three consecutive years, it may be a good idea to ensure your licensing reserve is prepared to handle that need.

Tip #3: Factor in growth and hiring plans

As previously mentioned, the number of employees within your organization is one of the biggest factors that effects your licensing needs.

If your organization is planning to bring on more employees than what is expected in a typical year, that is information you need to know in order to effectively forecast future Office 365 license needs.

Perhaps, your organization is planning to expand a certain department or cut back in certain departments they feel they are overspending in.  All of these decisions affect future licensing needs and therefore will affect your EA and licensing plans.

In addition to new hires, it's also important to factor in department functions. Although it's a great start to have an expectation for new hires, needs often vary by department as well. For instance, project majors may need Microsoft project, Business Analysts may need PowerBI, and so on and so forth. 

Tip #4: Office 365 license reserves - finding the sweet spot

A huge component of Office 365 License Management is your license reserve. Oftentimes companies purchase excess licenses during their EA to cover growth and contain costs.

However, it’s also possible that you are wasting money here. Some organizations prefer to keep larger reserves in order to reduce risk even though it results in higher costs. On the other hand, many organizations prefer to keep smaller reserves in order to save money.

When your organization has experienced major growth you may need more licenses than you have in your reserve. It's crucial that you purchase additional licenses as assigning more licenses than you purchased can trigger a Microsoft audit and hefty penalties if you are at fault.

Tip #5: Continually check in with business stakeholders

Although having licenses in your reserve is an important part of Office 365 License Management, it’s possible you may be able to reduce your reserves by a small percentage to avoid wasting money without your organization feeling any impact. Most organizations are able to reduce their license reserve by roughly 5% which can save your organization big money with no effect on your employees.

Your Office 365 license management plan should align directly with your business goals. Therefore, if those business goals or plans are changing, it’s important that you’re in the loop.

If we’ve learned anything throughout the past year, it’s that plans can change in an instant. When they do, it’s important that your organization and licensing plan is able to change with those plans.

Staying in the loop on company goals and future plans better allows you to provide your organization with the tools they need to remain productive and reach those business goals.

Office 365 License Management

Managing Office 365 licenses is no easy task and forecasting for future needs can be exhausting. At ENow, we believe in ‘buy only what you need, and adopt all that you buy’, and our solutions can help you achieve just that.

Efficiently and effectively optimize your Office 365 licenses to make informed licensing decisions with ENow Office 365 License Management reporting, including: customizable trend analysis, real-time licenses user lists, license addition history, and much more.

Access your free 14-day trial today! Be the IT hero and drive out any hidden costs.