How To Deal With the White House’s New Software Policy

Chris Wiedemann_65 x 85CategoryMgmt_070716By Chris Wiedemann, Consultant

Cutting back on expenses is never easy. Ever had to give up a daily Starbucks habit to save some money?

The White House’s recent attempt to cut back on wasteful software purchases could cause a lot more pain to software firms than just missing out on a caffeine fix.

The policy calls for agencies to appoint software managers to centrally manage their software buying, says a recent Nextgov article. Agencies will also have to maintain a continually updated inventory of software licenses to track usage and weed out potentially redundant applications.

Agencies spend $6 billion on software annually, generated by about 42,000 different, individual transactions, creating a “fragmented and inefficient marketplace.” The policy’s intent is to leverage “the government’s vast buying power” and “save taxpayers’ money and deliver more value for the American people,” explained Tony Scott, U.S. chief information officer, and Anne Rung, who runs the Office of Federal Procurement Policy, in a White House blog post.

The new policy also creates a cross-agency task force with representatives from the General Services Administration, the Office of Management and Budget, and the Defense Department to develop governmentwide software license agreements.

So what does this mean for software providers? In the short term, suppliers with lots of siloed, potentially redundant installs with their customers will want to get in front of this. You can preempt an arduous consolidation process – and engender some good will with your customers – by reviewing your install base and bringing that information to future conversations with government end users.

Also coming down the pike are two new enterprise software agreements that the White House memo is promising will be in place by the end of calendar years 2016 and 2017. The concept sounds similar to the Continuous Diagnostics and Mitigation program under the Department of Homeland Security in that routes to market are being consolidated for whatever software gets covered under those agreements.

We’ll update you as we know more. Want guidance now? Reach out to immixGroup’s Market Intelligence team today.

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