10 reasons why IT asset management is important

1 Aug 2023 12:07 PM

Blog posted by: Juan Aedo, Service Architect, July 2023.

Planning and managing the full lifecycle of a company’s IT assets is a critical undertaking that helps maximize value, control costs, manage risks, support decision making and meet regulatory and contractual requirements.

That is one reason why ITIL 4 has separated IT asset management (ITAM) from the former ITIL v3 IT asset and configuration management process, as an independent practice focused on managing the lifecycle of all IT assets.

ITAM can be a titanic task, which is why it is important to define adequate scope and the right lifecycle model, both based on the organization's needs.

So, what are the top ten reasons why ITAM is important?

1. Provides visibility

ITAM provides visibility of assets and their value; by having all IT assets correctly identified and tracked a company will know what they own, where assets are located, who is using them and how.

2. Improves operations

By controlling the assets during the different stages of their lifecycle, operations gain efficiency:

• Requirements – based on the lifecycle model – are accurately provided during IT asset planning, budgeting and acquisition.
• Assets ownership is tracked during the IT asset assignment.
• Information about maintenance contracts, licensing, vendor support, forecasting and optimization is available during IT asset utilization.
• IT assets decommission and disposal will follow defined procedures and comply with regulations and requirements.

3. Reduces costs

Controlling IT assets will enable cost reduction in terms of:

• Knowing the volume and capacity of the assets facilitates efficient future planning.
• With the support of the configuration management practice, obtaining an accurate cost calculation of the key services and invest where necessary.
• Detecting wasted or underused assets that can be reallocated or even be decommissioned.
• Knowing the exact volume of IT assets allows better negotiation with hardware, software, and support suppliers.
• Identifying ghost assets and preventing theft.

4. Mitigates risks

Managing IT assets entails managing risks, such as security, legal or contractual compliance or the technology itself. Asset control, using an appropriate life cycle model, can mitigate these risks including:

• Having software mapped to the current license prevent breaching terms and conditions of use.
• Controlling physical access to assets.
• Complying with countries’ regulations on the management of technological waste to avoid sanctions.
• Minimizing the risk of technological obsolescence which can cause operational risks.

5. Increases information security

ITAM helps avoid security breaches by:

• Enabling appropriate security based on identifying the purpose/role of the IT assets and their location.
• Keeping the software properly patched by controlling the technology lifecycle, ensuring all software assets are in-support and warning when support is ending.
• Tracking and avoiding the existence of unknown or unauthorized IT assets.

6. Allows thinking about sustainability:

The decisions made in choosing a technology, hardware, software, or cloud services will have a certain impact in terms of energy consumption, carbon footprint and waste disposal, among others. An adequate IT asset management model will allow better decisions about renewing technologies, reusing existing resources, reducing and managing waste sustainably.

7. Supports financial and cost control activities

An accurate IT asset register supports financial and cost controls by providing a complete inventory covering all IT assets and calculating direct and associated costs like hardware, licensing or cloud; this also helps return on investment for IT assets.

8. Improves ITSM capabilities

There is a synergy and mutual support between ITAM and other ITSM activities:

• Configuration management and ITAM can work together to define a trusty configuration management system.
• Incident management will use information related to IT assets with a reported incident.
• ITAM can help decisions related to software and hardware change or provision.
• Service level management requires information about third party support contracts needed to define end-to-end service level agreements and operational level agreements.
• Service request can create request catalogues based on the information existing in ITAM.

9. Reduces efforts during audits

Information requested during audits can be gathered easily and faster from an accurate ITAM system, reducing time and effort.

10. Improve IT governance

All benefits provided by ITAM improve IT governance. This helps to make better decisions regarding new acquisitions, providing visibility and supporting ITSM processes which support company objectives and strategies.