If you’re a medium- or large-sized business, there’s a solid chance you’ve heard Microsoft’s enterprise agreement (EA) spiel. According to their website, it goes a little something like this:
“The Microsoft Enterprise Agreement offers the best value to organizations with 500* or more users or devices that want a manageable volume licensing program that gives them the flexibility to buy cloud services and software licenses under one agreement.”
Depending on your situation, the benefits Microsoft advocates – that the EA will give you the best pricing, discounts and flexibility, along with streamlined management – may end up being accurate. But if your organization is growing quickly, pivoting rapidly, or otherwise in flux, you might actually end up overspending on an enterprise agreement, rather than saving money.
Here’s the deal: an EA’s price is “tiered to the number of computers being licensed, and is a three-year contract that gives you the option to license almost every Microsoft product that you need.” And that’s great – if the number of computers being licensed is fairly static. But throughout that three-year agreement, Microsoft performs a couple “true-ups.” They define the true-up as an “annual inventory of products, services, users and devices added during the year.”
That means on each anniversary of your agreement between the first and third year, the company comes in and figures out exactly how many devices you’ve added between the last true-up and now.
It’s fair … you’re basically accounting for the devices that have been enrolled on your EA but not yet paid for. But while you may have paid less up-front with the EA, you owe a lump sum payment for every device added between true-ups. And even if those devices were added just a few weeks before the true-up, Microsoft charges you as if you added the device midway through the year and will continue using it through the end of your three-year agreement.
For organizations without a SaaS management platform, controlling and tracking devices that were added throughout the year isn’t a priority. But if you aren’t keeping track of your added devices in real-time, you could be facing a nasty surprise.
To make sure you aren’t killing your annual technology budget at each Microsoft true-up, you need to take two steps.
- Explicitly define which devices fall under your EA. Make sure you know exactly which devices are defined as “enterprise products” within your EA, and you’ll be more able to track how many are added throughout the year.
- Implement a SaaS management platform. A solution like Applogie tracks in real-time which SaaS products are installed on which devices, and by which users. That means you can manage your expectations of Microsoft’s annual true-up under your EA, pull back on out-of-control implementations, and better understand what you’re getting from your EA.
Enterprise agreements are complicated. Microsoft is usually very willing to talk through the specifics of your potential agreement, but if you’d like an outside perspective on how your particular organization could benefit (or not) from the EA, reach out to Applogie. We’ll audit your SaaS usage and give your our recommendation on how best to move forward with Office 365 and the rest of the Microsoft product suite.