Case Study Verafirm Certification KPIT Technologies Limited

Case Study Verafirm Certification KPIT Technologies Limited

Contents Sr. No. I Background II Business Challenges III IV Road to Verafirm Certification Approach: Test of Design & Effectiveness V VI Results & Benefits Conclusion

I. Background on KPIT II. Business Challenges KPIT Technologies, one of the fastest growing global IT consulting and product engineering partner, is focused on co-innovating domain intensive technology solutions for corporations specializing in automotive & transportation, manufacturing and energy & utilities. A leader in technology solutions and services, KPIT currently partners with 200+ global corporations including Original Equipment Manufacturers (OEMs), semiconductor companies and Tier 1 companies. Considerable investment in Software Assets and lack of visibility on Return on investment prompted KPIT to streamline their Software Asset (SAM) processes so as to manage their software assets effectively. KPIT realized that frequent audits from Software publishers and non-compliance due to license over-deployment could lead to heavy monetary penalties. Lack of accountability & responsibility in regards to software inventory purchase and usage increases support costs. Needed to maximize utilization of software in-stock and also have all necessary licenses reconciled Desired to be 100% compliant in any third party software license review Risks Controlled Software being the core component of KPIT s business processes, KPIT decided to strategically manage their software assets. This not only supports, but also enhances daily business activities. An effective SAM plan helped KPIT control the following risks: Compliance - Non-compliant environment leads to mismanagement and chaos Financial - Heavy monetary penalties could be levied in case of over-deployment or license infringement Legal - Third party software reviews have huge legal implications Reputational - Noncompliance and penalty paid negatively affects the goodwill of a target firm III. Road to Verafirm Certification

IV. Approach: Test of Design & Effectiveness KPIT was tested across various SAM policies and procedures to verify if it was in line with Verafirm standards. The key parameters assessed are as follows: The SAM life cycle process included the Acquisition, Deployment, Maintenance and Retirement of the software and this process was orderly formulated. An estimated 10,800 man hours were spent at KPIT in setting up their SAM policies and processes. An onsite review at KPIT was carried out where the parameters across defined KPI s (Key Performance Indicators) were measured. The approach included a mix of the following key steps offered by KPMG: Key Steps

V. Results and Benefits Operational Better control of software assets across the organization Enhanced visibility in software asset Annual Maintenance Contract (AMC) renewals considering usage and future requirements Post implementation of SAM, software license compliance at KPIT improved from no visibiity to 100% visibility ensuring 100% compliance Financial Deployment of open source software in avoiding considerable investment as it is readily available for use without any licensing fee. Exemption from software audit by publishers for defined period(between 2-3 years depending on publisher policy) Avoidance of penalties paid to Software Publishers due to noncompliance Business Performance Improved effectiveness in new procurements, AMC renewals, customer contracts 100% license compliance demonstrated in all 3rd party software licensing audits Huge improvement in Software Asset utilization and overall ROI Improved Employee Satisfaction Information provided by SAM helped managers and employees justify purchasing the software they need to do their jobs more easily Improved productivity and increased overall job satisfaction due to avoidance of time wastage in SAM as was before with the help of Self service Reduce Support Costs Standardizing desktop images dramatically reduced support costs Restricted local admin rights and download privileges to users helped in centralized software deployment and tracking Self service portal for request, approvals and autodeployment of Packaged applications helped in faster application deployment from the centralized source improving SLAs

Percentage Reduction in IT Support Time and Cost: 120 100 80 80 % 99.5 % 40% 60 40 20 0 2012 2013 Year Software Request to Installation Time 2012 2013 Year IT Cost for Software Deployment Time taken from software request to final installation improved from 80% in 2012 to 99.5% in 2013 In 2013, the total IT cost for software deployment reduced by 40 % after a Self Service Portal was deployed for software life cycle tracking Idle Asset Valuation: Idle asset value is the percentage of total software assets (software/systems) present in the premises but not deployed during their useful life. KPIT amortizes its capitalized software over the defined useful life of four years. Software metering and redeployment helped in improving software utilization at KPIT by 20%. Post the implementation of strategic software asset management plan, KPIT reported a steady decline in idle asset percentage from 3.5% in 2010 to nullity in 2013. Return on Investment: Though impact on return on investment was not directly measurable, a relation between amount invested and the potential financial risk saved in monetary terms was noted. KPIT got largely benefited by effective utilization of Software Assets improving end user productivity. 100% control on software assets helped in avoiding potential licensing gap, penalties paid due to non-compliance, rising costs due to mismanaged software etc. Open Source software deployment also helped in avoiding substantial investment in new software assets. Ongoing processes for Software metering and redeployment of Software assets helped in avoiding investment of approximately 5 crores in last 2 years.

VI. Conclusion KPIT s Overall Conformance with Verafirm Standards: A total of ninety seven control mechanisms were tested and measured across the defined parameters for Verafirm at KPIT. A score of 90% was achieved through the process audit. Sufficient documentation was present for all the processes as prescribed by Verafirm. Some areas of improvement included increasing the periodic review of control mechanisms which was noted as a recent introduction into the overall process. Reviews will take place at regular intervals once data gets built over time. Across the 4 KPI s that spread over the relevant process control areas, KPIT was found to have a robust process mechanism under the Organisational, Core SAM es, Operations & Financial management retirement and SAM Lifecycle es. Mentioned below are the processes that were implemented by the Verafirm activity at KPIT: Organizational scope and overall responsibility Software Asset Inventory Policies, processes & procedures for SAM Planning &implementation processes for SAM Software Asset Identification Software License Compliance Service Level for SAM Change Incident Problem Financial for SAM Acquisition Software Deployment Relationship & Contract Retirement As the key parameters of the program met the overall standards set out by BSA The Software Alliance, KPIT was accredited with BSA The Software Alliance Verafirm Certification.

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