Success Story of HARTL GROUP
At the end of 2013 we were in the fortunate situation of securing increasing hosting revenues and being able to grow nicely in the hosting business. However, the associated organizational requirements and reporting obligations for the licensors presented us with almost intractable problems. Hosting also entails handling license management in a legally compliant and audit compliant manner.
Hosting also entails handling license management in a legally compliant and audit compliant manner. Without consistent and complete license management, cost-efficient and legally compliant growth is not possible. Looking at the increasing audits by software manufacturers with often unclear and undefined requirements, the problem quickly becomes visible. Detailed recording procedures and associated processes were necessary here in order for the relationship between earnings from hosting on the one hand and the expenditures for administration and controlling
on the other to be kept within reasonable bounds. The additional business could have easily turned into loss-making business. There was of course no obligation to focus on controlling and reporting.
“But do we know what will happen to our company if enormous additional payments have to be made after an audit just because the data were not recorded in the
way the manufacturer requires? We just did not want to run the risks this entails at that time and would have rather foregone the additional business than invest in such an uncertain future.
30% of the total expenditure is required for administration and controlling effort
On the other hand, it also happened occasionally that services provided to customers were not charged correctly because
the communication between the technology and the administration was error-prone. That had nothing to do with flawed
organization – the corresponding ISO certified processes were defined sufficiently and clearly. No, the issue of licenses in
hosting is itself so complicated that errors inevitably crept in here occasionally.
For example, it quickly came up that although we had reported licenses to a software manufacturer, we had not passed the charges on to the customer. According to our experience at that time, the administration and controlling effort and the associated processes required more than 30% of the total expenditure of our hosting business. This percentage would have gotten worse rather than better with increasing business. On the basis of these facts, we decided at the beginning of 2014 to introduce CPL24.
Reduce administration costs with CPL24
After an implementation phase of about one week, we were able to eliminate all the problems and risks mentioned above and finally utilise the capacities this freed up for sales and customer support. With the rollout of CPL24, it was possible to reduce the previously very costly administrative tasks, such as customer billing, record-keeping and reporting, to a negligible level immediately. Integration into existing processes, extensive automation and integrated controlling, as well as retention of historical data, occurred immediately. The expenditures for the rollout and the ongoing licensing costs paid for themselves quickly, since the license costs are also coupled to the volume of business and only charged in the amount corresponding to the hosting volume.
The total costs of CPL24 were offset immediately by the additional manual effort saved. If you look at all expenditures and savings, we were able to achieve significant cost savings through this. Not only does that increase our margin, but we can also finally grow without additional expenses and still have the security that we will not suddenly face unexpected surprises in the event of an Audit.
Audit confirmed the success of the solution
Incidentally, this was confirmed in an external audit in April 2014. All processes introduced and managed by CPL24 have
lead to a balanced license report. They even certified that our recording logic is more precise that the auditor’s. We currently
use CPL24 with all add-on modules such as CRM, ERP, customer portals, SLA administration and software development. By
the end of 2015, CPL24 will also automate all our technical processes in the Data Centre up to 80 %. In a nutshell: it is nice
when no more time is wasted on organizational tasks and we can once again devote ourselves to the things that actually
move the company forward. We now leave the remaining ‘tedious and time consuming stuff’ to CPL24.