For many companies and engineering managers, March 31st marks the end of a financial quarter, a time when engineering budgets come under review. One of the most significant costs, after salaries, is the expense of engineering software applications. As renewals approach, managers face the challenge of balancing cost with productivity.
Would it not be helpful to have several months of data showing the actual usage of your most expensive engineering software before making renewal decisions?
The High Cost of Engineering Software
Across industries, CAD and related tools are critical for design, simulation, and development. Many leading organizations rely on software such as CAE, CAM, EDA, ALM, MBSE, MES, PLM, AR, and VR for product innovation.
At TeamEDA, our research shows that for every 100 engineers employed, companies spend approximately $250,000 per year maintaining engineering applications. Yet when we ask engineers, managers, or directors how much of that software they actively use, most estimate less than 40% of the functionality is being utilized.
This lack of insight points to a much larger problem — most organizations are not tracking software usage effectively or managing these valuable assets strategically.
Why Many Companies Overspend
We often hear from managers who want to cut costs but lack the visibility or data to make informed decisions. Without usage reports, it becomes difficult to identify inefficiencies, negotiate renewals, or transition to more effective licensing models.
So, how are top-performing managers saving money year after year?
1. Knowing What Licenses You Have
Accurate inventory is the foundation of license management. Managers need a full understanding of:
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The number of licenses owned
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Add-on features and functionality
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Purchase types and restrictions
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Geographic limitations (such as WAN/LAN rules)
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Responsible contacts and departments
Maintaining compliance with software vendor contracts and audits (including ISO9001 or vendor-specific compliance checks) is critical. Having a centralized view of license data helps prevent oversights and ensures readiness for any audit.
2. Negotiating with Confidence
Negotiating software purchases and renewals is one of the most effective ways to reduce costs. Each vendor operates differently, with its own pricing models, discounts, and negotiation tactics.
Managers who have access to historical data, usage patterns, and vendor behavior reports are better equipped to negotiate. Understanding previous discounts, multi-year deals, and bundle structures allows for stronger discussions and better results.
3. Tracking License Usage in Real Time
Accurate license usage data is essential. However, many vendor-provided tools have limited tracking capabilities.
A specialized tool like LAMUM (License Asset Manager with Usage Monitoring) gives engineering teams visibility into:
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Real-time checkouts by vendor, feature, and user
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Long-held licenses or “hoarded” resources
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Denial rates and license availability
LAMUM also detects when engineers keep licenses active unnecessarily, such as during meetings or through idle scripts. With this insight, teams can optimize license distribution and avoid unnecessary purchases.
4. Using Historical and Batch Reports
Data-driven decision making relies on historical insights. Understanding usage trends, concurrency, and heatmaps helps identify patterns and improve license efficiency.
For instance, adjusting meeting schedules or reallocating licenses between servers could eliminate the need to buy additional licenses. Similarly, FlexLM Options files can be used to better control access and maximize utilization.
Many companies buy more licenses after receiving user complaints about denials. However, denial analysis often shows that redistribution or scheduling can resolve these issues without increasing costs.
5. Identifying What You Are Not Using
Perhaps the most overlooked opportunity for savings lies in identifying zero-use software.
Engineering software often accumulates over decades. Some tools may no longer align with current workflows, yet companies continue paying for them out of habit or uncertainty.
At TeamEDA, we frequently find organizations running two or more sets of tools (such as CAE or CFD) where newer solutions have replaced older ones. LAMUM’s Zero Usage Reports highlight these unused assets, allowing managers to confidently retire them and recover unnecessary costs.
Turning Insights into Savings
All of these techniques help managers make informed, data-backed decisions about their software investments. On average, companies using LAMUM save up to 20% annually by improving utilization and reducing waste.
TeamEDA offers a single, dedicated platform — LAMUM — that provides a complete engineering application business intelligence system. It delivers actionable insights for usage, renewals, and compliance.
LAMUM is Active Directory enabled and offers a full overview of assets, including vendor details, server locations, local administrators, and real-time usage data. Its live and historical reporting tools empower managers to develop smarter software strategies.
