Chargebacks for IT software and services can often be an emotive topic within organizations. Engineering and IT departments may have the same goal. That is to ensure efficient operations, but they often approach cost allocation from very different perspectives.
Here’s what usually happens:
-
Engineering Directors feel burdened by rising costs every year with limited visibility into how these costs are calculated.
-
IT teams understand staffing and infrastructure costs but often lack the ability to accurately assign software usage to specific users or departments, leading to blanket cost allocations.
-
Analysts and administrators spend too much time manually calculating pro-rata costs, especially with frequent staffing changes.
-
Specialist users of high-value simulation tools like FEA, CFD, or HPC are charged the same as light users who only access PLM software occasionally.
-
Department heads wish they could track running totals monthly or quarterly to better manage budgets.
These issues create friction between IT and engineering teams and can undermine trust at leadership levels.
The Challenge: Lack of Transparency in Engineering Software Usage
The main sources of confusion typically revolve around CAD, CAE, EDA, PLM, and AR/VR tools, most of which rely on floating or network-based licenses rather than named-user systems.
Traditional Software Asset Management (SAM) tools often struggle to track these engineering applications accurately. The challenge becomes even more complex with token-based licensing models (such as Altair, Siemens NX, and Simcenter), where usage fluctuates dynamically across users and modules.
Without proper visibility, IT teams resort to applying an averaged or fixed cost to all engineers – regardless of actual software usage. This approach not only leads to unfair cost distribution but also reduces incentives for optimization.
The Solution: Usage-Based Chargebacks with LAMUM
The good news? These challenges are entirely avoidable.
Organizations that follow software asset management best practices and implement a transparent license monitoring system can easily report IT costs down to the user level.
With LAMUM (License Asset Manager with Usage Monitoring), TeamEDA enables companies to calculate granular chargebacks based on actual usage across all engineering applications.
LAMUM allows you to:
-
Track license usage per user, per feature, per server.
-
Automatically calculate user-level chargeback percentages.
-
Export usage and cost data directly to Excel or through scheduled batch reports.
-
Provide daily, weekly, or monthly transparency for department heads and finance teams.
This ensures that those who use expensive tools more frequently bear a proportional share of the cost while occasional users are charged fairly.
Example: Siemens NX License Tracking
Take Siemens NX as an example.
LAMUM’s User Detail Report for the feature NX13100N (on license server NX_demo) automatically calculates the chargeback percentage for each user.
Every license file and feature tracked in LAMUM includes this level of visibility, allowing IT departments to allocate costs accurately and fairly.
Once the data is exported to Excel, an additional column can easily be added to compute individual costs by dividing usage by the annual software maintenance fee for that specific feature.
This approach can be automated for every tracked application, including CAD, PLM, EDA, and simulation tools across all license daemons.
A Clearer Picture for Budget Holders
Consider a design engineer who uses multiple tools daily: Siemens NX (CAD), Teamcenter (PLM), Mentor (EDA), ANSYS (FEA), and IBM DOORS (Requirements).
LAMUM can consolidate and calculate usage-based costs across all these products automatically – on a per-user, per-day basis.
This level of visibility helps:
-
Engineering directors plan budgets with real-time insights.
-
Finance departments monitor ROI on software investments.
-
IT teams reduce manual tracking and improve data accuracy.
It’s a win-win for both transparency and efficiency.
Why IT Chargebacks Matter
In today’s engineering landscape, cost accountability and resource transparency are vital. Without usage-based reporting, companies risk overpaying for licenses, misallocating resources, and creating tension between departments.
With LAMUM, engineering-driven organizations can ensure that:
-
Costs reflect actual tool usage.
-
Chargebacks are data-driven and auditable.
-
Budgeting becomes proactive, not reactive.
About the Author
This post was adapted from a LinkedIn article by Paul Empringham, TeamEDA’s European Sales Director, who has over 20 years of experience in engineering software, CAD, and PLM industries.
Paul has worked as a consultant with Siemens PLM and other leading manufacturers, delivering large-scale digital transformation programs. Outside of work, he is a Level 2 ECB Cricket Coach and enjoys skiing whenever the opportunity arises.
About TeamEDA
TeamEDA, Inc. is a leader in Engineering Software License Management solutions. With its flagship platform LAMUM, TeamEDA helps organizations gain complete visibility and control over expensive engineering software assets, improving compliance, cutting waste, and optimizing cost efficiency.
