A software license is a legal mechanism that sets out the terms and conditions regarding the use of a particular piece of software. Entitlement management is a system of managing how the rights to use the licensed software are assigned. For example, a large enterprise might purchase 100 licenses to a particular piece of software. Good entitlement management ensures that the software is only being used by the right people, in the right places, at the right time and therefore does not breach the terms of the software agreement.
An entitlement management solution enables software providers and system administrators to automate time-consuming, manual tasks, as well as eliminate human-error by activating and provisioning entitlements to software applications from a single platform. Typically the solution will utilise a centralised interface in order to centrally manage licenses and/or assign entitlements, therefore ensuring that licenses are managed in an efficient way.
It is possible to use an ERP or CRM system to manage things like entitlements, however, these systems are generally built to manage hardware assets – and digital assets like software are very different. You’ll most likely have to customise the systems to do things like linking assets to entitlements, tracking devices, storing activations, tracking all license and entitlement lifecycle events and dealing with data and reporting. This means high development and consulting costs in order to support the system in carrying out functions that it was not designed for.
An entitlement management system can be used by end customers, in order to provision entitlements internally and by software developers as part of a software monetization solution. When used as part of a software monetization platform, an entitlement management system will also usually allow software developers to repackage software applications and offer new feature sets in order to adapt to market changes over time or serve new customers. Modern solutions also continuously track and monitor the performance of each application to see which products or product features produce the best results. Ultimately, this helps software developers understand how customers respond to different types of licencing or feature sets, which products bring the highest revenue, and which products, if any, should be eliminated.
With an entitlement management solution in place, time-consuming manual tasks can be automated for greater accuracy and reduced costs. A self-service web portal can also allow end users to perform a variety of tasks themselves, cutting down on support calls and improving customer satisfaction.