Cost Optimization for Microsoft 365: A FinOps Framework
FinOps for Microsoft 365
Microsoft 365 is a critical technology stack for modern enterprises, yet complex licensing models, limited usage visibility, and fragmented decision-making can often lead to significant increases in spend. This authoritative guide expands the traditional FinOps Foundation Framework to explicitly address SaaS cost optimization for Microsoft 365.
It provides a structured, data-driven approach, empowering IT and procurement leaders to control SaaS spend, maximize ROI and value from Microsoft 365 investments, and drive continuous improvement, both re-actively through analytics and proactively through strategic planning.
This proven approach can enable both strategic advisory and ongoing managed services, ensuring both immediate cost savings and long-term value realization.
Purpose
This comprehensive guide is for IT and procurement leaders, FinOps and ITAM professionals, and anyone responsible for managing Microsoft 365 costs within their organization. It addresses the growing challenge of controlling SaaS spend while maximizing the return on investment for Microsoft 365.
By introducing a tailored FinOps framework for Microsoft 365, this guide offers a structured, data-driven methodology designed to achieve significant cost savings and enable continuous improvement.
By adopting the FinOps methodology for Microsoft 365, organizations can:
Reduce Microsoft 365 Spending by up to 35%:
Optimize licensing and user management, and implement proactive cost control measures to drive substantial savings on subscription licenses.Improve ROI:
By aligning Microsoft 365 spend with strategic business objectives and ensuring optimal utilization of licenses, organizations can significantly improve ROI on their cloud investments.Improve Forecasting and Budget Management:
With FinOps tools and processes, accurate forecasting of Microsoft 365 spending becomes achievable, enabling more effective budget planning and minimize unbudgeted spend at renewal.Strengthen Governance and Accountability:
Implementation of a well-defined FinOps framework can establishes clear roles, responsibilities, and processes for cost management of Microsoft 365, improving visibility, and accountability across stakeholders.Drive Data-Driven Decision-Making:
Leveraging advanced analytics and reporting, and actionable insights enables organizations to make informed decisions about licensing, usage optimization, and future investments.
Customer Challenges
Microsoft prioritizes high renewal rates for “premium” E5 suites within contracts, creating a challenge for organizations under pressure to reduce costs.
The disconnect between Procurement and IT further exacerbates this issue, putting pressure on budget justification or the need to aggressively reduce licensing costs.
As Microsoft have implemented a platform strategy of expansive licensing suites, organizations struggle with a lack of clear visibility into the breakdown and allocation of Microsoft 365 costs. Distributed accountability makes it difficult to manage spending effectively, resulting in overspending and limiting the ability to optimize costs, and leverage that information in negotiations with Microsoft.
Without accurate forecasting of future cloud spend, including achievable cost savings, organizations cannot effectively assess the impact on current budgets or make informed decisions about future cloud investments. This lack of foresight hinders strategic planning and cost control.
Challenges managing Microsoft 365 costs include:
Strategic & Financial Challenges:
Microsoft's E5 Focus & Contract Pressures: Microsoft's emphasis on driving adoption and upsell of “premium” E5 suites within contracts can create cost pressures, particularly for organizations under pressure to reduce spending. Negotiating favorable terms within Enterprise Agreements (EA) can be complex and challenging.
Procurement-IT Disconnect: Misalignment and siloed strategies between Procurement, IT, and other stakeholders hinders effective cost optimization. This disconnect makes it difficult to align licensing with business needs, to optimize the licensing bill of materials.
Lack of Cost Visibility, Allocation & Reporting: Organizations often lack clear visibility into the breakdown and allocation of Microsoft 365 products and features to business requirements. Microsoft's native reporting may not provide sufficient information on utilization across the Microsoft 365 licensing plans, or actionable recommendations. This makes it difficult to identify areas of overspend, optimize licensing or downgrade licensing plans, track cost savings against KPIs, and leverage cost-to-utilization data in negotiations with Microsoft.
Inaccurate Spend Forecasting & Budgeting: Without accurate forecasting of future cloud spend, including potential cost savings, organizations struggle to assess the budgetary impact of cloud investments and make informed decisions about future cloud strategy. This lack of foresight hinders strategic planning and cost control.
Operational & Knowledge-Based Challenges:
Knowledge Gaps & Lack of Expertise: Organizations often lack the in-house expertise and up-to-date knowledge of Microsoft 365 licensing models, best practices for cost optimization, and the technical, licensing or contract implications of various saving strategies. Gaining and maintaining this expertise requires significant time and effort.
Limited Automation & Actionable Recommendations: Microsoft's native reporting tools do not provide automated, actionable cost-saving recommendations based on Microsoft 365 utilization. Identifying suitable savings candidates, implementing savings, and measuring cost control/reduction KPIs requires manual analysis and effort.
Lack of a Formal Optimization Process & Best Practices: Many organizations lack a structured, repeatable cost optimization process, incorporating best practices and regular evaluation. This includes a consistent methodology, clear responsibilities, and regular reviews, leading to ad-hoc, inconsistent efforts.
Difficulty Identifying Optimization Candidates & Implementing Savings: Identifying suitable candidates for license downgrades, feature adjustments, or other cost-saving measures requires deep analysis and understanding of licensing and feature behavior, which is often challenging to achieve. Implementing identified savings requires technical expertise and careful consideration of potential impacts.
Measuring Optimization Success & ROI: Tracking and demonstrating the impact of cost optimization initiatives including achieved cost reduction and ROI, requires reporting and analysis which can be complex to model.
Adoption & Utilization Tracking & Alignment: Tracking advanced compliance and security feature adoption back to licensing subscriptions is often difficult. Aligning cost optimization efforts with current and planned product and feature adoption with technology roadmaps requires effective communication and collaboration between IT, Procurement, and 365 Administrators, and Resellers, which is often lacking.
Understanding Unit Economics: Understanding the cost per user vs. the value they are achieving from the licensing subscription decision (unit economics) is challenging but crucial for optimizing spending.
Technical & Management Challenges:
Limited Usage Visibility: Microsoft do not provide detailed feature activation and utilization insights across the Microsoft 365 technology stack. Identifying under-utilized license plans or over-provisioned features is challenging.
Data Silos: Critical data to inform decision-making resides in disparate systems making holistic analysis difficult.
Shadow IT: Departments procuring subscriptions outside established channels (for example cloud marketplaces) obscure overall spend, complicating optimization and increasing compliance risks.
License Assignment Challenges: Manual license assignment processes are time-consuming, and can result in assigning license suites and plans incorrectly, leading to under-utilized license plans, duplicate product coverage, or over-provisioned features.
The Evolving Landscape of Microsoft 365 Services and the Need for Cost Optimization
The growth trajectory of Microsoft's cloud offerings, while still positive, is evolving. While Microsoft 365 user subscriber growth has moderated, Microsoft is strategically focused on increasing Average Revenue Per User (ARPU). This is achieved by incentivizing organizations to adopt and expand their use of higher-tier Microsoft 365 plans, particularly the "premium" E5 suites, which bundle advanced security, compliance, and other cloud services. Azure services with per-user licensing models benefit from integration with these higher-tier Microsoft 365 plans, as security teams activate and leverage the advanced automation and AI features.
Similarly, Azure revenue growth, while robust, is also under scrutiny. Microsoft is emphasizing Azure Consumption Revenue (ACR) growth by encouraging customers to make pre-commitments to Azure consumption, “Microsoft Azure Commit to Consume” (MACC), in exchange for potentially better pricing for both Azure and Microsoft 365.
Many organizations face challenges in effectively managing their cloud spend. They often lack the time and full visibility into their Microsoft 365 service utilization to identify cost optimization opportunities throughout their contract lifecycle. Additionally, they may struggle to quantify the return on their Microsoft 365 investment. This lack of visibility and insight impacts collaborative decision-making between IT and procurement stakeholders, making it difficult to right-size contracts and optimize cloud spend.
Accordingly, the implementation of a comprehensive cost optimization process for both Microsoft 365 and Azure is crucial. This framework will empower organizations to make informed and flexible decisions regarding their cloud investments and provide them with leverage during contract negotiations with Microsoft.
A FinOps Framework for Microsoft 365
This enhanced framework builds upon established FinOps domains, explicitly targeting Microsoft 365 cost optimization. It organizes cost management capabilities into four key domains, aligning with the FinOps Framework.
Microsoft 365 FinOps Framework Overview: Capabilities and Descriptions
| Framework Domain | Capability | Capability Description |
|---|---|---|
| Understand Usage and Cost | Data Ingestion | Collect and integrate accurate data from various Microsoft 365 sources (Graph API, Entra ID, Admin Centers, etc.) to gain visibility into usage, licensing, and spending. |
| Understand Usage and Cost | Tool Evaluation and Selection | Assess and choose appropriate tools (third-party, native) to enhance data collection, analysis, and automation for Microsoft 365 cost management. |
| Understand Usage and Cost | Allocation | Assign Microsoft 365 costs to relevant business units, departments, or projects to understand cost drivers and improve accountability. |
| Understand Usage and Cost | Reporting and Analytics | Generate reports and perform analysis on Microsoft 365 usage, licensing, and spending to identify optimization opportunities and track progress. |
| Quantify Business Value | Budget and Forecasting | Establish budgets and track actual spending against short- and long-term forecasts, developing baseline and optimized forecasts to inform strategic planning and EA negotiations. |
| Quantify Business Value | Planning and Estimating | Align technology roadmaps with license demand by assessing organizational goals, projected user growth, and upcoming projects, using usage-based optimization analysis and cross-functional alignment. |
| Quantify Business Value | Solution Alignment | Understand cross-functional business requirements through stakeholder engagement, mapping required Microsoft 365 services and features to associated license subscription plans. |
| Quantify Business Value | User Technology Profiles | Define user requirements based on roles and capabilities to inform license selection and planning, categorizing user profiles for efficient license assignments. |
| Quantify Business Value | Baseline Cost Modelling | Evaluate cost modeling of licensing suites and plans, starting with baseline costs and as-is renewal forecasts, to inform predictive cost modeling and rate optimization strategies. |
| Optimize Cloud Usage and Cost | User Lifecycle Analysis | Analyze user data from Entra ID to understand user status and login frequency, identifying inactive and disabled users to optimize licensing and service assignments, and implementing automated user deactivation. |
| Optimize Cloud Usage and Cost | Usage Based Optimization | Implement strategies to optimize Microsoft 365 usage by identifying and addressing underutilized features, redundant services, and inefficient workflows through service utilization analysis. |
| Optimize Cloud Usage and Cost | Rate Optimization | Refine the structure of Microsoft 365 licensing (Licensing Optimization) and secure favorable financial terms (Pricing Optimization) through strategic selection of suites, add-ons, tiers, and negotiation of discounts, volume flexibility, and reseller margins. |
| Optimize Cloud Usage and Cost | Cost Optimization Initiatives | Implement specific tactical methods to optimize costs, and “right-size” of licensing subscription suites and plans, including User and Access Management, Licensing Optimization, Pricing Optimization, and Policies and Automation. |
| Establishing and Managing a FinOps Practice for Microsoft 365 | Alignment and Education | Establish a cross-functional FinOps team, define roles and responsibilities, and deliver targeted training on Microsoft 365 licensing and cost optimization. |
| Establishing and Managing a FinOps Practice for Microsoft 365 | FinOps Assessment for Microsoft 365 | Conduct periodic evaluations of FinOps framework maturity and effectiveness for Microsoft 365, tracking key metrics and gathering stakeholder feedback. |
| Establishing and Managing a FinOps Practice for Microsoft 365 | Strategic Alignment Workshops | Define cost optimization objectives, priorities, and success metrics with stakeholders, aligning with overall business and technology goals. |
| Establishing and Managing a FinOps Practice for Microsoft 365 | Cost Optimization Process | Implement a structured, repeatable cost optimization process for Microsoft 365, including baseline analysis, periodic reviews, and tracking of initiatives. |
| Establishing and Managing a FinOps Practice for Microsoft 365 | FinOps Practice Governance | Establish KPIs, track performance, analyze strategy, review the operating model, and establish a regular governance cadence for the Microsoft 365 FinOps practice. |
| Establishing and Managing a FinOps Practice for Microsoft 365 | Tooling and Automation | Evaluate and select appropriate Microsoft 365 management tools, onboard and integrate them with data sources, and implement automated controls for licensing and cost optimization, including automated license assignments and scaling. |
| Establishing and Managing a FinOps Practice for Microsoft 365 | Reporting and Communication | Continuously monitor Microsoft 365 usage, costs, and savings opportunities, generating regular reports and communicating progress to stakeholders. |
FinOps Domains
The Microsoft 365 FinOps framework is structured around a logical topology that organizes cost optimization efforts into distinct domains. Each domain represents a key area of focus, and within these domains, specific capabilities are defined. These capabilities are the actionable steps and processes that enable effective cost management. For instance, the 'Understand Usage and Cost' domain encompasses capabilities like 'Data Ingestion' and 'Allocation,' which are essential for gaining visibility into spending and usage patterns. By mapping these capabilities to their respective domains, organizations can establish a clear framework for implementing FinOps practices, ensuring a systematic and comprehensive approach to optimizing Microsoft 365 costs.
1.Understand Usage and Cost
This domain informs full visibility into Microsoft 365 consumption and accurate cost visibility, cost allocation, and provides the data layer for optimization and continuous improvement.
Data Ingestion
Effective cost optimization for Microsoft 365 depends on the integration of accurate, comprehensive data from multiple sources.
The following data sources are essential for gaining visibility into usage, licensing, spending and pricing, enabling informed decision-making. These sources fall broadly into four main categories: Microsoft product data, license entitlement data, pricing information, and additional supporting systems.
The information can be challenging to obtain, the list below provides a good starting point of what you will need.
Microsoft Product Data
Microsoft 365 Admin Center Reports:
Supplies built-in reports that offer a centralized view of product usage and trends across Microsoft 365 services. These reports help monitor key performance indicators.Microsoft365 Compliance Center:
Provides visibility into the activation and enforcement of tenant-wide security and compliance policies in Microsoft Purview and Microsoft Defender portfolios. Microsoft portals are essential for tracking the utilization of advanced security features (often included in E5 plans) and ensuring that compliance controls are effectively implemented across the organization.Microsoft Graph API:
Provides granular data on user activity, feature utilization, license assignments, and application usage. This data is essential for understanding how users interact with Microsoft 365 services and identifying trends in usage patterns. It is commonly used as a data source in third-party tooling.
License Entitlement
Microsoft 365 Admin Center:
Provides information on the licenses owned by the organization for various Microsoft 365 subscriptions, helping to track current entitlements and assignments.Microsoft License Statement (MLS):
Delivers a comprehensive historical record of licensing information, which aids in understanding long-term licensing entitlement history over time.Entra (Azure AD) Reporting
Offers insights into user sign-ins, group memberships, and license assignments, along with other identity-related information. It is crucial for detecting inactive accounts that are licenses for Microsoft 365, managing user access, and automating license management workflows. Additionally, Entra AD data supports security and compliance by revealing policy activations and enforcement, which help ensure that tenant-wide security features are properly deployed.
Pricing
Microsoft Price Files: Pricing data from Microsoft price files can inform alternative licensing options and pricing of planned Microsoft 365 services. For organizations working with a Partner, these files offer detailed pricing information for various Microsoft 365 plans and services, enabling cost comparisons and informed purchasing decisions. (Please be aware the respective partner could have margin applied if it is an indirect contract).
Contract: Microsoft provide Customer Price Sheets (CPS) for the Microsoft Enterprise Agreement (EA). This provides a detailed list of products and quantities included in the initial contract commitment, and current, and future years pricing, including ‘true up’ pricing.
Cloud Solution Providers (CSP): CSPs are responsible for providing reporting on license entitlement, order history, and licensing costs for customers purchasing through them. The CSP will commonly include value-added services like support as part of the service fee included within the margin. Access is commonly provided through an online platform.
Third Party Systems
Third-Party Microsoft 365 Management / ITAM Tools:
These tools enhance visibility into product usage, licensing assignments, license compliance, and overall optimization opportunities, by offering advanced analytics and licensing automation capabilities beyond native Microsoft reporting.IT Service Management (ITSM) Systems:
ITSM systems link license usage to specific user roles, departments, or projects, providing context that is essential for identifying optimization opportunities and making targeted improvements based on user technology profiles.Human Resources (HR) Systems:
HR systems can support automation of license management based on employee status, which are critical for dynamic license reclamation, leveraging not only on user “last accessed” data for products, but corroborated accurately against employee status.
A comprehensive data framework not only supports real-time decision-making but also ensures that all cost management efforts are grounded in accurate, actionable insights, forming the foundation of an effective, data-driven cost optimization strategy.
This can be further supported by specialized FinOps tooling that extends beyond Microsoft Azure, Google Cloud Platform and AWS, to cover Microsoft 365:
Tool Evaluation and Selection:
Choose appropriate Microsoft 365 tooling / ITAM tooling with comprehensive Microsoft 365 capabilities. This supports both the “Understand Usage and Cost” and the "Optimize Usage and Cost" domains in the FinOps framework.
Evaluate and select appropriate Microsoft 365 management tools to automate license tracking, usage monitoring, reporting, and cost optimization. Consider factors such as Microsoft 365 product coverage, functionality, integration capabilities, ease of use, and cost.
For example, a leading provider in this space is Surveil. I have seen this used successfully in client consulting engagements, and I have evaluated the product as product manager for Microsoft and FinOps consulting services.
Increasingly, tool providers and consultants are also looking at the ROI and value achieved from Microsoft 365, and applying unit economics to inform the understanding the cost per user vs. the value they are achieving from the licensing subscription decision.
Visibility
Providing stakeholders with visibility of Microsoft licensing and utilization are important foundational capabilities for managing Microsoft 365. Including, but not limited to:
License Entitlement: Reporting can provide clear visibility of Microsoft 365 license entitlement. it is useful to review current composition of Microsoft 365 licensing suites, plans and quantities.
Assigned Licenses: This can inform current license entitlement, current assignment allocation, and unassigned license quantities to identify opportunities for cost reduction.
Total Spend: This can inform the total cost of subscriptions for Microsoft 365. This can be mapped to individual suites or plans, business units, or subsidiaries.
Contract Visibility: Understanding current contract types, and upcoming renewal date(s) is critical to inform renewal planning, anniversary dates, and reporting requirements.
Licensing Cost: Reporting can provide clear visibility of the individual cost of Microsoft user license subscriptions. This cost can be variable, based on currency, contract type, programmatic discounts for volume commitment, negotiated discount or reseller margin.
Product Entitlement: Visibility of current product entitlement associated with purchased user license subscriptions. A Microsoft user license subscription suite or plan can correspond to a plethora of products and associated features.
User Status: Microsoft Entra (formerly Active Directory) and HR systems can inform visibility into active, inactive and disabled user accounts.
Product Utilization: Visibility of activated Microsoft products and usage by licensed users.
Tenant-Wide Service Activation: Tenant-wide services, by Microsoft's definition, are online services that, upon activation, become operational across the entirety of a Microsoft 365 tenant. This means the service’s foundational infrastructure and certain core functionalities are inherently enabled for all users within the organization's digital environment, regardless of individual license assignments.
Allocation
A good FinOps tool (or FinOps AI Agent) can map Microsoft 365 costs and licensing subscription plans to specific business units/departments/user profiles, using charge-back / show-back models.
Allocation of current cloud costs back to the business informs what business units, departments, and user technology profiles are driving spend, enables tracking of actual spend variance to budgets, and enables collaboration across procurement and IT stakeholders to justify current expenditure or implement cost savings.
Understanding cost drivers. By highlighting detailed license and service consumption, allocated back to line-of-business and departments/functions can inform some of the key cost drivers for growth in Microsoft 365 spend.
Reporting and Analytics
A good FinOps tool (or FinOps AI agent) can generates reports and dashboards to visualize spending trends, track key metrics, and identify cost-saving opportunities and realized cost savings.
The Data Layer
The table below provides an overview of data sources, mapped to the capability they enable, and the primary/supporting outcomes. This can help inform why data is being asked for and support stakeholder buy-in. Data is key to a fact-based discourse for decision making.
Microsoft 365 FinOps Framework: Data Source to Capability Mapping
| Data Source | Enabled Capability | Primary Outcome | Supporting Outcomes |
|---|---|---|---|
| Microsoft Graph API | Usage Based Optimization | Usage Optimization: Identify usage patterns, inform license right-sizing, pinpoint underutilized features. | - License Downgrades: Detect users with underutilized licenses. - Feature Rationalization: Identify redundant or unused features for deactivation. - User Lifecycle Management: Correlate activity with user status. |
| Microsoft Graph API | User Lifecycle Analysis | Usage Optimization: Identify usage patterns, inform license right-sizing, pinpoint underutilized features. | - License Downgrades: Detect users with underutilized licenses. - Feature Rationalization: Identify redundant or unused features for deactivation. - User Lifecycle Management: Correlate activity with user status. |
| Entra (Azure AD) Reporting | User Lifecycle Analysis | User Lifecycle Management: Identify inactive/disabled users, automate license management workflows. | - License Removal: De-provision licenses from inactive/disabled accounts. - Access Control: Manage user access, enforce security policies. - Security & Compliance: Monitor policy activations and enforcement. |
| Entra (Azure AD) Reporting | Access Control | User Lifecycle Management: Identify inactive/disabled users, automate license management workflows. | - License Removal: De-provision licenses from inactive/disabled accounts. - Access Control: Manage user access, enforce security policies. - Security & Compliance: Monitor policy activations and enforcement. |
| Microsoft 365 Admin Center Reports | Licensing Optimization | Licensing Optimization: Monitor KPIs, support cost analysis, track license entitlements. | - License Right-Sizing: Inform decisions on optimal license suites. - Trend Analysis: Identify usage and licensing trends. |
| Microsoft 365 Admin Center Reports | Reporting and Analytics | Licensing Optimization: Monitor KPIs, support cost analysis, track license entitlements. | - License Right-Sizing: Inform decisions on optimal license suites. - Trend Analysis: Identify usage and licensing trends. |
| Microsoft 365 Compliance Center | Security & Compliance Optimization | Security & Compliance Optimization: Track advanced security feature utilization, ensure compliance control implementation. | - E5 Feature Utilization: Verify value of advanced security features. - Policy Enforcement: Ensure effective implementation of compliance controls. |
| Microsoft 365 Compliance Center | Reporting and Analytics | Security & Compliance Optimization: Track advanced security feature utilization, ensure compliance control implementation. | - E5 Feature Utilization: Verify value of advanced security features. - Policy Enforcement: Ensure effective implementation of compliance controls. |
| Microsoft 365 Admin Center (License Information) | License Entitlement Tracking | License Entitlement Tracking: Track current license entitlements. | - License Inventory: Maintain an accurate record of owned licenses. |
| Microsoft 365 Admin Center (License Information) | Reporting and Analytics | License Entitlement Tracking: Track current license entitlements. | - License Inventory: Maintain an accurate record of owned licenses. |
| Microsoft Volume Licensing Service Center (VLSC) | Planning and Estimating | License Entitlement & Procurement Optimization: Manage agreements, gain insights into purchase history. | - Agreement Management: Track and manage Enterprise Agreements. - Historical Analysis: Understand past licensing decisions. |
| Microsoft Volume Licensing Service Center (VLSC) | Procurement Optimization | License Entitlement & Procurement Optimization: Manage agreements, gain insights into purchase history. | - Agreement Management: Track and manage Enterprise Agreements. - Historical Analysis: Understand past licensing decisions. |
| Microsoft License Statement (MLS) | Planning and Estimating | Historical License Entitlement Analysis: Understand long-term licensing entitlement history. | - Trend Identification: Identify long-term licensing trends. - Audit Support: Provide historical records for audits. |
| Microsoft License Statement (MLS) | Historical Analysis | Historical License Entitlement Analysis: Understand long-term licensing entitlement history. | - Trend Identification: Identify long-term licensing trends. - Audit Support: Provide historical records for audits. |
| Microsoft Price Files | Budget and Forecasting | Pricing Optimization: Inform alternative licensing options, enable cost comparisons. | - Discount Negotiation: Support negotiation of favorable pricing. - Cost Modeling: Model potential cost savings. |
| Microsoft Price Files | Pricing Optimization | Pricing Optimization: Inform alternative licensing options, enable cost comparisons. | - Discount Negotiation: Support negotiation of favorable pricing. - Cost Modeling: Model potential cost savings. |
| Third-Party Microsoft 365 Management/ITAM Tools | Tool Evaluation and Selection | Advanced Licensing & Usage Optimization: Enhance visibility, automate licensing, provide advanced analytics. | - License Compliance: Ensure compliance with licensing agreements. - Automation: Automate license management tasks. |
| Third-Party Microsoft 365 Management/ITAM Tools | Advanced Licensing Optimization | Advanced Licensing & Usage Optimization: Enhance visibility, automate licensing, provide advanced analytics. | - License Compliance: Ensure compliance with licensing agreements. - Automation: Automate license management tasks. |
| IT Service Management (ITSM) Systems | User Technology Profiles | Contextual Usage Optimization: Link usage to business context, identify targeted improvements. | - User Technology Profiling: Align licenses with user roles and needs. - Optimization Opportunities: Identify targeted improvement areas. |
| IT Service Management (ITSM) Systems | Contextual Usage Optimization | Contextual Usage Optimization: Link usage to business context, identify targeted improvements. | - User Technology Profiling: Align licenses with user roles and needs. - Optimization Opportunities: Identify targeted improvement areas. |
| Human Resources (HR) Systems | User Lifecycle Analysis | Automated License Reclamation & User Lifecycle Management: Automate license management based on employee status. | - Dynamic License Management: Reclaim licenses based on real-time employee status. - User Status Validation: Corroborate user activity with HR data. |
| Human Resources (HR) Systems | Automated License Reclamation | Automated License Reclamation & User Lifecycle Management: Automate license management based on employee status. | - Dynamic License Management: Reclaim licenses based on real-time employee status. - User Status Validation: Corroborate user activity with HR data. |
2. Quantify Business Value
The 'Quantify Business Value' domain is critical in aligning Microsoft 365 spend with strategic objectives, transforming technology investments into measurable business value.
It bridges the gap between data-driven insights and actionable cost optimization by leveraging robust forecasting, strategic budgeting, and proactive planning. This domain emphasizes a holistic approach, where senior stakeholder vision and technology roadmaps are harmonized with current utilization and planned adoption.
Accurate forecasting, encompassing both baseline and optimized projections, is essential for proactive budget management and informed EA negotiations. Budgeting strategies, ranging from centralized to decentralized and hybrid models, ensure financial accountability and cost efficiency, particularly in complex scenarios like M&A and portfolio company management.
Central to this process is meticulous planning and estimating, grounded in usage-based optimization analysis and cross-functional alignment. This involves defining user technology profiles, aligning solutions with business requirements, and designing licensing schemas that support planned adoption.
Proactive license design, integrated into enterprise architecture frameworks, ensures that licensing considerations are embedded in technology initiatives from the outset, enabling scalable and cost-effective cloud investments. Ultimately, this domain empowers organizations to make data-informed decisions, optimize spending, and maximize the business value derived from their Microsoft 365 investments
Forecasting and Budget Management
Forecasting
Forecasting projects future Microsoft 365 expenditures, enabling proactive budget management and strategic decision-making. It involves establishing budgets and tracking actual spending against both short-term and long-term forecasts.
Baseline Forecast: Developing a "baseline" forecast begins with reviewing the initial contract commitment, current spend over the contract term (including additional orders and true-ups), and an "As-Is" renewal forecast based on current-state entitlement and business requirements.
This analysis provides a clear picture of current spend, allowing IT stakeholders to identify potential areas for cost reduction and develop right-sized investment plans.
Accurate baseline forecasts are essential for understanding minimum commitment requirements in advance of Microsoft EA negotiations.
This process requires a detailed review of current license entitlements, utilization, and application usage, broken down by lines of business (LOBs) or subsidiaries.
For decentralized organizations, each LOB should contribute to the baseline forecast, reflecting their specific needs and projected growth.
Optimized Forecast: An "optimized" forecast builds upon the baseline by incorporating potential cost savings from rate optimization strategies and planned cost optimization initiatives.This includes factoring in planned changes like new projects, user growth, or M&A activities.
The optimized forecast highlights the intersection and dependency on Rate Optimization (See “Rate Optimization” below), including negotiated and programmatic discounts and the Microsoft 365 technology roadmap. (See “Planning and Estimating” below)
It is enabled through accurate planning and estimating, both re-actively through analytics and proactively through strategic planning, and the outputs of the "License Design for Cloud Architecture" for IT projects and programmes.
For hybrid environments, this involves the roll up of LOB specific optimized forecasts, with the centrally managed optimized forecast.
Portfolio Companies: For portfolio companies, forecasting should allow for individual company flexibility while aligning with the overall portfolio strategy.
Establish a framework for forecasting that considers the unique needs of each portfolio company. For example, a software development company may have a higher demand for advanced security features, while a retail company may prioritize Teams and customer-facing applications.
Provide portfolio companies with access to shared services and best practices. This can help them develop accurate forecasts and identify potential cost savings.
Based on the ownership structure, when forecasting, consider the overall portfolio's purchasing power. By aggregating license demand across all portfolio companies, you may be able to negotiate better pricing with Microsoft. This is most effective when the portfolio companies are under a unified ownership structure or a common holding company that facilitates aggregated purchasing.
Allow for individual portfolio companies to forecast their own application specific licensing needs, such as power platform, or project online, while the parent company may forecast the core Microsoft 365 E3/E5 licensing.
M&A Impact: Integrate the acquired company's spending and usage data into the parent company's forecast, accounting for potential overlaps and redundancies.
Factor in potential cost savings from consolidation. This could involve migrating users to the parent company's existing tenant, eliminating redundant licenses, and optimizing storage by consolidating SharePoint sites.
Budgeting
This section outlines Microsoft 365 budgeting strategies, covering centralized, decentralized, and hybrid models, alongside specific considerations for M&A and portfolio companies. The focus is on optimizing costs through tailored approaches, strategic integration, and balancing standardization with flexibility.
Centralized Budgeting: In a centralized budgeting model, a central IT department assumes responsibility for managing all Microsoft 365 expenditures, often leveraging volume purchasing to achieve cost savings through programmatic and negotiated discount. The central IT team constructs a comprehensive budget, using allocation or showback or chargeback mechanisms to distribute expenses to individual lines of business (LOBs) or subsidiaries based on their usage.
Forecasting is a central IT function, informed by data gathered from each LOB regarding planned changes. To ensure success, usage tracking, and consistent communication with LOBs are recommended.
Decentralized Budgeting: Conversely, decentralized budgeting empowers individual LOBs or subsidiaries to manage their Microsoft 365 budgets and service deployments autonomously. This approach allows for tailored configurations to meet the specific needs of each business unit. It is prevalent in organizations with diverse business units, global footprints, or those formed through mergers and acquisitions. Each LOB independently crafts its budget, and provides baseline and optimized forecasts that are rolled up into the overall M365 forecast, while central IT may provide guidelines and best practices. Robust monitoring, reporting tools, and knowledge-sharing platforms are essential for maintaining oversight.
Hybrid Approach: Many organizations strike a balance between centralized control and decentralized management within Microsoft 365, particularly when it comes to budgeting. The central IT team typically manages the budget for core Microsoft 365 licensing, covering foundational licenses like E3/E5, and enforces organization-wide security protocols such as MFA, DLP, and Intune device management, ensuring a secure and consistent foundation.
The central IT team also manages the core SharePoint Online structure and overall tenant settings, providing a standardized and secure environment. From a budgeting perspective, this centralized control of core licenses and security protocols provides a stable and predictable cost base.
Conversely, individual lines of business (LOBs) gain budgetary autonomy for application-specific configurations and licenses. For example, marketing might manage its own budget for Power BI Pro licenses, aligning spending with campaign analytics needs, while a project management team manages its budget for Microsoft Project Online licenses and configurations, tailored to specific project workflows.
This decentralized budgeting allows LOBs to control costs associated with specialized applications and specific needs, while central IT ensures essential security and foundational services are consistently funded and managed. This hybrid model delivers essential standardization and security while empowering departments to tailor Microsoft 365 to their unique operational needs and budgetary constraints.
M&A Considerations: Mergers and acquisitions significantly impact Microsoft 365 budgeting, requiring a focused approach to financial integration. Before any budget adjustments, a crucial step is to establish a detailed baseline of the acquired company's existing Microsoft 365 license entitlement, spending and usage. This includes analyzing their current Microsoft 365 suite licensing costs, storage expenses, and application-specific spending.
With this baseline, a strategic integration plan can be developed, directly addressing budgeting implications. This plan should aim to align licensing costs by consolidating to the parent company's standards, eliminate redundant subscriptions, and identify cost optimizations.
Critically, leveraging the joint purchasing power through spend aggregation and increasing volume commitments can significantly impact price optimization strategies. This includes pursuing both programmatic and negotiated discounts with Microsoft.
Accurate budgeting and forecasting post-acquisition will be dependent on a thorough review of current and planned Microsoft technology roadmaps. The goal is to achieve cost efficiencies through consolidation and standardization, ensuring a clear and predictable budget moving forward, while simultaneously maximizing the financial benefits of the combined entity's scale.
Portfolio Companies: For organizations comprised of a portfolio of companies, Microsoft 365 budgeting requires a framework that aligns with the overall portfolio strategy. This framework should provide portfolio companies with access to shared resources and best practices, while allowing for individual company flexibility in service configurations to meet their unique operational needs. A balance between standardization and autonomy is crucial to ensure both cost efficiency and the ability of each company to adapt to its specific market and operational environment.
Planning and Estimating
A key precursor to this phase is Usage-Based Optimization Analysis. This requires cross-functional alignment of current-state usage of Microsoft 365 services, and current and planned adoption of services mapped to license demand, to inform the Microsoft 365 technology roadmap, and rate optimization strategy. This process should incorporate insights and recommendations based on service usage analysis, service activation analysis, storage analysis, and a review of application consolidation.
The cross-functional alignment of stakeholders can inform current and planned adoption of solutions, and associated timescales, to ensure business and technology requirements are met. This involves understanding the needs of different departments and aligning them with the capabilities of the associated licensing suite(s) and plan(s).
Additionally, an informed view of user technology profiles within the organization can be mapped to licensing suites and plans, and custom licensing user-profiles developed for group-based license assignments. Use these profiles to determine the most appropriate Microsoft 365 licensing plan(s) for each role.
This can enable fact-based decision making to inform the rate optimization strategy: Alignment of technology roadmaps with license demand by assessing organizational goals, projected user growth, and upcoming projects. This includes:
Baseline Cost Modelling
Evaluate cost modelling of licensing suites and plans. This involves analysis of the various licensing suites and plans to identify the most cost-effective options for different user groups. (This intersects with Budget and Forecasting, and Planning and Estimating)
A good start point includes:
Baseline Costs: Start with cost modelling the spend for initial contract commitment, and the current spend over the contract term based on current license entitlement. This provides stakeholders with a view of total current user subscription totals, total spend, assigned to line-of-business. This might be broken down by business units, or geography based on organization structure and how budgets are assigned.
As-Is Renewal Forecast: This can be powerful to get alignment and focus from stakeholders. This informs the predictive cost of the upcoming contract renewal. This can often exclude current negotiated discounts, providing the as-is renewal costs of current license subscriptions and/or maintenance.
Once you have a view of current-state, you can start with predictive cost modelling based on current and planned procurement and utilization of technology to inform the future-state business requirements, and inform the scope for rate optimization.
Solution Alignment
Solution Alignment for Microsoft 365: Understanding cross-functional business requirements through stakeholder engagement, reviewing current and planned adoption, licensing entitlement, and identifying gaps and opportunities.
This is effectively demand management, informing current and planned business and technology requirements with stakeholders, and mapping required Microsoft 365 services and features to associated license subscription plan(s). The output should be a Microsoft 365 technology roadmap, with planned roll-outs over the contract term.
User Technology Profiles
User Profiling: Stakeholders should define requirements based on roles and capabilities to inform license selection and planning.
By categorizing user profiles based on job function, security needs, and collaboration requirements, organizations can optimize their Microsoft 365 licensing strategy while ensuring users have access to the tools they need.
A modular approach to assigning licenses allows flexibility in applying the right mix of features without over-provisioning, ultimately reducing unnecessary costs.
Developing a nuanced understanding of how different user groups utilize services to enable precision in license allocation:
Usage Pattern Clustering: Analyze usage data to identify natural clusters of users with similar usage patterns, creating user technology profiles that can inform standardized license assignments.
Role-Based License Mapping: Develop standardized license ‘user profile’ templates aligned to organizational roles based on typical usage patterns and technical requirements of each position.
Creator vs. Consumer Segmentation: Distinguish between users who actively create content/solutions (requiring higher-tier licenses) versus those who primarily consume (potentially covered by basic licenses or viewer capabilities).
Expertise-Based Tiering: Identify power users with advanced needs versus casual users who require only basic functionality, allocating premium licenses to maximize organizational capability development.
Security-Based Tiering: Identify executives and IT personnel with advanced security requirements, allocating advanced E5 functionality to improve security posture.
License Design for Cloud Architecture
Proactive license design is essential for optimizing costs and ensuring alignment with cloud architecture. Rather than reacting to license needs after solutions are implemented, licensing should be a core component of the initial architecture planning. This involves:
Integrating License Considerations into Solution Architecture: When designing cloud solutions, consider the licensing implications of each component. For example, using premium features in Power Platform or Azure Entra (AD) might require specific licenses.
Mapping Business Requirements to Licensing: Translate business needs into specific license requirements. This ensures that the chosen licenses provide the necessary functionality without overspend.
Anticipating Future Needs: Design license strategies that can scale with the organization's growth and evolving technology requirements. This includes planning for potential increases in user numbers or the adoption of new services.
Optimization Through Architectural Review: Regularly review cloud architectures to identify opportunities for license optimization. This can involve consolidating services or switching to more cost-effective licensing options.
License Design in Enterprise Architecture Frameworks: License design should be integrated into the organization's enterprise architecture framework. This ensures that licensing considerations are consistently applied across all technology initiatives.
Integration with Enterprise Architecture Frameworks
The planning and estimating process, including license design, fits seamlessly into enterprise architecture frameworks. For example:
TOGAF (The Open Group Architecture Framework): License design can be incorporated into the Architecture Development Method (ADM) at various stages, from business architecture to technology architecture.
By incorporating license design into enterprise architecture, organizations can ensure that their cloud investments are aligned with business goals, cost-effective, and scalable. This proactive approach helps to avoid unexpected license costs and ensures that the organization is making the most of its Microsoft 365 investment.
3. Optimize Cloud Usage and Cost
The 'Optimize Cloud Usage and Cost' domain represents the core of the FinOps Framework Lifecycle 'Optimize' phase, focusing on the strategic implementation of tactical methods to right-size Microsoft 365 licensing and drive cost efficiency. This is a dynamic process of continuous analysis, review, recommendation, and implementation, ensuring Microsoft 365 services are utilized efficiently and aligned with actual business needs.
This domain encompasses a range of strategies, including user lifecycle analysis to eliminate inactive licenses, usage-based optimization to align licensing tiers with actual usage patterns, and rate optimization to secure optimum licensing bill of materials, pricing, and commercial terms.
By leveraging data-driven insights, organizations can identify and eliminate overspend, and negotiate optimal pricing through programmatic and negotiated discounts, contract optimization, and reseller margin adjustments.
This proactive approach ensures that every aspect of Microsoft 365 utilization is optimized for both performance and cost-effectiveness, driving realized cost savings, cost avoidance, and maximizing the return on technology investments
Usage-Based Optimization
User Lifecycle Analysis
User Lifecycle Analysis is a critical process that leverages Microsoft Entra ID data to understand user status and login frequency, directly informing decisions related to service activation, usage optimization, and cost reduction. It involves a detailed examination of user activity within the Microsoft 365 environment, focusing on identifying inactive and disabled users within Entra ID. By analyzing this data, organizations can pinpoint underutilized licenses, streamline user provisioning and de-provisioning, and ensure that service assignments align with actual user needs.
The insights gained from Entra ID analysis provide a fact-based foundation for licensing optimization and optimizing feature deployments, and implementing efficient user lifecycle management processes, all contributing to significant cost savings.
Identify Disabled Users: Use the Microsoft Entra admin center or PowerShell scripts to identify users who have been disabled in Entra ID. This includes users whose accounts have been deactivated due to termination or other reasons
Identify Inactive Users: Establish criteria for what constitutes an inactive user. Commonly, users who have not signed in for 60-90 days are considered inactive.
Use the Microsoft Entra admin center or Microsoft Graph API to find the last sign-in date for all users. This helps in identifying users who have not been active within the defined time-frame.
Create reports to list inactive users. This can be done using PowerShell scripts or Microsoft Graph API queries.
User Service Utilization: Identify which users are actively using services and features. This helps in understanding user engagement and identifying potential areas for optimization.
Cross-Reference with License Assignments: Cross-reference the list of inactive or disabled users with the list of licensed users to identify those who still have licenses assigned.
Usage Analysis
Identify under-utilized products or features within higher-tier licensing suites and plans. Analyze feature usage to identify potential downgrades for over-provisioned users. This can include user activity and feature utilization data to identify users assigned higher-tier licenses (e.g., E3, E5) when their actual usage aligns with lower-tier plans (e.g., E1). Identify potential downgrade for these users to the appropriate license level to reduce costs. This allows for targeted downgrades or the strategic use of add-ons rather than broad, expensive deployments of E5 suites.
This can include:
User Activity Assessment: Analyze user interaction frequency with product features across applications. For example, measuring the number of Power Automate flow runs per user, PowerBI report views per user, or Copilot interactions per week to establish usage thresholds that justify premium licensing costs.
Role-Based Utilization: Examine usage patterns by role to identify user technology profiles that benefit most from product or feature capabilities. This includes mapping which organizational roles generate highest ROI from premium features (content creators with Copilot, data analysts with PowerBI Premium) versus roles that can function effectively with basic license tiers.
Feature Adoption Tracking: Inventory which capabilities are being actively used across the organization, highlighting underutilized features. For example, tracking which PowerBI Premium-only features (paginated reports, AI capabilities, larger datasets) are actually being leveraged, or which premium connectors in Power Platform are actively used.
Integration Point Evaluation: Assess whether users have activated and are utilizing integrations across all available touch-points. Measure if premium license holders are using features across multiple applications (For example, Copilot across Word, PowerPoint, Teams) or primarily in a single context, which may not justify the full license cost.
Adoption Barrier Identification: Identify departments or teams with low product adoption despite having licenses, signaling potential training needs or workflow misalignment. This helps distinguish between genuine lack of need versus adoption barriers that prevent value realization.
Consumption Pattern Monitoring: Track usage volume over time to identify cyclical patterns or trends that might inform dynamic license allocation. This could include monitoring seasonal usage peaks for potential temporary license scaling rather than year-round provisioning.
Service Activation Analysis
Identifies services within license plans that have not been activated or utilized. This helps optimize costs and improve compliance by ensuring that only necessary services are active.
List All Services: Create a comprehensive list of all services included in premium license plans. This includes security and compliance services in Microsoft 365 E5 (Microsoft Defender, Microsoft Purview, Entra ID P2), advanced features in Power Platform (AI Builder, RPA), and premium capabilities in PowerBI (XMLA endpoints, deployment pipelines).
Activation Status Check: Check the activation status of each service and feature. Identify which services have not been activated or configured.
Identify Inactive Services: Identify services that have not been activated or show no usage data. For example, if tenant-wide features like Microsoft Defender for Identity, PowerBI deployment pipelines, or Power Platform data policies are included in your plan but remain inactive, they represent untapped value.
Feature Configuration Audit: Verify that activated features are properly configured for optimal value. Partially implemented premium features may not deliver the expected ROI and could indicate the need for either full implementation or license downgrade.
Application Rationalization
Identify and review consolidation of redundant or under-utilized applications that overlap with Microsoft 365 technology stack.
This process includes evaluating both third-party applications and Microsoft products to ensure that only necessary and cost-effective solutions are in use. Here are the steps to conduct application rationalization:
List all Services: Create a comprehensive list of all third-party applications currently in use within the organization that map to Microsoft 365 services.
Identify Redundancies: Look for applications that provide overlapping functionalities.
Assess Business Needs: Evaluate the necessity of each application based on business needs and user requirements. Determine if the features provided by each application are essential for your organization (see Solution Alignment and User Technology Profiling below)
Evaluate Alternatives: Consider third-party alternatives that might offer better value or more suitable features than current Microsoft products.
Technical Capacity Optimization
Resource Utilization Analysis
Resource Utilization Analysis examples how efficiently technical resources provided within license tiers are being utilized, identifying opportunities to right-size capacity-based licensing:
Storage Consumption Assessment: Analyze storage usage across Microsoft 365 services, including such as SharePoint, OneDrive, Power Platform environments, and Power BI workspaces in relation to allocated capacity. Identify opportunities for consolidation or redistribution to prevent over-provisioning and optimize costs.
Accordingly, if storage under a Microsoft 365 E3 plan is consistently below its limits, there's no need for costly storage add-ons or upgrading to an E5 plan solely for extra capacity. For example, If a SharePoint site on Microsoft 365 E3 uses only 50% of its allocated storage, indicating potential for content consolidation rather than purchasing additional capacity.
Processing Capacity Utilization: Measure computational resource usage against provisioned capacity, especially for “premium” services. This includes assessing workloads on Power BI Premium capacities (P-SKUs), Power Platform environments, and API call volumes to ensure that the level of service matches business needs.
For example, Power BI offers two primary licensing options: Power BI Pro, which uses a shared capacity model suitable for everyday reporting and interactive dashboards, and Power BI Premium, which provides dedicated capacity for higher performance, larger datasets, and more frequent refreshes. If your Power BI Premium capacity is running at only 40% utilization during peak times—well below a typical technical performance threshold of around 70%—this indicates that your workload may not fully require the dedicated resources of Premium. In such cases, switching to Power BI Pro could deliver the necessary performance while reducing licensing costs by aligning capacity with actual usage.
Throughput and Performance Metrics: Evaluate key performance indicators such as query response times, report rendering speeds, and the execution performance of automated processes. Determine whether the enhanced performance capabilities offered by premium tiers are necessary or if they can be scaled back to match actual workload demands.
For example, If a Power BI dashboard typically renders in 4 seconds and only occasionally spikes to 6 seconds (below an acceptable threshold of 7 seconds), then the performance provided by Power BI Pro is sufficient. Upgrading to Power BI Premium capacity, with its higher licensing costs, would not be justified in this scenario.
Concurrency Requirements: Assess peak simultaneous usage patterns across Microsoft 365 applications to decide if dedicated capacity (e.g., Power BI Premium) is justified or if a shared capacity model (e.g., Power BI Pro) would be sufficient. Using dedicated capacity licenses like Power BI Premium is only justified when concurrent usage consistently exceeds the limits of shared capacity.
For example, If analysis shows that 20 users typically access a Power BI report concurrently, but performance degrades only beyond 25 users, the current Power BI Pro shared capacity is adequate.
Scale vs. Elasticity Needs: Differentiate between consistent high-volume demands that require dedicated capacity and occasional usage spikes that could be managed through temporary capacity adjustments or strategic license reassignments. This distinction supports more dynamic and cost-effective capacity planning within the Microsoft 365 ecosystem.
For example, rather than permanently upgrading from Power BI Pro to Power BI Premium, you can secure a temporary capacity boost. During peak times, for example when daily data processing on Power BI averages 15GB but spikes to 30GB (exceeding a 20GB threshold)you could purchase a temporary Power BI Premium add-on or switch affected users to Power BI Premium Per User on a month-to-month basis. This consumption-based model allows you to provision extra capacity only during high-demand periods, then scale back once the peak is over, optimizing spending without committing to the higher ongoing costs of a permanent upgrade.
Technical Limits Assessment
Identifies where technical constraints of lower-tier licenses might be creating bottlenecks or inefficiencies that require strategic licensing decisions.
Technical Limits Assessment: It is recommended to identify where the technical limits of lower-tier licenses may create bottlenecks, or are over capacity and can inform downgrading to a lower license-tier.
For example, if your organization is using Power BI Pro, which limits individual dataset sizes to 1GB and allows only eight refreshes per day, and you frequently exceed these limits (e.g., generating datasets of 1.2GB), these technical constraints indicate a need to consider upgrading to Power BI Premium for larger capacity and enhanced performance.
Threshold Gap Analysis: Measure the gap between your actual technical requirements and the thresholds provided by your current licensing tier.
For example, if you are running Power Automate on a standard per-user plan with a limit of 5,000 flow runs per month but your team consistently reaches 7,500 runs, this threshold gap signals that either a plan with higher limits or workflow optimization is necessary to align usage with capacity.
Performance Impact Evaluation: Assess whether the performance limitations of shared-capacity services are causing measurable business impact.
For example, if dashboards in Power BI Pro take 8 seconds to render during peak usage - surpassing a critical performance threshold of 5 seconds - this delay could impact time-dependent decision-making, and justify an upgrade to Power BI Premium, which provides dedicated capacity and faster refresh rates.
Feature Dependency Mapping: Identify which business processes depend on premium-only features that are not available in lower-tier license plans.
For example, if your finance department relies on advanced paginated reports and AI-driven analytics -capabilities that are exclusive to Power BI Premium - this mapping confirms that maintaining Premium licensing is essential for those critical processes, even if overall usage might suggest otherwise.
Workaround Feasibility Assessment: Evaluate whether architectural changes or workflow adjustments could enable operations within the constraints of lower-tier licenses.
For example, if a Power BI Pro dataset slightly exceeds the 1GB limit by reaching 1.2GB, consider partitioning the data into two separate reports or optimizing the data model. Such adjustments may allow you to continue using Power BI Pro, thereby avoiding the higher costs associated with an upgrade to Power BI Premium.
Economic Value Analysis
Quantifies the business impact and ROI of different licensing decisions beyond simple cost calculations.
Productivity Impact Measurement: Quantify time savings or output improvements attributable to premium features to calculate true ROI beyond license costs.
Opportunity Cost Evaluation: Assess the business impact of technical limitations imposed by lower-tier licenses versus the premium spent on higher tiers.
Total Cost of Ownership Modeling: Develop comprehensive TCO models that include not just license costs but implementation, training, maintenance, and productivity implications of different licensing scenarios.
Business Outcome Alignment: Map license investments to specific business outcomes and KPIs to justify premium spending where clear value generation exists.
Rate Optimization
Licensing optimization focuses on refining the structure of your Microsoft 365 licensing to align with actual usage and needs. It involves strategically selecting the right mix of suites, add-ons, and tiers to ensure users have the necessary capabilities without over-provisioning. The objective is about paying for only what you use.
Pricing optimization, on the other hand, centers on securing the most favorable financial terms for your Microsoft 365 investment. This includes negotiating discounts, leveraging volume flexibility, securing price protection through multi-year commitments, optimizing reseller margins, and utilizing Microsoft partner incentives. While rate optimization ensures you're using the right licenses, pricing optimization ensures you're paying the right price for them.
A key precursor to this phase is Usage-Based Optimization Analysis, and Planning and Estimating. This requires cross-functional alignment of current-state usage of Microsoft 365 services, and current and planned adoption of services mapped to license demand, to inform the rate optimization strategy.
This process should incorporate insights and recommendations based on user status, service usage analysis, service activation analysis, storage analysis, and technical limits analysis, to provide insights into how Microsoft 365 services are being used in the organization.
The cross-functional alignment of stakeholders can inform current and planned adoption of solutions, to ensure business and technology requirements are met. Solution Alignment for Microsoft 365 involves understanding the needs of different departments and aligning them with the capabilities of the associated licensing suite(s) and plan(s). Rate optimization is dependent on having the right information to inform current and planned use of the Microsoft 365 technology stack, and enable administrators to take-action on identified cost savings.
Licensing Optimization
Unassigned Licenses: Identify unassigned licenses and evaluate whether assign to new or existing users, or remove.
Optimize Licensing Schema: Evaluate whether it's more cost-effective to license certain features as suites, add-ons, or higher tier plans (P2). plans. I recommend modular approach by combining different license tiers to match specific feature requirements. For example, some users might need the advanced features of E5, while others might only require the basic features of E3.
Use Licensing Profiles: Use the defined user profiles to assign the best fit license subscription plan(s) to users, to inform forecasting and fact-based decision making.
License Downgrades Analysis: Identify users where license suites or plans can be downgraded to a lower tier suite(s) or plan(s). Identify users who can be moved to lower-tier license plans or suites without impacting their productivity or security and compliance requirements. This helps reduce costs by ensuring users have the appropriate level of service to meet business requirements.
Assess Business Needs: Determine which lower-tier plans provide the necessary features for these users. Ensure that the essential services need are included in the lower-tier plan assigned (see Solution Alignment and User Technology Profiling above)
Identify License Downgrades: Identify users where license suites or plans can be downgraded to a lower tier suite or plan.
Feature Duplication Analysis: Identify users with license plans and suites assigned with overlapping features. This can happen when users are assigned different licenses that provide the same capabilities, leading to unnecessary costs.
Highlight users who have been assigned licenses with duplicate features.
Identify redundant licenses and ensure each user has only the necessary licenses to cover their required features. This helps in reducing costs and simplifying license management.
Phased Rollout Planning: Secure pricing upfront (see Pricing Optimization below) and defer purchasing new technologies, staggering rollout of new user license plans to avoid upfront costs.
Plan and model the rollout of new Microsoft 365 licenses in phases, aligning with actual user on-boarding and business needs. This avoids unnecessary upfront costs and allows for adjustments based on actual usage.
License SKU Eligibility: Regularly review and maintain eligible programmatic conversion SKUs and standalone product SKUs to ensure you are utilizing the most cost-effective licensing options available.
For example, sometimes rights to these valuable SKUs are accidentally or purposefully waived due to a discounted offer from Microsoft. It can be a trade-off decision to consolidate on ‘premium’ licensing suites, losing access to standalone or conversion ‘From SA’ SKUs in favour of a negotiated discount.
Competitor Cost-Benefit Analysis: Perform an additional cost-benefit analysis to compare the costs of maintaining competitor applications against the benefits they provide. This includes licensing costs, maintenance costs. (see Application Rationalization above)
Cost modelling can be an iterative process, starting with an initial baseline and then working across cross-functional stakeholders to complete assessments, and get alignment on business and technology requirements.
This provides the foundation for an Optimized Forecast. An optimized forecast can be enabled through accurate planning and estimating, both re-actively through analytics and proactively through strategic planning
Pricing Optimization
Programmatic Discounts: Microsoft provide programmatic discount waterfalls based on volume commitment upfront. The discount is dependent on the contract model, for example Microsoft Enterprise Agreement (EA).
Discount Negotiation: Microsoft products can often be discounted below the standard price file based on negotiation. Leverage historical and forecast spend and usage insights to enable volume discounts
Contract Optimization: Negotiate favorable contact amendments, including access to prior months price lists, discontinued or hidden SKUs, or improved product use terms.
Agreement Selection: Selecting volume agreement contract(s) can impact the total expenditure on Microsoft 365. For example, purchasing through a Microsoft Enterprise Agreement (EA), Microsoft Customer Agreement for Enterprise (MCA-E), or via a Cloud Solution Provider (CSP) have different advantages and disadvantages, entitlements, and restrictions.
Volume Flexibility: Adjust subscriptions quantities based on demand.
Evaluate licensing agreements that allow for dynamic adjustments in subscription volumes to accommodate seasonal or project-based fluctuations in user needs. This prevents over-provisioning during slower periods. Scale down the number of licenses during a slow period and scale up during peak season, optimizing costs based on actual demand. This should be evaluated against programmatic discounts and price protection for longer-term subscription commitments.
Price Protection: Lock in pricing for multi-year commitments.
Secure pricing by committing to multi-year subscription terms where feasible to protect against unexpected price increases and simplify long-term budgeting. This provides cost predictability and potentially reduces overall expenses. For example, if Microsoft announces a price increase in year two, your locked-in pricing would protect you from that increase. Additionally Microsoft may incentivize through programmatic discounts for one-year or multi-year commitments to products.
Reseller Margin Optimization: Negotiate optimal reseller margins.
If purchasing through a Cloud Solution Provider (CSP), negotiate optimal reseller margins for cloud billing and support to reduce overall costs. Compare reseller margins from different CSPs and negotiate for a more favorable rate, potentially leading to significant savings over time.
Identify whether reseller or independent consulting services could be used to identify cost savings, and balance this accordingly. Do not accept a ‘gain share’ model. I have worked in this industry for years, and always advocated for fixed-rate service fees. I can easily find savings that would lead to a six figure ‘success fee’ based on percentage of achieved savings.
Leverage Partner Incentives: Utilize Microsoft partner programs for co-investment in technology pilots, training, and adoption planning.
Leverage Microsoft partner programs for co-investment in technology pilots, training, and adoption planning to reduce costs and accelerate implementation with accredited partners.
Work with a Microsoft partner to secure funding for a proof-of-concept project for a new Microsoft 365 feature or for training on a specific application.
Cost Optimization Initiatives
The 'Cost and Usage Optimization' domain bridges the gap between analytical insights and actionable strategies, transitioning from identification to implementation of actionable cost-saving strategies for Microsoft 365. This section provides examples of cost-optimization initiatives that can drive cost savings:
Licensing Optimization
Scope Tenant-wide Services (Granular Access Control Implementation): Precisely limit access to tenant-wide services based on user roles and business needs.
Implement targeted access policies: Based on the access assessment, configure Azure AD groups and Conditional Access policies to restrict service access specifically to user groups requiring it.
Maintain current group permissions: Ensure the principle of least privilege by regularly auditing and updating group memberships to reflect changes in roles or responsibilities.
Remove Licenses: Systematically remove licenses from users that are no longer active.
Automate license de-provisioning: Use defined criteria for inactivity to automatically de-provision licenses from users identified as no longer active within the organization.
Comply with data retention: Apply established grace periods and data preservation policies to adhere to legal and compliance requirements during license removal.
Reassign Licenses: Efficiently reallocate available licenses to optimize license entitlement / assignment.
Redistribute licenses centrally: Utilize the centralized license management system to reallocate existing licenses before purchasing new ones, maximizing resource utilization.
Optimize re-assignment through reporting: Leverage data-driven reporting to efficiently re-assign licenses to new or existing employees based on their current needs.
Right Sizing: Match user technology profiles and business requirements with the appropriate Microsoft 365 suites and plans.
Assign tailored license suites: Implement Microsoft 365 suites and plans that precisely match user technology profile analysis, avoiding over-licensing and ensuring users have the tools they need.
Activate specific add-ons: Deploy only the necessary add-ons and features to specific user groups, based on their specialized needs, to maximize cost-efficiency.
License Downgrades: Assign users lower-tier license subscription plans based on actual usage.
Downgrade under-utilized licenses: Apply license downgrades to users identified as under-utilizing their current plan based on detailed usage analysis.
Support users with transition training: Provide comprehensive training to users on the features of their new license to ensure a smooth transition and continued productivity.
Adjust Licenses Based on Seasonality: Adapting license quantities to match seasonal fluctuations in user activity.
Implement seasonal license adjustments: Apply seasonal adjustments within the flexible licensing models (as permitted by contract) to align license counts with fluctuations in user activity.
Pricing Optimization
Reseller Margin Optimization : Securing the most cost-effective pricing and terms with resellers.
Execute agreed contract terms: Implement the negotiated pricing and terms with selected reseller.
Secure optimized service contract agreements: Finalize service bundle options and long-term contracts to secure the most favorable pricing and maximize cost savings and/or support and implementation services.
Policies and Automation
Automate License Assignments: Automate license assignments based on employee user status changes in the HR system. Use Entra ID to create license management groups for different user roles and automatically assign licenses based on group membership.
Automate User Deactivation: Define clear criteria for user inactivity (e.g., no login for a specified period). Implement automated processes for identifying and managing inactive accounts. Generate a monthly report of users who haven't logged in for 60 or 90 days and automatically deactivate their accounts after a warning period, enabling re-assignment of licenses to new or existing active users.
Integrate with HR Systems: Connect Microsoft 365 license management (this can be supported by ITAM/Microsoft 365 tooling) with HR systems to automatically revoke licenses from terminated employees. This prevents paying for licenses that are no longer needed. Upon an employee's termination being recorded in the HR system, an automated process deactivates their Microsoft 365 account and reclaims the associated license.
Automate license scaling: Activate automated up-scaling and down-scaling of licenses based on predefined triggers to ensure timely adjustments without manual intervention.
License Assignment Approval Workflows: Implement governance processes requiring justification for premium license assignments based on documented need and usage forecasts.
Regular Entitlement Reviews: Establish quarterly or bi-annual review cycles to reassess license assignments against actual usage data and changing business needs.
Automated Reclamation Processes: Develop automated systems to identify and reclaim licenses from inactive users or those failing to meet minimum usage thresholds.
License Pool Management: Create centralized license pools for specialized or premium licenses that can be dynamically assigned based on demonstrated need rather than permanent allocation.
Value Optimization Initiatives
Ensures maximum value realization from existing licenses through strategic implementation and adoption initiatives.
Feature Awareness Campaigns: Develop targeted communication to increase awareness of “premium” features already licensed but underutilized, potentially avoiding unnecessary additional purchases.
User Enablement Programs: Implement training and enablement initiatives focused on high-value “premium” features to increase adoption and ROI for existing license investments.
Workflow Integration Assessment: Evaluate how deeply “premium” capabilities are embedded in business processes and workflows, identifying opportunities to increase value through better process integration.
License Rotation Programs: Establish systems for temporary license allocation to address periodic needs rather than permanent assignment, particularly for specialized or costly licenses like Copilot.
4. Establishing and Managing a FinOps Practice for Microsoft 365
I strongly recommend establishing or accelerating your FinOps capabilities specifically tailored for Microsoft 365. This moves beyond ad-hoc optimization efforts to create a continuous, data-driven, and strategically aligned approach to cost management, aligning with the "Operate" phase of the FinOps lifecycle.
A robust FinOps practice is crucial for realizing the full value of your Microsoft 365 investment while controlling costs and maximizing ROI.
Education and Enablement
Alignment and Education
Establish a Cross-Functional FinOps Team: Establish a dedicated, cross-functional FinOps team responsible for Microsoft 365 cost optimization. This team should include representatives from FinOps, ITAM, IT, procurement, FinOps, finance, security, compliance, and relevant business units. Clearly define roles and responsibilities within the team.
Defining Roles and Responsibilities: Establish a clear governance structure for cost management for Microsoft 365.
Clearly define roles and responsibilities for Microsoft 365 cost management. Establish a governance structure that outlines who is accountable for different aspects of cost optimization, from data analysis to implementation and reporting.
Establish a cross-functional team to review cost optimization recommendations and make decisions.
Education and Enablement: Develop and deliver targeted training programs and resources to educate the FinOps team and key stakeholders
Targeted Training: Develop and deliver training on Microsoft 365 licensing models, cost drivers, and optimization strategies to all relevant stakeholders.
Continuous Learning: Keep your team updated with evolving product features, licensing updates, and best practices to ensure ongoing competency.
Framework Assessments
FinOps Assessment for Microsoft 365
FinOps Framework Assessment: Regularly assess the maturity of FinOps capabilities, extending the scope including Microsoft 365.
Periodic Reviews: Conduct regular assessments of your FinOps processes, tools, metrics, and governance structures to determine maturity and effectiveness.
Stakeholder Feedback: Involve key stakeholders in periodic reviews to identify gaps and refine your framework.
This can be aligned with other complimentary and intersecting frameworks, including IT Asset Management.
Practice Operations
Performance Monitoring
Establish KPIs: Establish Key Performance Indicators (KPIs) that directly reflect the success of your FinOps practice for Microsoft 365.
KPI Mapping & Review: Review and continue to develop KPIs that reflect the success of your cost optimization and ROI objectives and review them regularly.
Mapping to Business Outcomes: Ensure that each KPI is directly linked to business outcomes, such as improved productivity, reduced costs, or enhanced security.
Automated Tracking: Utilize automated reporting tools to track performance metrics and quickly identify deviations.
FinOps Practice Governance
Strategic Alignment Workshops: Define cost optimization objectives, priorities, and success metrics with stakeholders.
Conduct workshops with key stakeholders from FinOps and ITAM, IT, procurement, finance, and relevant business units to define clear cost optimization objectives, priorities, and success metrics for what success looks like for the Microsoft 365 investment.
Ensure alignment between cost optimization efforts and overall business and technology goals.
Prioritize Initiatives: Use these sessions to agree on priorities and success metrics, ensuring that each initiative is linked to tangible business outcomes.
Governance Cadence: Establish regular (e.g., monthly or quarterly) governance meetings to review performance, discuss strategic shifts, and ensure alignment with overall business goals.
Cost Optimization Process: Implement a structured, repeatable cost optimization process for Microsoft 365 incorporating best practices and regular evaluation. This includes:
Baseline Analysis: Conduct a thorough analysis of current Microsoft 365 spend, license entitlement and assignment, feature activation and usage to identify areas of over-spend, under-utilization, and potential cost savings. Establish a "baseline" against which future cost optimization initiatives will be measured.
Cost Optimization Reviews: Conduct periodic, detailed analysis of licensing and utilization data to identify opportunities for cost savings and/or opportunities to improve adoption of Microsoft 365 services and features and improve ROI.
Cost Optimization Initiatives: Track and implement actionable cost optimization recommendations, prioritizing based on potential savings, feasibility, and impact.
Value Improvement Initiatives: Identify products and services that are not activated or not utilized, and review with responsible stakeholders aligned to the defined technology roadmap established. (See “Solution Alignment” in “Planning and Estimating”)
Operating Model Evaluation: Regularly assess team structure, process efficiency, and tool effectiveness. Identify friction points and adjust governance models to improve responsiveness.
Tooling and Automation
Tool Evaluation & Selection: Evaluate and select appropriate Microsoft 365 / ITAM management tools to automate license tracking, compliance, usage monitoring, reporting, cost optimization, and integration with other systems. Consider factors such as functionality, ITAM integration capabilities, and cost.
Tool Onboarding & Data Integration: Onboard and implement chosen tools, integrating them with relevant data sources (e.g., Microsoft Graph API, Entra ID, Microsoft 365 Admin Center, HR systems, ITSM systems) to ensure accurate data collection and reporting.
Automation: Implement automated controls wherever possible to manage licensing assignments, reclaim licenses from terminated employees, manage inactive accounts, and streamline other cost optimization tasks.
Reporting and Communication
Dynamic Dashboards: Create dashboards that monitor usage, spending, and savings opportunities in real time.
Regular Reporting: Generate detailed monthly reports covering KPI metrics such as cost per user, realized savings, and ROI improvements
Develop reporting to support contractual reporting requirements, including “True Up” reports..
Feedback Loops: Establish continuous communication between FinOps, Finance, Procurement, and IT teams to refine cost management practices and drive sustained improvement.
Example Cost Optimization KPIs for Microsoft 365
The table below provides some example KPIs for driving value or optimizing costs for Microsoft 365 as part of a process of continuous improvement:
Inform
KPIs focused on visibility, awareness, and data-driven insights to understand M365 costs.
| KPI Name | Description | Metric Type | Target Example | Key Considerations |
|---|---|---|---|---|
| M365 Cost per User | Average monthly cost of M365 services per user | Currency/User | Reduce by 10% over 12 months | Track trends; segment by department; compare to benchmarks |
| Copilot Cost per User | Monthly cost for Microsoft 365 Copilot licenses per user | Currency/User | Maintain within $30/user/month | Isolate Copilot costs; benchmark against productivity gains |
| Storage Cost per GB | Monthly cost of M365 storage per gigabyte | Currency/GB | Reduce to below $0.05/GB | Identify high-cost storage areas; benchmark against cloud rates |
| License Utilization Rate | Percentage of provisioned licenses actively used | Percentage | Increase to >90% | Define "active usage" clearly; segment by license type |
| Copilot Adoption Rate | Percentage of provisioned Copilot licenses with active usage | Percentage | Achieve >85% utilization | Track by department; identify adoption barriers |
| Storage Growth Rate | Monthly percentage increase in total M365 storage | Percentage | Keep below 5% monthly | Monitor trends; implement proactive storage policies |
| License Assignment Rate | Percentage of purchased licenses assigned to users | Percentage | Maintain >98% | Minimize waste from unassigned licenses |
| Cost Allocation Accuracy | Percentage of M365 costs accurately allocated to departments | Percentage | Achieve >95% accuracy | Improve chargeback accuracy; drive accountability |
| Cost Visibility Index | Score measuring stakeholders' access to cost data | Score (1-10) | Achieve score >8 | Assess transparency of cost reporting |
Optimize
KPIs focused on taking actions to improve cost efficiency and value delivery of M365.
| KPI Name | Description | Metric Type | Target Example | Key Considerations |
|---|---|---|---|---|
| Identified Savings Potential | Estimated savings from identified optimization opportunities | Currency | Maintain $100K pipeline | Track optimization pipeline; prioritize by ROI |
| Realized Cost Savings | Actual savings achieved from implementing optimizations | Currency | Achieve $75K annually | Compare to identified savings; assess implementation efficiency |
| Rightsizing Conversion Rate | Percentage of identified opportunities successfully realized | Percentage | Increase to >80% | Identify implementation bottlenecks |
| License Tier Optimization | Percentage of users on appropriate license tiers | Percentage | Achieve >95% optimal placement | Regular assessment of user needs vs. license features |
| Storage Reduction Rate | Percentage reduction in storage costs through optimization | Percentage | Reduce by 15% annually | Measure impact of lifecycle policies and cleanup efforts |
| Contract Negotiation Savings | Cost savings from renegotiated contracts/discounts | Currency | Achieve $50K per renewal | Track procurement effectiveness |
| Automated License Management | Percentage of license management tasks automated | Percentage | Increase to >75% | Reduce manual effort; improve consistency |
| Inactive Account Reclamation | Percentage of inactive accounts identified and addressed | Percentage | Achieve >95% reclamation | Automate detection of dormant accounts |
| License Consolidation Rate | Reduction in license type variations across organization | Percentage | Reduce variations by 25% | Simplify license management; increase buying power |
| OneDrive/SharePoint Clean-up | Percentage of redundant/obsolete content removed | Percentage | Clean up >30% of eligible content | Target duplicate/outdated content |
Operate
KPIs focused on governance, processes, and operational excellence for M365 cost management.
| KPI Name | Description | Metric Type | Target Example | Key Considerations |
|---|---|---|---|---|
| Policy Compliance Rate | Percentage of users/teams complying with cost policies | Percentage | Achieve >90% compliance | Measure governance effectiveness |
| Cost Review Frequency | Number of cost reviews conducted annually | Count/Year | Conduct quarterly reviews | Embed regular cost management in operations |
| Optimization Implementation Time | Average days to implement optimization recommendations | Days | Reduce to <15 days | Assess organizational agility in cost management |
| FinOps Maturity Level | Level in recognized FinOps maturity model | Maturity Level | Progress one level annually | Track capability development |
| Cross-functional Collaboration | Number of stakeholder groups actively involved in M365 FinOps | Count | Engage >4 departments | Ensure IT, Finance, HR and business units collaborate |
| License Workflow Efficiency | Average time to process license requests/changes | Hours | Reduce to <4 hours | Optimize provisioning processes |
| Cost Anomaly Detection Time | Average time to detect and address cost anomalies | Days | Identify within 5 days | Improve monitoring capabilities |
| Training Completion Rate | Percentage of admins with cost management training | Percentage | Achieve >90% completion | Build capability across the organization |
| Cost Management Tool Adoption | Utilization of available cost management tooling | Percentage | Achieve >85% tool utilization | Leverage available technology |
| Cost vs. Value Assessment | Regular reviews comparing cost to business value | Count/Year | Conduct bi-annual reviews | Focus on value realization, not just cost reduction |
Recommendation
To develop a right-sized and time-appropriate investment plan that meets both short and near-term roadmap requirements, identify and review current and planned utilization of Microsoft cloud services with internal stakeholders as part of a cross-functional collaborative process.
Implement a cost optimization process for Microsoft 365 cloud services, assigning actionable tasks to the responsible team(s) to execute, empowering internal stakeholders to continuously review progress on achieved cost savings.
Forecast the cost of current and near-term roadmap requirements, incorporating potential savings from cost optimization recommendations, to enable implementation of cost savings and inform flexible decision-making on future cloud investment decisions between IT and procurement stakeholders.
Conclusion
Optimizing Microsoft 365 costs requires a strategic, data-driven approach aligned with the FinOps framework. By understanding usage, quantifying business value, implementing optimization strategies, and establishing governance, organizations can minimize spend while maximizing ROI. This involves a continuous cycle of assessment, implementation, and ongoing management, ensuring that Microsoft 365 investments deliver optimal value and support business objectives.
Implementing an effective cost optimization process for Microsoft can enable accountability for growing cloud spend with a prescriptive methodology, enabling distributed IT and procurement stakeholders to take-action on cost savings, increase value from cloud investments, and inform flexible decision-making on future cloud investment decisions.
Procurement stakeholders are empowered to establish a fact-based discourse with Microsoft, and enable negotiation leverage by optimizing current spend, and by understanding the allocation and drivers of cloud services growth in advance of negotiations with Microsoft
Next Steps
Call to Action: Getting Started with FinOps for Microsoft 365 Microsoft 365 is an extensive ecosystem of products and features, but realizing its full value requires a proactive and data-driven approach to cost management – a discipline best served by developing the FinOps for Microsoft 365.
Conduct a Microsoft 365 Health Check: Begin with a thorough analysis of your current Microsoft 365 environment. Leverage the essential data sources outlined in this document to gain a clear understanding of your current license assignments, usage, and spend.
Identify areas of potential overspend, under-utilization, and waste. This assessment should involve key stakeholders from IT, ITAM, procurement, finance, and relevant business units, establishing a cross-functional FinOps team.
Develop a Cost Optimization Strategy: Based on the assessment findings, start to create a customized cost optimization strategy that aligns with your organization's specific needs and objectives. Prioritize initiatives based on their potential impact and feasibility.
Engage with Licensing Experts: Consider partnering with a managed service provider or consultant specializing in Microsoft 365 cost optimization and FinOps. These experts can provide structured consulting, cost modelling, and support in navigating Microsoft 365 licensing. They can also help you leverage data-driven insights to negotiate more effectively with Microsoft as part of your contract renewal.
About Tony Mackelworth
Tony Mackelworth is a recognized leader in Microsoft Advisory Services and FinOps, with a proven track record in service leadership, product management and consulting. He has built and scaled global service portfolios in Microsoft consulting and FinOps, driving innovation, efficiency, and tangible results for global organizations.
With extensive experience delivering consulting services and leading practices, Tony combines strategic vision with hands-on expertise to help organizations maximize value from their Microsoft investments. This website serves as a resource for the licensing community and a platform to share insights, empowering businesses to navigate Microsoft software and licensing with confidence.
Learn more about his work and insights at Softspend.
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