IT Asset Management (ITAM): A Definition and Guide

In this post, we’ll cover IT asset management (ITAM) – a definition, why ITAM matters, how it is related to ITSM, and how it will change in the future.

IT Asset Management (ITAM): A Definition

IT asset management (ITAM) is a business function dedicated to managing, optimizing, and leveraging IT assets. Ultimately, the aim of ITAM is to ensure the organization maximizes the usage of its IT assets.

To better understand what this means, let’s define a few key concepts related to ITAM:

• IT assets. An IT asset is any piece of software, hardware, or firmware used to support a business’s core operations. This includes both physical assets and digital assets. A physical asset is something like a server, while a digital asset is something like a computer program. 
• The IT asset life cycle. The life cycle of an IT asset refers to the complete process an asset goes through after it is acquired. Though the exact diagram of this roadmap may look different depending on the situation, it often includes stages such as: Acquisition, Deployment, Operations, Maintenance, and Retirement 
• IT service management (ITSM). ITSM is the process of overseeing the quality of IT services provided by IT departments and third-party service providers. The goal of IT service management is to achieve consistent, high-quality IT services that meet both the customers’ needs and the organization’s needs.

While ITSM focuses on services, ITAM focuses on assets – and both are designed to maximize the value of IT and reduce inefficiencies.

Why It’s Important to take a Structured Approach to ITAM

As with any other business process, the more detailed, structured, and measurable that process, the better the results will be.

More specifically, businesses that take a structured approach to ITAM will see:

• More transparency into IT assets and related business processes. By monitoring the utilization of IT assets throughout their life cycle, managers will have deeper insights into where funding is flowing, how fully IT assets are being utilized, and so forth. That information, in turn, can inform many other decisions, from procurement to decisions around digital transformation.
• Less waste. Greater insight into and control over IT usage means that managers will better be able to avoid unnecessary purchases, software licenses, and more. For best results, a structured approach to ITAM should also include an approach to software asset management (SAM), as well as innovative approaches to IT infrastructure management. Composable IT infrastructure, for example, can automate and significantly improve the performance of IT systems.
• Increased performance. Inefficient use of IT assets can result not only in wasted money, it can also slow down employees, inhibit innovation, and allow them to shorten IT service delivery times. Also, when an organization has an ITAM system in place, the entire organization can access that system and use that information strategically when, for instance, creating digital strategies.

Naturally, adopting a fully structured approach to ITAM is easier said than done, and IT directors must take the time to research each option carefully. Then, once a decision is made, that new approach must be fully integrated into the business.

Approaches to ITAM

One of the best approaches to ITAM is through the IT Infrastructure Library (ITIL).

ITIL is a well-known set of best practices dedicated to IT service management. The ITIL framework provides a set of processes, procedures and operations that enable IT organizations to provide consistent, high quality services to both the organization and its customers.

The latest version of ITIL, ITIL 4, also includes processes dedicated specifically to ITAM.

Here are a few key ITAM definitions and categories as they are found in ITIL 4:

• Hardware assets, such as end-user devices and data center hardware
• Software, such as middleware and operating systems
• Cloud services, such as IaaS and SaaS
• Data, such as business intelligence and customer data

ITIL 4 also offers a clear definition of the IT asset life cycle. 

Its stages include:

• Financial management, such as budgeting
• Requisition and acquisition
• Inventory
• Software license management
• Retirement and disposal

Each of these stages, incidentally, fits within the overall ITIL framework. Before attempting to make use of this process, therefore, it is necessary to have already implemented ITIL in one’s own organization. 

How ITAM Will Change in the Years Ahead

For years, digital innovation has been fueling major disruptions across every sector of the economy. 

Many of those trends were further accelerated during 2020, when companies around the world were compelled to adopt new technologies and work modes, such as cloud computing and remote working.

This paradigm shift is still underway and it will continue to shape the way organizations handle IT assets.

Generally speaking, we can expect to see:

• More cloud-based IT assets
• More automation, such as composable IT infrastructure
• Increased realization of the importance of ITAM
• The use of new technologies, such as blockchain, to track and manage assets

In short, the digital revolution is far from over. As that revolution continues to transform the digital enterprise, we should expect to see even greater emphasis placed upon IT disciplines, such as ITIL, ITSM, and ITAM.