Can Your Organization Defend Every Core, Contract, and Clause in an IBM Audit?
Eliminate compliance gaps, reduce licensing waste, and build a defensible IBM position before auditors arrive.
Whether under audit, approaching a renewal, or reevaluating ILMT readiness, LDS gives you full control over IBM licensing—ensuring compliance, cost-efficiency, and confidence in every report you submit.
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Reduce Costs
Optimize licensing to eliminate unnecessary spending
25-40% Average Savings
Ensure Compliance
Avoid costly audit penalties and legal risks
100% Audit Readiness
Maximize ROI
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60%+ Enhanced Value
The Compliance Challenge Every IBM Customer Faces
Managing IBM software entitlements is no small task. With hundreds of licensing metrics, evolving policies, and product-specific rules, organisations often struggle to maintain clarity over their rights and obligations. Many agreements are left untouched after purchase, leaving decision-makers uncertain whether they are fully compliant—or if they're paying more than necessary.
45% of IBM-audited organizations have incurred over $1 million in unplanned costs over the past three years. IBM's licensing framework is among the most complex in the industry, and audits are a fact of life. Yet, with the right insight, financial exposure can be avoided. Capacity-based models, such as PVU, RVU, or VPC, can deliver cost efficiency for organisations with changing workloads—but they also carry hidden compliance risks if not managed with precision.
Virtualisation changes, hardware upgrades, or misinterpretation of eligibility requirements can all tip an environment out of compliance. A single misconfiguration or oversight can result in significant financial penalties during an audit.
Where Organizations Lose Control — Fast
Even organizations with mature IT practices can face issues during IBM audits
ILMT misconfiguration
leading to full-capacity licensing charges
Inactive or orphaned users
increasing costs for user-based products
Cloud migration gaps
resulting in duplicate licensing or invalid transfers
Limited cross-team coordination
between IT, procurement, and compliance functions
How LDS turn Audit Anxiety into Advantage?
Turn Audit Anxiety into Strategic Advantage
Managing IBM software is not just a technical task — it’s a contractual and financial responsibility. At LDS, we combine former IBM auditor expertise with over 15 years of licensing experience to help organisations maintain compliance, optimise costs, and strengthen their position in every IBM engagement.
Our Expertise
End-to-end IBM licensing solutions
LDS provides end-to-end expertise in IBM software licensing, compliance, and audit defence. We believe that prevention is always more cost-effective than cure—addressing potential compliance risks before they escalate into formal audits or costly disputes.
• Our approach covers every stage of IBM licence management, including:
Strategic licensing guidance and ongoing optimisation of your IBM software environment.
Identifying opportunities to lower annual support and maintenance expenses.
Reducing exposure to unexpected legal or financial liabilities.
Managing and defending against IBM audit findings with evidence-based strategies.
Your Trusted Partner
With LDS, you gain a partner who not only understands IBM’s licensing rules inside out but also knows how to keep your organisation compliant, cost-efficient, and ready for any audit scenario.
Our IBM Licensing Services IncludeComprehensive IBM Compliance & Optimization
Baseline Compliance Assessment
A detailed review of your current IBM environment, existing tools, and entitlement records to establish a clear compliance position.
Entitlement & Deployment Mapping
Correlating your actual software usage against your licence rights, including sub-capacity and full-capacity scenarios.
Audit Preparation & Defence
Leveraging our audit experience to pre-empt non-compliance claims, challenge inaccurate findings, and negotiate fair resolutions.
Ongoing Monitoring & Reporting
Regular reporting on IBM deployments versus entitlements, highlighting over- or under-deployment risks before they escalate.
Contractual Guidance
Interpreting Passport Advantage terms, providing practical advice on how to meet IBM's obligations, and reducing legal exposure.
Our Numbers Speak for Themselves
Proven results that demonstrate our expertise and commitment to excellence in IBM licensing
ENTERPRISE MICROSOFT CLIENTS
CLIENT SAVINGS
MICROSOFT LICENSING EXPERTS
YEARS OF MICROSOFT EXPERIENCE
AUDIT DEFENSE SUCCESS RATE
Key BenefitsKey Benefits of Choosing LDS for IBM Licensing Services
LDS enables organizations to confidently manage their IBM software licenses through expert analysis, proactive compliance strategies, and audit-ready support. Here's how your business benefits when you partner with LDS:
Full License & Entitlement Clarity
License Data
We begin by thoroughly reviewing your IBM software licenses, agreements, and usage records. This ensures you have a clear understanding of your entitlements — and any potential compliance gaps.
Accurate Usage vs. Entitlement Mapping
Actual Usage
EntitlementsLDS compares actual software deployments and usage against your licensing entitlements. This helps identify over- or under-licensing and ensures you're not exposed to unnecessary compliance risks or costs.
Proactive Internal Compliance Audits
Our team supports regular internal audits, allowing you to stay ahead of any licensing issues. This proactive compliance monitoring helps resolve discrepancies before they escalate into larger problems.
Complete IBM Audit Readiness
When facing an IBM audit, LDS ensures you're fully prepared. We guide you through the process and help compile the required documentation — including software entitlements, deployment records, and agreements.
Ongoing Software Record Management
We help you maintain clean, current, and auditable licensing records through routine reviews and updates. With LDS, you're always ready — no surprises.
What We ReviewComprehensive IBM Software Review
Our IBM Software Optimization Service provides complete visibility into your software environment. We analyze every critical area to ensure compliance, reduce costs, and prepare your business for the future.
IBM Server Deployment Baseline
Detailed inventory of IBM software across your physical, virtual, and cloud environments.
User-Based Product Assessment
Usage review of key IBM solutions like Cognos, Maximo, Sterling, and others to ensure proper licensing alignment.
Mainframe Software Baseline
Analysis of IBM software running on mainframe systems, ensuring full visibility and entitlement mapping.
ILMT Health Check
A technical review of your IBM License Metric Tool (ILMT) setup to validate data accuracy and compliance tracking.
IBM Audit Defense Readiness
Audit preparedness assessment with recommendations and documentation support to respond confidently to IBM reviews.
License Cost Impact Simulation
Financial modeling of future IBM licensing scenarios—including annual true-ups—to help you forecast and budget accurately.
Third-Party Support Evaluation
Analysis of potential cost savings through qualified third-party IBM support options, without compromising compliance.
What You'll ReceiveActionable Insights & A Clear Path Forward
After the review, you'll get a detailed, executive-ready report that outlines our findings and provides clear, independent recommendations tailored to your business goals.
IBM Effective Licensing Position (ELP)
A complete, audit-ready snapshot of your current license entitlements versus actual usage.
Licensing Optimization Recommendations
Actionable suggestions for cost reduction, license reallocation, and more efficient licensing models.
Strategic Licensing Roadmap
A forward-looking plan to manage IBM software smarter—supporting growth, budget planning, cloud transitions, and vendor negotiations.
LDS PVU and Non-PVU AssessmentComprehensive IBM Licensing Assessment
IBM's licensing spans multiple metrics — from Processor Value Units (PVUs) to user-, resource-, and data-based models. LDS ensures you're licensed accurately, cost-effectively, and audit-ready across all these scenarios.
PVU Licensing
Processor Value Unit Assessment
We collect detailed hardware specifications, consult IBM's official PVU tables, and calculate the exact entitlement requirements — factoring in sub-capacity rules for virtualised environments.
Deliverable
Results are documented in an Effective License Position (ELP) report, giving you a clear, defensible view of usage.
Non-PVU Licensing Models
IBM also uses other metrics depending on the product. LDS optimizes across all licensing models:
UVU
Named users
LDS Role in Optimization
Map user types, align entitlements to access needs.
VPC
vCPU per VM
LDS Role in Optimization
Assess cloud/VM workloads, choose most efficient metric.
RVU
Memory or storage usage
LDS Role in Optimization
Track resource consumption, right-size licensing.
Install/Server
Per install or server
LDS Role in Optimization
Identify deployments, avoid unlicensed instances.
MLC
Peak mainframe usage
LDS Role in Optimization
Analyse MSU trends, optimise subscription costs.
Complete Optimization Approach
We identify the correct metric for each product, compare cost implications, and ensure compliance with IBM's latest rules.
Cloud & BYOSL
Bring Your Own Software License Optimization
For migrations, we evaluate PVU vs VPC licensing, leverage Bring Your Own Software License (BYOSL) options, and align entitlements with AWS, Azure, or other approved platforms to prevent overspend.
LDS Two-Phase Approach to IBM Licensing
This is not just a routine check-up; in many cases, LDS steps in just in time to prevent massive, unexpected IBM audit penalties that could cripple IT budgets for years.
Phase One – The Review Phase
LDS begins with a forensic-level review of the organization's IBM licensing environment. The objective is simple: see what IBM would see in an audit — and fix the problems before they can be used against you.
Phase Two – The Optimization Phase
Once LDS has eliminated the compliance landmines, the focus shifts to making IBM licensing work for you, not against you.
Phase One – The Review Phase
This phase covers three key areas to create an airtight entitlement library that IBM can't poke holes in.
Entitlements Review
- • Passport Advantage Review
- • Proof of Entitlement (POE) consolidation & currency evaluation
- • Client specific Metrics & Measurement analysis
- • IBM product specific usage definition
Architectural Review
- • Inspection of IT Architecture for IBM footprint
- • Review & understand server naming, sizing & environment classification
- • Cloud review
- • Assess virtualisation strategy in context of IBM licensing policy
- • Check for use of Kubernetes and Containerisation
IBM SAM Capability Review
- • Assess the current tooling in place & how fit for purpose it is
- • Review reporting outputs vs. entitlements
- • Check existence & versions of any administration consoles for IBM Software
- • ILMT (if present) health check
Phase Two – The Optimization Phase
Strategic optimization to make IBM licensing work efficiently and cost-effectively for your organization.
Model Optimization
LDS analyzes your licensing metrics and deployment architecture to find the most cost-effective configuration without breaching IBM's rules. This could involve:
- Moving workloads to lower-cost licensing tiers
- Consolidating servers or workloads to reduce PVU/VPC counts
- Retiring underused products and reallocating licenses where needed
Strategic Audit Defence
If an IBM audit is active or anticipated, LDS prepares the defense package:
- We present IBM with exactly what they need to see — no more, no less — in a format that protects the organization's position
- Every figure is backed with documented proof, preventing IBM from making inflated claims
- LDS handles negotiations to ensure that any adjustments are based on verified data, not speculative findings
ILMT-as-a-Service – Permanent Compliance Assurance
For organizations that don't want to live in fear of the next IBM audit, LDS offers to manage ILMT on their behalf:
- Continuous monitoring of ILMT health and accuracy
- Regular compliance snapshots and alerts
- Proactive recommendations before licensing issues can grow into costly breaches
LDS LicenseOpticsDeep ELP & IBM License Optimization
At LDS, optimization is not an afterthought—it's an integrated part of our IBM licensing services. We conduct a deep-dive Effective License Position (ELP) to uncover hidden risks, inefficiencies, and cost-saving opportunities across your IBM estate.
Usage Verification
We analyze real-time usage data from system logs, Active Directory, and application reports to assess who is using what, when, and how.
Entitlement Matching
For each IBM product, we determine the correct metric and map it against actual deployment. We validate your PoE and compare with usage to identify gaps or surplus.
Inactive & Dormant User Cleanup
We examine Active Directory for dormant or duplicate accounts—users who haven't logged in for 90 days—and flag these for removal or reassignment.
License Right-Sizing
We identify users who are over-licensed or underutilizing assigned products and recommend tier downgrades or reallocation.
Metric Optimization
If a product supports multiple metrics, we analyze usage trends to determine the most cost-effective licensing model.
Redundant Software Identification
We detect unused installations or shelfware consuming maintenance costs and advise on retirement or consolidation.
Data-Backed Results
By combining metric-by-metric analysis with real usage insights, we deliver data-backed optimization strategies that reduce waste, enhance compliance, and drive down IBM license spend—often by millions.
LDS CloudPakIQSmarter IBM Cloud Pak Licensing & Cost Control
Bundle smarter. Spend less. Simplify compliance.
At LDS, we help organizations evaluate, model, and optimize IBM licensing across on-prem and cloud environments—with a focus on cost reduction, license efficiency, and modernization readiness.
Avg Cost Reduction
Through Cloud Pak optimization
License Efficiency
Improved through bundling
Compliance Rate
Maintained during transition
IBM Cloud vs On-Premises Strategy Evaluation
We assess whether your current IBM workloads are better suited for the cloud or should remain on-prem, including opportunities to migrate to IBM SaaS solutions.
IBM Cloud Pak Licensing Advisory
We analyze your use of individual IBM products and assess whether bundling them into a Cloud Pak can significantly reduce license costs.
LDS Audit Advisory ServicesExpert Guidance Through Every Phase of Your IBM Software Audit
Expert guidance through every phase of your IBM software audit.
At LDS, we proactively guide organizations through the full lifecycle of IBM software audits—from preparation to negotiation—ensuring compliance while minimizing risk and financial exposure.
Pre-Audit Preparation
We help clients establish a strong audit-ready posture long before any formal notice arrives.
Audit Response Support
If IBM initiates an audit, LDS leads the engagement with precision and control.
Documentation Management
We ensure all supporting evidence is complete and audit-ready for IBM's review.
Risk Mitigation and Negotiation
When IBM identifies shortfalls, we analyze findings to ensure accuracy and fairness.
Ongoing Audit Defense Discipline
Our engagements leave clients with long-term benefits and embedded governance.
Complete Audit Protection
This organized documentation gives IBM confidence in your compliance posture and helps control the audit narrative, while our experienced advisors ensure your interests are protected throughout the process.
LDS Other SAM Publishers
Extending our expertise beyond IBM to provide comprehensive software asset management across all major technology publishers
Don't Take Our Word for It — Hear from our Customers Who Faced Serious Risk
Navigating IBM licensing can be complex, and the risks of over-deployment, shelfware waste, and audit exposure are real. Our clients have turned to LDS to identify hidden risks, reclaim wasted spend, and avoid multi-million-dollar audit penalties. From missing ILMT configurations to untracked PVU usage, these organizations protected their budgets and achieved compliance clarity with LDS by their side.
"Facing a looming IBM audit, we discovered our ILMT agents were missing on critical servers, risking full-capacity charges across our virtualized environment. LDS quickly identified the gaps, deployed ILMT correctly, and aligned our sub-capacity reporting, avoiding $7.9 million in potential penalties."
"We were paying support on shelfware for IBM WebSphere and MQ licenses we hadn't used in years. LDS performed a detailed usage review, reclaiming these entitlements, cutting unnecessary support renewals, and saving $5.2 million while retaining compliance."
"An internal compliance review revealed potential PVU overuse across our hybrid cloud deployments. LDS conducted a full PVU analysis, validated entitlements, and right-sized our usage, resolving $3.4 million in exposure before IBM's audit."
"We discovered our IBM Cloud Pak deployments had exceeded licensing limits due to shadow IT. LDS performed a detailed usage audit, negotiated with IBM to adjust entitlements, and optimized our deployment footprint, saving us $4.7 million in potential audit findings and future spend."
"During our IBM renewal cycle, LDS uncovered complex bundling misinterpretations and misaligned entitlements across DB2 and WebSphere, which could have triggered $6.5 million in audit exposure. LDS remediated the compliance gaps, prepared clean data for IBM, and led renewal negotiations to secure savings."
"Our IBM Cognos environment had untracked user growth, resulting in user over-deployment. LDS mapped actual user counts against entitlements and optimized licenses, saving $2.8 million in excess renewal costs while ensuring audit readiness."
"After receiving an audit notice, we found misconfigurations in our ILMT sub-capacity reports and missing agents, risking full-capacity exposure across hundreds of cores. LDS identified the exact issues, corrected the configurations, and provided audit defense, avoiding $3.1 million in penalties."
Success Story
Real-world results from our license optimization services
Global Financial Services Firm – USA
Cost Avoidance Through IBM License Optimization and Audit Defense
Challenge
A U.S.-based financial services firm with 16,000+ employees faced multiple IBM compliance risks:
- •Missing ILMT agents on key virtual clusters, risking full-capacity exposure.
- •Untracked PVU consumption across hybrid cloud environments.
- •Shelfware consuming support costs on unused WebSphere, DB2, and MQ licenses.
- •Potential bundling misinterpretations inflating entitlements.
- •Lack of a clear sub-capacity reporting process, creating audit vulnerability.
The organization received a pre-audit inquiry from IBM and realized its internal team lacked the specialized licensing and ILMT expertise to resolve these issues before an audit escalated.
Solution
Licensing Data Solutions (LDS) was engaged to conduct a comprehensive IBM license optimization and audit risk mitigation project.
Key activities included:
- ✅Full entitlement normalization across all IBM contracts.
- ✅Deployment and remediation of ILMT agents across clusters.
- ✅Sub-capacity reporting validation to avoid full-capacity charges.
- ✅Shelfware identification, removing unnecessary S&S costs.
- ✅PVU consumption and hybrid deployment analysis for compliance.
- ✅Correction of bundling misinterpretations across WebSphere and DB2.
- ✅Creation of a complete IBM audit defense package.
- ✅Support during vendor negotiation to align entitlements with usage.
Results
💰 $5.9 million in cost avoidance
By reclaiming shelfware costs, correcting sub-capacity risks, and aligning entitlements before the IBM audit.
🛡️ 100% IBM audit readiness
With a complete ELP and accurate ILMT reporting, ensuring clean audit defense.
📊 70% improvement in license accuracy
Through mapping PVU and user metrics to entitlements and removing unnecessary licenses.
🔒 Support cost reductions
By eliminating unused licenses from S&S renewals.
🏢 Unified IBM governance framework
Across U.S. operations, preventing future audit risk and overspend.
Don't Wait for the Audit Letter
IBM audits are not if, but when—and when it comes, the 30-day response window leaves no room for error.
Let LDS secure your IBM estate—before you're staring at a $6M compliance letter.
Frequently Asked Questions
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Contact us today to learn how we can support your Software Asset Management goals—with clarity, control, and confidence.
Audit Defense
Cost Optimization
Flexera Implementation
Compliance Management
