Microsoft Billing Cycles.
On March 10th 2022, Microsoft introduced their New Commerce Experience (NCE). Many existing license consumers committed to purchasing licensing over 12 months to minimise the overall purchase cost. This model delivers the minimal cost but doesn’t deliver flexibility to reduce the license count monthly.
Consider the following strategic points
Flexibility vs. Cost Savings:
Monthly Licenses: Offer greater flexibility, allowing customers to adjust their license count based on fluctuating needs. This is ideal for businesses with seasonal variations or those anticipating significant changes in their workforce.
Annual Licenses: Provide cost savings, as they are typically priced lower than monthly licenses. This is suitable for stable, long-term needs where the number of users is unlikely to change significantly
Ideal Split for Strategic Planning:
Core Workforce: Allocate annual licenses to the core, stable workforce. This ensures cost efficiency for employees who will consistently need access to Microsoft services.
Variable Workforce: Use monthly licenses for temporary, project-based, or seasonal workers. This allows for easy scaling up or down without long-term commitments.
Example Split:
- 70-80% Annual Licenses: For the core team, ensuring cost savings.
- 20-30% Monthly Licenses: For flexible, short-term needs, providing adaptability
Benefits of This Approach
Cost Efficiency: Maximizes savings on long-term commitments while maintaining flexibility.
Scalability: Easily adjusts to changing business needs without overcommitting resources.
Simplified Management: Streamlines billing and subscription management by aligning license types with workforce stability.
Conclusion
By strategically splitting licenses between monthly and annual terms, businesses can optimise their costs and maintain the flexibility needed to adapt to changing circumstances.
If you are looking for a more strategic approach to purchasing Microsoft licensing for your organistation, please get in touch by emailing social@itlifeline.co.uk
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