How to Control Costs of Your Microsoft 365 Licensing for Business

M365 license management tips

It’s no secret that Microsoft licensing ecosystem is complex. Microsoft loves SKUs and M365 is no exception. They are constantly adding, changing, and deleting new applications and features daily within the Microsoft ecosystem. Staying up to date on all these changes and purchasing the right license for your employees can be time consuming and downright confusing. The truth of the matter is, managing your Microsoft 365 license subscriptions does require regular attention (and maintenance) from someone in your organization to ensure you’re keep your licenses and costs under control.   


Understand your various work group needs to know which M365 Licensing to Purchase for them

When you buy a subscription to Microsoft 365 for business, you sign up for a set of apps and services that you pay for on a recurring basis (monthly or annually). The applications and services that you receive as part of your subscription depend on which license you purchased.  

You specify the number of licenses that you need, based on how many people you have in your organization. Then after you buy a subscription, you create accounts for people in your organization, and then assign a license to each person. As your organizational needs change, you can buy more licenses to accommodate new people, or reassign licenses to other users when someone leaves your organization. Sounds easy enough, right?  

If everything was black and white it would be much easier, but your various work groups or departments will likely have different licensing requirements and needs!

Some job functions may require a higher level of security. For example, your executive leadership team and finance department should always have additional layers of security because they are they are the ones who make monetary transactions and deal with sensitive or proprietary business information. Anyone in your IT department who has elevated administrative credentials to critical business applications will also require a higher level of security. As such, they are the perfect target for a phishing attack. In these scenarios, there are specific licenses designed to protect these high profile, targeted users. 


With Microsoft licensing, you have the flexibility to mix and match your licensing depending on your user needs, this is one way to reduce licensing costs. 

Remove and reclaim licenses from departing employees

Another way to keep costs down is to make sure you regularly remove, reclaim or repurpose licenses for employees who leave your organization. Having good alignment between your Human Resources department and your IT department will help you keep better tabs on your licensing subscriptions by actively onboarding and off boarding licenses as employees come and go. Once you identify unused licenses from your disabled or deleted users, you can then reclaim or restore them for a new user.

Specialized user licensing options

If you operate a manufacturing plant with several manufacturing kiosks throughout the warehouse, all shop employees should be licensed with a low cost subscription designed specific for shared kiosk usage. This same license can also be used in healthcare environments in nurse stations or medical carts.

Capitalize on Annual Renewal Discounts  

Microsoft now offers annual renewal plans at a 20% discount compared to the monthly subscription model. If the capital is available, this sounds like a no brainer, right?  However, there are a few caveats to consider. If you have seasonal employees, this may not make sense for them. In order to accommodate a seasonal workforce, simply purchase monthly licenses for the group.

ANP is a Microsoft Cloud Service Provider (CSP) that participates in the Microsoft New Commerce Experience which is MS new licensing program. These are just a few examples of ways ANP helps our Microsoft 365 managed services customers control their Microsoft 365 licenses costs and subscriptions.  If you would like a Complimentary Licensing Audit, talk to your vCIO or contact us today to get started! 

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