Case Study: IBM Audit Defense for a California Government Entity
Challenge
A major government entity in California responsible for public services and infrastructure faced an IBM audit with alleged non-compliance claims amounting to $30 million. The organization’s IT systems supported critical functions such as citizen data management, public safety networks, and municipal services. IBM’s findings cited discrepancies in sub-capacity licensing, entitlement mismatches, and usage metrics across virtualized environments. With tight budgetary constraints and the need to ensure uninterrupted public services, the entity engaged Redress Compliance to manage the audit and safeguard its operations.
The Process
- Audit Review and Strategy Development: • Redress Compliance conducted an in-depth analysis of IBM’s audit report, identifying errors in license usage calculations and entitlement mapping. • Examined historical agreements and deployment data to establish an accurate compliance baseline.
- Data Collection and Validation: • Partnered with the government entity’s IT and procurement teams to collect detailed usage data from servers, cloud platforms, and virtualized environments. • Validated sub-capacity metrics, uncovering significant overestimations in IBM’s findings. • Identified underutilized licenses and misconfigurations that could be optimized to address compliance gaps.
- Negotiation with IBM: • Presented a revised compliance report to IBM, backed by accurate data and a clear interpretation of licensing policies. • Highlighted the government entity’s critical role in providing public services and its investment in IBM technologies. • Secured major concessions by challenging ambiguous claims and emphasizing the need for budget-conscious solutions.
- Optimization and Governance: • Reallocated unused licenses to close compliance gaps without incurring additional costs. • Designed a compliance framework with automated tracking tools to ensure real-time monitoring and long-term adherence to licensing terms. • Delivered training for IT and procurement teams to enhance understanding of IBM licensing requirements and prevent future risks.
Outcome
Redress Compliance successfully reduced the government entity’s financial liability by 97%, bringing the $30 million claim down to $900,000. This settlement covered only the cost of additional licenses required for specific new deployments. The entity avoided any penalties and maintained uninterrupted delivery of public services throughout the audit process. Robust compliance processes were implemented, ensuring future audit readiness and effective license management.
Quote from the CIO:
“The IBM audit posed a significant risk to our operations and budget, but Redress Compliance delivered extraordinary results. Their expertise saved us millions and left us with stronger compliance practices. Their guidance was invaluable to our organization.”
Key Results:
- Initial Audit Claim: $30 million.
- Final Settlement: $900,000 (97% reduction).
- Compliance Enhancements: Centralized license management and real-time monitoring systems.
- Business Continuity: Ensured uninterrupted public services during the audit process.
This case highlights Redress Compliance’s ability to deliver outstanding outcomes for public sector organizations, safeguarding both financial stability and operational continuity during complex IBM audits.
