Client Profile
At a Glance
🚨 The Challenge
The automotive manufacturer received an unexpected IBM audit with non-compliance claims totalling €10 million. The audit findings pointed to licensing issues across their expansive IT infrastructure.
- Complex virtualised environments across multiple sites
- Cloud deployments alongside on-premises infrastructure
- Vehicle design and testing development systems
- Decentralised licence management across operations
- Alleged discrepancies in sub-capacity licensing and PVU metrics
- Risk of production disruption during audit process
✅ The Outcome
Redress Compliance reduced the alleged non-compliance fees by 96% — from €10 million to just €400,000.
- Final settlement of €400,000 (only for genuinely new deployments)
- €9.6 million in alleged penalties eliminated
- IBM accepted the revised compliance report
- Zero disruption to operations or production schedules
- Centralised licence management implemented
- Real-time usage monitoring processes established
💰 Audit Claim Resolution
The final €400,000 settlement covered only the cost of additional licences required for genuinely new deployments. The remaining €9.6 million was eliminated through corrected PVU calculations, virtualisation policy reinterpretation, licence reallocation, and identification of overestimations in IBM's audit methodology.
Our Process
Redress Compliance provided end-to-end IBM audit defence, working directly with the company's IT, engineering, and procurement teams to systematically challenge and dismantle IBM's audit findings.
Audit Report Analysis
Meticulously reviewed IBM's audit findings, identifying overestimations and errors in licence usage calculations. Analysed the company's IBM agreements and entitlements to establish a baseline for legitimate software usage. Mapped each claimed shortfall to the specific licensing rules and contract terms IBM had cited — and identified where those interpretations were incorrect or overly aggressive.
Data Collection & Validation
Collaborated with IT and engineering teams to gather accurate data on IBM software deployments across all environments — physical servers, virtual machines, cloud platforms, and vehicle design and testing systems. Validated sub-capacity licensing calculations with a focus on server configurations, virtual machine metrics, and development tools. Identified unused licences and misconfigurations that had contributed to IBM's inflated audit claims.
Negotiation Strategy & Execution
Engaged directly with IBM's auditors to present corrected usage data and challenge their findings point by point. Highlighted the company's ongoing compliance efforts and significant investment in IBM software, leveraging these points to negotiate favourable terms. Addressed specific discrepancies in PVU calculations and virtualisation policies that significantly reduced the scope of non-compliance — dismantling the majority of IBM's €10 million claim.
Compliance Optimisation & Future-Proofing
Reallocated licences within the organisation to close remaining compliance gaps without additional purchases wherever possible. Proposed a long-term licence management strategy to ensure compliance with IBM's terms while supporting the company's innovation-driven IT environment. Recommended tools and processes to monitor real-time usage and avoid future audit risks — including centralised licence tracking and ILMT deployment improvements.
"The IBM audit was a significant challenge, but Redress Compliance's expertise turned the situation around completely. They saved us millions and provided a clear path to maintain compliance as our IT systems grow. Their support was instrumental."
Key Takeaways
IBM audits in complex, multi-site manufacturing environments often produce dramatically inflated claims — particularly where virtualised infrastructure, cloud deployments, and specialised development systems are involved. IBM's audit methodology frequently overestimates PVU requirements by failing to correctly apply sub-capacity licensing rules to complex virtualisation configurations. In this case, 96% of IBM's €10 million claim was eliminated once accurate data was collected and correct licensing interpretations were applied. Organisations in technically complex industries should challenge IBM audit findings as a matter of course, rather than accepting them at face value. The combination of accurate deployment data, correct licensing interpretation, and strategic negotiation can reduce audit exposure by millions.
Facing an IBM Audit?
Redress Compliance has defended hundreds of organisations against IBM licence audits — routinely reducing claims by 80–100%. Our independent advisory ensures you only pay for what you legitimately owe, with no vendor ties or conflicts of interest.
📖 Related Case Studies & Resources
- Case Study: IBM Audit Defense for a US University
- Case Study: IBM Audit Defense for a US Medical Hospital
- Case Study: IBM Audit Defense for a UK Pharmaceutical Company
- Case Study: IBM Audit Defense for a Large US Media Company
- IBM Licensing Case Studies: Eliminating Risk & Cutting Millions
- Enterprise Guide to IBM Licence Audits
- IBM PVU Licensing: A Practical Guide
- IBM ILMT: Sub-Capacity Licensing Advisory
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Learn more →Fredrik Filipsson
Fredrik Filipsson brings 20+ years of experience in enterprise software licensing, having worked directly for IBM, SAP, and Oracle before co-founding Redress Compliance. He has defended hundreds of organisations against IBM licence audits across automotive, manufacturing, pharmaceutical, financial services, and technology sectors — routinely eliminating or dramatically reducing compliance claims. Redress Compliance maintains complete vendor independence — no commercial relationships or referral fees from any software vendor.