Compliance Status Meanings
Every product on the Licensing Position falls into one of three compliance statuses. This page explains what each one means and what to do about it.
The Three Statuses
| Status | What It Means | Recommended Action |
|---|---|---|
| Compliant (green) | Entitlement equals or slightly exceeds consumption | No immediate action. Review periodically to catch drift. |
| Over-licensed (blue) | You own significantly more licenses than needed | Evaluate whether excess licenses can be reassigned, allowed to lapse at renewal, or sold (if the license type permits transfer) |
| Under-licensed (red) | More installations than licenses — this is a compliance risk | Either purchase additional licenses or identify machines where the software can be uninstalled |
How the Status Is Computed
The status is derived from two columns on the Licensing Position:
- Required = total consumption in metric units
- Allocated = total grants from in-service licenses
The math:
| Condition | Status |
|---|---|
| Allocated >= Required | Compliant or Over-licensed |
| Allocated < Required | Under-licensed |
The line between Compliant and Over-licensed is judgement — a product with 50 seats covering 49 users is "compliant" rather than "over-licensed". Most teams treat anything within 10% as healthy, anything significantly higher as worth reviewing for renewal trimming.
Compliant Doesn't Mean Done
A green status today is not a permanent state. New installs happen continuously. Regular recalculation is what keeps "compliant" honest:
- Without scheduled recalculation, the position becomes stale
- Without periodic data quality checks, hidden problems (missing license types, broken defining titles) silently produce false-compliant readings
Schedule the calculation (see Operations: Scheduling and Monitoring) and review the Licensing Calculation Steps tab monthly (see Operations: Data Quality Checks).
Under-Licensed Is a Risk
Being under-licensed exposes you to:
- Vendor audits. Microsoft, Adobe, Oracle, and others run audits and impose true-up costs and penalties for under-licensing.
- Operational risk. Unlicensed software in use is a contractual breach. Some vendors can force removal at the worst possible time.
- Cost surprises. A product showing red on the position is potential unbudgeted spend if you cannot remediate by removal.
Address red statuses promptly. The remediation paths:
- Buy more licenses to close the gap
- Remove the software from machines that do not need it
- Reassign existing licenses if your environment has a mix of over and under
The Licensing Position drill-in shows which specific machines are uncovered, so you can target the remediation precisely.
Over-Licensed Is Cost Optimization
Significantly over-licensed products represent unused spend. The remediation:
| Pattern | Action |
|---|---|
| Per-user subscriptions you over-bought | Reduce the seat count at next renewal; vendor portal often supports mid-term reductions |
| Per-device licenses for retired hardware | Reclaim the seats by disposing the assets in xAssets (consumption ends, capacity is freed) |
| Unallocated capacity from a multi-year EA | Plan to reduce at renewal, or use the surplus for upcoming projects |
| Licenses purchased for projects that never materialized | Investigate transferability; some perpetual licenses can be resold |
Cost optimization is often overlooked. Most teams focus on closing under-licensed gaps, but the same data tells you where you have over-bought, and acting on that produces real savings.
Status by Product Class
Different product classes have different typical statuses:
| Class | Typical Pattern |
|---|---|
| Microsoft Office / 365 | Should be compliant — well-defined per-user math |
| SQL Server | Often slightly under-licensed because of CORE4 minimums and missed instances |
| Adobe Creative Cloud | Often over-licensed because procurement is bursty (annual VIP renewal) |
| Niche tools (specific developer tools, etc.) | Often unlicensed in xAssets — caught only when a license audit happens |
| OS licenses (Windows) | Should be compliant — OEM automation handles most |
Patterns vary by environment. The point is to expect different products to behave differently.
When the Status Surprises You
If a status is wrong relative to your understanding:
- Check the Required column — does it match what you know is installed?
- Check the Seats column — does it match what you know you own?
- Drill into the product and look at the per-machine list — does it list the right machines?
- Check the catalog entry's License Type — wrong type produces wrong metrics
If all four check out and the number still surprises you, you may have a real surprise — investigate which is inaccurate, your understanding or the data.
Related Reading
- The Licensing Position Query — the data behind the status
- Compliance Reports — reports for management and audit
- Daily Tasks: Identify Under-Licensed Products
- Daily Tasks: Audit Preparation