Microsoft 365 licensing is one of the most common sources of quiet overspending in small organisations. Not because the plans are unreasonable, but because nobody revisits who is on which one.
This is a plain description of the main plans for organisations under three hundred users, and the mistakes worth checking for.
Business Basic
Email, calendars, files in the cloud, Teams and the browser versions of Word, Excel and PowerPoint. No desktop applications installed on the machine.
It suits people who work mostly in email and Teams: reception, warehouse, field staff, volunteers. Many organisations put everybody on a higher plan when a third of the team would never notice the difference.
Business Standard
Everything in Basic, plus the desktop applications installed on up to five computers and five mobile devices per person.
This is the normal plan for office staff who work in documents and spreadsheets all day, particularly where large files or offline working matter.
Business Premium
Everything in Standard, plus the security and device management pieces: conditional access rules, device enrolment, information protection and the tools for wiping a lost device.
The security content is the reason to choose it. If your organisation holds personal data, works with the public sector or handles money, this is usually the plan that earns its cost, because buying the same protection separately costs more.
Apps for Business
The desktop applications and cloud file storage, with no business email from Microsoft.
It is useful in a narrow case: an organisation whose email sits somewhere else and is staying there. Choosing it by accident, when you do want Microsoft email, causes a confusing setup.
The mistakes we see most
- Leavers still licensed. The account is disabled but the subscription keeps renewing. Check the licence count against your payroll count.
- Everybody on the same plan. Mixing plans by role is allowed and usually cheaper.
- Paying monthly on an annual commitment. The two are priced differently. Check which one you are on.
- Shared mailboxes with a full licence. A shared mailbox such as an enquiries address does not need its own paid licence in most setups.
- Premium features bought twice. Organisations on Premium sometimes also pay for a separate product that does the same job.
- No record of who approved what. Subscriptions added by different people over the years, with nobody holding the list.
A check you can do this week
Export the list of licensed users from the Microsoft admin centre. Put it next to your staff list. Mark every name that should not be there, every person whose plan is higher than their work needs, and every licence with no name against it at all.
In most organisations of thirty to sixty people, that exercise finds several licences that can be removed or downgraded at the next renewal.
A word on the security plan
If you are weighing Standard against Premium, the question is not whether you need the extra features today. It is whether you would want them the week after a staff member loses a laptop on a train.
Premium gives you the ability to require a second factor properly, to control which devices can reach your files and to wipe a single device remotely. Those are the three things people wish they had at the point they need them.
Running the licence review, step by step
This is the exercise itself, in the order that produces the fewest surprises. It takes an afternoon the first time and about twenty minutes when repeated.
1. Export the licensed users. From the Microsoft admin centre, take the list of accounts with a licence assigned. Export it rather than reading it on screen, because you are about to compare it against another list.
2. Get your staff list from payroll or HR. Not from anybody’s memory. The gap between these two lists is the whole point of the exercise, and in most organisations it is larger than expected.
3. Mark the names that should not be there. Leavers, contractors whose work ended, and accounts nobody recognises. Do not delete anything yet. Removing a licence from an account also starts a clock on that person’s mailbox and files, so decide first what you need to keep.
4. Mark the plans that are higher than the work needs. Go through by role rather than by person. Reception, warehouse, field and volunteer roles often work entirely in email and a browser. Office staff who live in documents need the desktop applications. Mixing plans is allowed and is usually cheaper.
5. Find the licences with no name against them. Subscriptions bought for a project, a second licence added during a busy week, a plan somebody trialled. These are the easiest saving in the whole list because nobody will notice.
6. Check the shared mailboxes. An enquiries or accounts address does not need its own paid licence in most setups. Paying for one is common and easy to correct.
7. Look at the billing term. Monthly and annual commitments are priced differently. Check which you are on, and whether switching at renewal would save anything on the licences you are certain to keep.
8. Write down the renewal date and who approved the change. Then put a reminder two months before it. Licence counts drift every single year, and a dated reminder is what turns this from a one off tidy up into a control.
Two cautions. Do not remove a licence from a leaver until their mailbox and files have been dealt with, and do not downgrade somebody mid project without telling them what they will lose. Both save money and cost goodwill if done quietly.
Where to read more
Our Microsoft 365 page covers setup, migration and licensing reviews. Security features that sit alongside the licence are on the cybersecurity page.
Send us your licence list and we will tell you what we would change, including where you are paying for something you already have.