Imagine your company is on television. You're on the show “COPS,” not for standard fare like unpaid parking tickets or burglary, but instead you're being dragged out of your yard's front office in cuffs by the software police for IT violations. The next thing you know, you're in front of a judge swearing to tell the truth, the whole truth, and nothing but the truth: You had no idea your company was using software illegally. You wonder where you went wrong as they throw the book at you and your company.

Have you ever felt like you worked smarter and harder than ever, only to be usurped by disastrous losses? You've trained for 12 months, managed your expenses and margins. Morale is up. Profits are up. You're expecting another record year. But then all of a sudden you're caught in a scandal revolving around non-compliant software. While it may not seem like something that would attract the attention of the authorities and the media, don't be so sure that you won't end up on prime time if you choose not to monitor the programs that your company uses and how they are rolled out to PCs.

The truth today is that if somebody loads illegal copies of software onto one or more computers in your company, even if you were unaware, your legal and financial future are at risk, and you can expect a visit from the software police.

Who are the software police? In 1988, a watchdog group called the Business Software Alliance (BSA) was formed to promote a safe and legal digital world. BSA realized that in 2002, 32 percent of the software in the United States was illegal. Surprisingly, most companies do not realize the exposure and potential fines associated with noncompliance.

To ensure that you are in compliance, verify that you have one license for each software program in your company. License information can be stored in simple file folders, but make a backup copy of the license numbers and place these off site as part of your disaster recovery plan.

Larger organizations should use software tools like GASP and WebCensus, software and hardware auditing tools that can identify and track licensed and unlicensed software on computers and networks. They can be downloaded for free on BSA's Web site,

Initially, only larger companies were monitored for software compliance. But now the group is also taking a look at smaller businesses. Don't be surprised if somebody knocks on your door and asks if you are in compliance.

Don't gamble with your future. In the grand scheme of your business model, most software is inexpensive. Developers should be compensated for their intellectual property, and the legal and monetary issues of noncompliance can put your entire company under investigation. If you wait for the officers to come to the door with a warrant in hand, you may end up taking the heat. —Chris Rader is president of Rader Solutions, a Lafayette, La.–based management information, education, and training consulting firm for the construction supply industry.