Over the past four years, we’ve seen a shift in focus from growth at all costs to responsible growth and cost efficiency amid ongoing economic challenges. Today, there’s significant opportunity for increased ownership, dedicated SaaS optimization initiatives, and reinvestment in innovation. The 2024 SaaS Management Index highlights the size and cost of those opportunities if you don’t take action. Below you’ll find a few key insights from our research. Download the full report below for a fresh perspective on SaaS management and how you can achieve better business outcomes in the coming year and beyond.
Unchecked SaaS Sprawl Leads to an Average of $18M in License Waste Annually
License waste is the top challenge reported by IT and Software Asset Management professionals. The harsh reality is you’re wasting more licenses than you know. On average, companies use just half (49%) of their SaaS licenses. That means 51% are sitting on the shelf – paid for, but not used.
The cost of unused licenses adds up. On average, a company wastes $18M a year – a 7% increase from 2022. But it differs by company size. Small companies see an average waste of $2M per year, while it balloons to a staggering $127M for large enterprises.
Clearly there’s a huge opportunity to prioritize SaaS license optimization as a means to cut costs in 2024. It’s time to put that waste in check!
65% of Expensed SaaS Apps Carry Significant Security Risks
Expensed SaaS apps – or shadow IT – are often purchased outside of policy, meaning they reside in your stack unvetted by Infosec. As a result, they increase your attack surface and open up your company to more risk. Upon analyzing our spend data alongside Netskope’s Cloud Confidence Index™ (CCI), we found that two-thirds of expensed software is considered to have a “Poor” or “Low” risk score.
Considering that shadow IT makes up 35% of your portfolio, that’s a lot of applications introducing significant risks to your business. It’s no surprise that 82% of IT and SAM professionals say reducing security risks is a top business priority for 2024. To reduce risk, you must prioritize visibility into hidden SaaS purchases and governance to keep it in check.
In today’s workplace, the breadth of tooling and flexibility is great for productivity. But it means IT, Cybersecurity, and Finance teams must enable it without putting the enterprise under more stress or risk of a malicious or inadvertent breach or loss of data, let alone inefficient spending.
— David Willis
VP of Technology Integrations at Netskope
70% of IT and SAM Leaders Use Legacy Tools and Spreadsheets, Leaving Waste, Shadow IT, and Security Risks Unchecked
License waste, shadow IT, and security risks are an enormous problem for a majority of IT and SAM leaders today. Despite recognizing these challenges, most believe they have a handle on their SaaS stack.
But there’s a gap between perception and reality. In fact, 70% of survey respondents think their SaaS tracking methods are accurate, yet they’re still using legacy tools or spreadsheets to track SaaS. Neither approach is known for accurate or effective SaaS discovery. Spreadsheets are quickly outdated, error-ridden, and provide insufficient data. And legacy tools don’t even touch the renewal process.
Modern tools like SaaS management platforms are purpose-built to address the unique challenges that the explosion of SaaS growth has presented. The key difference is complete and ongoing discovery, categorization, and centralization of all software within your business.
On-premises software tools don’t give you the SaaS management and SaaS visibility that you need. You can’t run with just one tool in the software asset management space.
— Jason Owens
Senior Director, Asset Management at Salesforce
Get SaaS Management Insights
SaaS management is an enormous challenge today for companies of all sizes. From software bloat and license waste to unruly spending and unknown security and compliance risks.
The 2024 SaaS Management Index highlights key SaaS trends and insights to help IT, Software Asset Management, and Procurement leaders like you sift through the noise and understand the impact of effective SaaS management.
Get a copy of the report for insights into:
Trends in SaaS risks, usage, and spending
Key data points to benchmark against your peers
Optimizing and realizing the value of your SaaS investments