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Best Practices for SaaS Management

02/12/2020

The subscription economy has changed behaviors. The subscription economy impacts our personal and professional worlds in profound ways. From beauty products and clothes to food, music, and razors, there is a service to subscribe to almost anything in our personal lives. Subscriptions do not stop in the professional world either.

The SaaS Explosion Creates Problems

The shift to the Cloud is leading to subscriptions being purchased by more and different departments. Unfortunately, the ease of purchase makes it harder than ever for the enterprise to successfully manage the growing number of subscriptions and providers.

These trends are creating a number of common challenges in the enterprise, including:

  • Lack of visibility for all technology purchases
    Without one system or process, it is impossible to track all technology in use.
  • Increased security risk
    Without knowledge of all technology in use, there is an unknown risk with each application.
  • Redundant functionality across applications
    Without a full catalog of applications in use, it is highly likely there is duplicative technology.
  • Reactive SaaS renewals
    Without a comprehensive renewal calendar, it is difficult to stay ahead of renewal negotiations.
  • Increased operational burden
    Without a real-time analysis of transactions processed for each application, it is hard to uncover time and cost savings opportunities.

Managing SaaS Presents Strategic Opportunities

The shift to the Cloud also presents organizations with a new model for how software can be deployed and used. With easy access and few requirements, SaaS makes it easy for businesses to get the tools they need quickly without burdensome support needs.

New, tools can be adopted faster – while new tools can be offboarded with ease – creating the opportunity to spur innovation and organize resources with best-in-class tools.

Organizations that actively manage their SaaS have increased opportunity to:

  • Identify SaaS application value
    Knowing if employees are actively using each application (or not!) is an indicator if the business is getting the desired value.
  • Accurately forecast technology budgets
    With a clear understanding of technology cost per cost center, department, and employee makes it possible to forecast technology budget growth more accurately.
  • Quickly assess technology assets for M&A growth
    Technology investments are a strategic and large expense category and should be factored into pre- and post-merger acquisition assessments.
  • Managing license optimization in real-time
    Employees’ needs and access to technology are evolving. Keeping up with those needs is complex without having real-time utilization information and trends.
  • Create an enterprise-wide SaaS strategy
    Creating a comprehensive technology strategy around budget, risk or overall effectiveness is impossible without accounting for all SaaS in the organization.

Now is the time for the enterprise to increase the strategic value in the SaaS subscription management and optimization process to ensure a secure data environment, promote collaboration across the business, and ultimately drive technology cost efficiency.

5 Best Practices For SaaS Management

1. Scale SaaS governance based on risk & impact

It is nearly impossible to lock down all technology purchasing, and often stifling to an organization to do so. However, creating different levels of governance and control based on the investment amount and impact across the business is a good balance.

When the business can take increased responsibility in the smaller, less strategic technology investments and management, the organization can still maintain the speed and agility to benefit from new technology and have less exposure to risk in the larger, strategic applications that are still managed in a more traditional way.

2. Treat SaaS technology as a strategic asset

SaaS technology is a growing spend category in tech-forward and traditional enterprises. Technology budgets are always scrutinized and often cut because it is hard to justify the expense and impact on the business.

With a SaaS system of record, the ability to monitor real-time expenses, proactively prepare for renewals and adjust license deployments as needed, makes it an easier conversation to prove the impact and value each application provides. SaaS budgets can now grow in cost-efficient ways that scale with the business.

3. Empower line of business owners to create accountability

Technology is purchased across the enterprise today and the role of IT is shifting to lead the overarching technology strategy, security initiatives, and the flow of data and integrations among systems.

For the lower cost and less strategic applications, empowering the business to manage their own solution research, trials, implementation, and even administration is a big shift, but one that allows IT and Finance to maintain the centralized view and get involved only as needed for security, contract negotiations or other strategic reasons.

4. Champion internal training & adoption campaigns for SaaS

For the most strategic SaaS applications that contribute directly to the success of the enterprise, now it’s possible to analyze which areas of the business need more training or a push for increased adoption. Technology is a differentiator for most enterprises and often the business’ success depends on how well the entire organization uses technology to differentiate its product, service, or offering in the marketplace.

Identifying which applications are critical to each area of the business and partnering with the leaders in that area to create engagement and training is an impactful way to drive value and create a more collaborative environment.

5. Manage SaaS licenses in real-time

Understanding the cost per license and cost per employee provides actionable intelligence to save money with real-time license management practices. Managing SaaS licenses on a regular cadence is the most effective way to avoid unused license costs or unknown over-utilized cost surprises.

Working with business leaders to create a license management process for the largest SaaS deployments is critical to ensure open lines of communication produce a collaborative environment.

SaaS is More than Managing Technology – It’s People, Too

Half of the challenges around SaaS optimization have less to do with the actual technology solutions and more to do with the leadership and management approaches in the enterprise. Creating a unified viewpoint on how SaaS applications will be supported and developing strong business relationships across the enterprise ensure that whatever process or system is applied, it’s one that works.

Whether it starts with a spreadsheet and a regular stakeholder meeting or with a robust SaaS platform, SaaS management will continue to be a growing focus area and priority to drive innovation, identify cost savings opportunities and support overall business growth.

Ready to get started on your SaaS management journey? Zylo is here to help. Book a demo of Zylo’s SaaS management platform today to better understand and optimize your SaaS investment.