The pandemic ignited a wave of digital transformation that saw organizations quickly adopt new cloud technologies to power remote work.
Digital transformation occurs when businesses implement new technologies to enhance processes and meet the demands of a rapidly evolving world. It also requires a new type of digital maturity to handle the complexities of a distributed workforce.
“Adopting new technology is a starting point, but how will it drive business outcomes?” asks Justin Grossman, CEO of meltmedia in a Forbes column. “All too often, success is defined as implementation, not impact.”
Digital maturity ultimately comes down to how organizations create value from their cloud investments. We’re beginning to see businesses shift focus from digital transformation to establishing systems for long-term digital success.
For SaaS, it involves tracking metrics, such as cost of SaaS per employee, adoption and utilization rates, and regularly rationalizing your applications to determine which tools need replacement, retirement, or consolidation.
However, before you can begin to put these practices into place, you need to understand where your organization sits on the digital maturity spectrum.
The 4 Stages of the Digital Maturity Spectrum
So, how do you know where your company lands on the digital maturity spectrum? According Grossman, organizations usually fall into one of four digital maturity categories, such as:
- Incidental: Organizations with incidental digital maturity may implement a couple of digital transformation initiatives, but they almost always happen by accident, not as a strategic business endeavor.
- Intentional: These companies intentionally implement initiatives to support digital transformation but fail to operationalize and automate efforts across the organization.
- Integrated: Organizations on the integrated spectrum strategically enact multiple initiatives to support digital transformation and put well-coordinated processes in place to measure the business impact. Senior leadership understands the need for and supports these initiatives.
- Optimized: These organizations operationalize digital transformation in a coordinated and automated way across all business functions. New technologies seamlessly integrate into existing systems. Optimized businesses embrace digital transformation as a meaningful component of company culture and organizational agility.
What Does a Mature SaaS Management and Optimization Strategy Look Like?
SaaS continues to grow in utilization due to the ease of acquisition and low costs, but it also results in many organizations having an abundance of unmanaged SaaS, or shadow IT. It invites problems like redundant and duplicative licenses, security and compliance issues, and wastes budgets.
SaaS Management and optimization proves key to a mature program. To accomplish this, you must effectively manage your technology stack and focus on establishing a foundation for your digital success.
To get started, we suggest you start tracking usage and cost metrics, including cost of SaaS per employee, adoption and utilization for each license, as well as overlap and duplicate functionality.
For a more comprehensive strategy, let’s take a look at how Adobe partnered with Zylo to implement organizational-wide procedures to take control of their SaaS Management. However, before teaming up with Zylo, their outlook fared much differently.
“There was a lack of user data. We had no clue of what was installed, how many products were being used, or how many users were there,” says Rai, Director of the Office of the CIO at Adobe, in a recent session from our SaaSMe event. “That was causing all kinds of problems for us.”
Today, Adobe uses more than 50 direct integrations with Zylo, and they’re on track to reduce their roughly 2,400 applications to 500 with the SaaS Management tool.
Check out some of Adobe’s core learnings from building their SaaS Management process.
Start with executive buy-in
Rai says you absolutely need executive buy-in, or even better, executive sponsorship, to effectively implement company-wide procedures. It allows you to forge cross-functional partnerships with key layers and business units across the organization.
Put the right people, processes, and tools in place
“The second thing we realized is we need people, processes, and tools to support this program,” Rai says. “We did everything possible with our initially-limited resources.”
Lupe Banuelos, Adobe’s Sr. Program Manager of Software Asset Management adds: “We needed to find a tool that could give us the information we needed, as well as provide services to help our small team operate. We couldn’t have put a report or generated any kind of tool to give us the insights that Zylo has given us.”
Establish ongoing standards, with a focus on compliance and alignment
SaaS Management requires ongoing governance. Rai and Banuelos stress putting standards in place for establishing approved software applications to reduce redundancy and prevent unwanted applications from entering the business. Part of the continued surveillance requires making sure your licensing agreements support business initiatives, while promoting alignment between vendor management and procurement teams.
Digital Maturity and Emerging Tech Trends for 2022
As SaaS continues to thrive, it becomes increasingly clear only the digitally dexterous will succeed in the future. To stay abreast of the latest trends impacting the SaaS space, check out Zylo’s Top 5 SaaS Trends for 2022.