SaaS (Software-as-a-Service) tools main characteristic is that they are cloud-based and do not rely on hardware as much as enterprise solutions do. SaaS tools are also more dynamic and more affordable than the enterprise tools, making them the best solution for startups and SMBs. However, big enterprise companies are starting to see the same value and many are trying to catch up with this trend by replacing their robust enterprise software tools with cloud-based SaaS tools. This is why tools usage and spending has been on the rise among companies in recent years. According to Statista, the SaaS market will grow to a whopping $157 billion dollars in revenue this year! The average US SMB is expected to spend around
$20,000 on SaaS tools each month in 2020. This represents nearly twice the total amount companies spent monthly on software only three years ago!
This incredible growth can also be attributed to the tremendous value these software tools bring to all the different teams within a business (sales, engineering, marketing, HR, etc.) since they are typically easy-to-implement and easy-to-use. This impressive rise in SaaS tool usage is often referred to as the SaaS revolution, and with more than 19,000 SaaS companies in the market (based on CrunchBase’s database as of June of 2020) this trend is not stopping any time soon.
This article explains what SaaS Management is and what needs to be done to successfully navigate this increasingly important and complex landscape. How can SaaS consumers take advantage of the thousands of great software tools out there without overspending? It is great for businesses to have all these awesome business solutions and resources on the palm of their hand, but how can they keep track of the huge variety of software subscriptions?
What is SaaS Management?
In a nutshell, SaaS management is the process of assessing, procuring , maintaining, renewing, replacing, re-evaluating, and tracking all the different SaaS tools subscriptions or licenses in a company’s tech stack. Companies might use the term SaaS Management differently depending on their size and industry. Often referred to as Software Asset Management while others call it IT Management or simply consider it part of IT procurement, as it is accomplished by the procurement team. However, all of these different names refer to the same tasks and responsibilities that are necessary to achieve the same SaaS management goal, which is to have the best software solution for the team and a clear understanding of all the software used by the employees within an organization in order to improve productivity and efficiency within budget.
Although the goal of SaaS management is very straight forward, many companies struggle with identifying the steps they must take to achieve it. On the other hand, if the steps have been identified, they oftentimes are not done correctly and many companies end up wasting a significant amount of limited resources.
Therefore, it is important to identify the different aspects of SaaS management that all companies, big and small, must keep in mind to succeed:
- IT procurement
- Tool implementation
- Software license management
- Employee provisioning (onboarding and offboarding)
Let’s dig into them.
IT procurement also referred to as software vendor management is the process of acquiring information technology, including SaaS which today is the main Software category for SMBs. Hence, most small and medium-size businesses prefer to use the term SaaS tools or business software over information technology. Procurement has been mostly considered to be a step taken before SaaS management, however it is in fact a crucial part SaaS management as the flexibility they offer means today SaaS tools are implemented and replaced constantly to adapt to the businesses continuously adapting needs.
Within IT procurement, companies must identify the right and most cost-effective SaaS tools for their teams, which represents a significant challenge. As mentioned before, there are over 19,000 SaaS products available and, although having many great options is wonderful, it makes it difficult to identify which options are the best for the organization. Therefore, companies must speak to multiple SaaS vendors simultaneously to understand the value each solution brings to the company and negotiate the best deal. However, because this task is time-consuming and challenging, companies oftentimes end up choosing the cheapest or best recognized tools rather than those which best fit their needs.
The solution is often found in third-party companies that can take over IT procurement, such as Gartner. This option is very expensive, but big companies with hundreds of employees are willing to pay the price because they can save money in the long run. However, small and medium-sized companies do not have the financial resources to incur big expenses with their limited budgets, which leaves them with the only option of having to look for a marketplace that offers pre-negotiated SaaS deals, such as Appsumo and onetool. Read more about IT-procurement here.
Once companies find the right tool for their teams, they must focus on implementing these tools into the workflow as seamlessly as possible. Most SaaS tools understand the importance of developing products that are easy-to-implement. Therefore most user-friendly SaaS tools usually are web-based only (no installation needed) and they provide dozens of great onboarding resources to their users, such as blog posts and how-to videos. Nonetheless, companies often provide employee training for the new software tools they provide. In addition, users can benefit from new technologies, such as single-sign-on (SSO), to quickly and safely provide SaaS login to these tools without having to create dozens of different passwords, which is a system that companies such as OneLogin and onetool can offer.
Although these are all good resources for the users, it does not account for the fact that, once a tool is purchased, administrators must add all users to each and every tool. In most companies, this is a task that is still being done manually, one tool at a time. Luckily, software asset management platforms like onetool, can help administrators with this task by allowing them to purchase a tool and either add new users or give access to existing users, all in the same platform.
If a spreadsheet is not the answer, then what is? With the help of technology, SaaS companies, such as Torii, Zylo or Blissfully, have developed an alternative solution: software license management platforms, which help administrators manage the different licenses they have with vendors by giving them a clear overview of all the tools in their ‘toolbox’. With these platforms, the user can easily keep track of all license renewal dates with useful reminders that are important for IT procurement. However, it is the user’s responsibility to follow up with the software vendors to extend or renew the expired licenses, or to assess if it’s time to look for better alternative solutions. In this case, companies are better off using SaaS management platforms that can not only help them manage their software licenses but also facilitate alternative tool options, such as onetool.
Software License Management
Software license management, also referred to as Software Inventory Tracking, or just Software Tracking, is the activity associated with keeping track of all the different software licenses a company has oftentimes provided by dozens of different vendors. Both small and large companies often use a simple spreadsheet to keep track of their software licenses, which requires constant updating either from a manager or a dedicated team. It is easy to see how this, which starts as a simple task, quickly becomes a time-consuming strain on businesses.
If a spreadsheet is not the answer, then what is? With the help of technology, SaaS companies, such as Torii, Zylo or Blissfully, have developed an alternative solution: software license management platforms, which help administrators manage the different licenses they have with vendors by giving them a clear overview of all the tools in their ‘toolbox’. With these platforms, the user can easily keep track of all license renewal dates with useful reminders that are important for IT procurement. However, it is the user’s responsibility to follow up with the software vendors to extend or renew the expired licenses, or to assess if it’s time to look for better alternative solutions. In this case, companies are better off using SaaS management platforms that can not only help them manage their software licenses but also facilitate alternative tool options, such as onetool. Read more on software license management.
Employee Provisioning (Onboarding and Offboarding)
If you have ever been part of a company where the onboarding and offboarding process of a team member is done by an HR team, you have probably dealt with some kind of software that can help with these processes. However, you’ll know that it focuses mostly on administrative tasks, such as gathering personal information, insurance, bank account information for direct salary deposits, and processing time-off requests, or disabling them from the payroll. It simply does not cover the technical aspects needed to make sure an employee’s tech stack is up and running from day one, or disabled the moment they leave the company.
When it comes to onboarding a new employee to all the software used in the company, the process goes something like this: the administrator logs in to tool A, goes to the tool settings page, enters the new employee’s email address, logs out of tool A, administrator logs in to tool B, goes to the tool settings page, enters the new employee’s email address, logs out of tool B, administrator logs in to tool C… and so it goes on. This is why oftentimes new employees do not have access to all their software resources within the first couple of weeks of their employment.
Similarly in the offboarding process, it can take weeks to disable a previous employee, which represents a clear security threat and a significant waste of money on unused subscriptions. According to a study conducted by 1E.com back in 2016 titled “The Real Cost of Unused Software”, companies waste 37% of their software budget in unused tools! Therefore, the SaaS tools that give their users the ability to leave their service as fast as they came to it in the first place are more valuable than ever before. Administrators want to add and remove users as often as they need to without any negative consequences. In this case, the repercussions can be cancellation fees or not being able to terminate a software license at all within a certain time period. SaaS companies, particularly market segment leaders, know that users place great value in being able to leave them easily, if necessary, without a financial loss. More than likely, you have already read somewhere something like “You can cancel your subscription at any time”. Having this option is great, no doubt about that, but what happens when you have to cancel multiple SaaS subscriptions because you have employees leave your company far more often than you would like?
The best way a company can add and remove software users is, again, possible with the help of a unique SaaS Management platform that allows administrators to all new employees to all tools and remove all former employees from all tools by creating (subscribing) and removing (unsubscribing) software licenses. Onetool is a great tool that helps companies improve the employee onboarding and offboarding processes by allowing them to distribute and remove access rights by creating and cancelling licenses with a few clicks in one dashboard.
Software Asset Management Tools
Software Asset Management Tools are designed to facilitate all of or part of the tasks associated with Software Asset Management. There are a lot of different solutions available ranging from simple SaaS review sites all the way to SaaS app stores, procuring services and license managers.
There is a wide variety in SAMT with some basic tools only providing part of the solution to one aspect of SaaS management, other products aim to provide an (almost) complete solution. Read more about software asset management tools.
SaaS Management is important because:
It lets you provide your team members with the tools they need to help them be more efficient
It helps you and your company save money
SaaS Management is easy with the help of a software asset management tool where you can:
Keep track of all your SaaS subscriptions
Give your team quick tool access with single-sign-on
Onboard and offboard team members efficiently
Make sure you’re able to easily cancel your unused subscriptions as needed
SaaS Management is undoubtedly a practice that all companies, big and small, should have under control, but how you accomplish it is very important. Do not waste your time on spreadsheets that are not scalable and focus instead on finding a solution, such as a SaaS management platform like onetool, that will equally save you time and money.
All numbers and statistics reflected in this article are supported by the following: