What is SaaS Management?
What is it, why does it matter, and what's next?
What is SaaS Management? SaaS Management is the act of managing and tracking all the cloud applications used within an organization. Typical uses of a SaaS Management system include; improving onboarding and offboarding, monitoring SaaS Spend, discovering which tools are used by employees, and automating complex or mundane tasks.
Importantly, the above definition doesn’t tell the whole story. That's because SaaS Management isn't just a piece of software with a bundle of features. Instead, it’s a unique way to think about all of your software!
In this article, we'll go beyond a simple definition and try to understand:
- How We Got Here? (The SaaS Explosion)
- How We Make Purchase Decisions Now (Decentralization)
- Why We Need SaaS Management
- What Does SaaS Management Do?
- Three Examples of SaaS Management in Action
- Conclusion: What Should You Do Now?
Note💡 Already a SaaS Management Master? Check out our useful article about the emergence of Automated SaaS Management - a new and evolving subset of SaaS Management that prioritizes automation capabilities.
Before we can address those points, I want to step back and address how we got to this point.
How We Got Here - The SaaS Explosion
Do you remember purchasing software as a disc? Neither do I. The only reason I know it ever happened is a blue cardboard box in my electronic junk drawer for Adobe Photoshop CS5.
This tells me two things.
First, I should definitely organize that junk drawer.
Second, our buying behavior with software has changed significantly in the last decade.
Buying software used to be an event. We would wait for big announcements about software in the same way we still do for hardware. Announcements, pre-sales, and expensive up-front costs were all the norm.
But now, it's different.
- We don't buy a disc; we buy a subscription.
- We don't wait for the next release because the software continuously updates in the background.
- We don't listen to announcements because iterations are outlined on release notes.
We don't buy software; we buy access to software. We buy software as a service (SaaS).
This slow but all-consuming change in software delivery meant it was easier than ever for new software to appear and for users to try and buy it.
With barriers lowered, we made more software, bought more software, and soon had the SaaS explosion. A new tool for every task.
While this expansion of opportunity is exciting - it also changes how companies choose software.
How We Make Purchase Decisions Now (Decentralization)
Thanks to the explosion of tools, we now have... a lot of tools. Many of these tools are specific to department roles and goals. So precise and so numerous that our IT teams cannot select every tool used by each department.
But business hasn't slowed down. Just because the IT team can’t pick every tool doesn’t mean sales or marketing can lower their KPI goals. Instead, these decisions are increasingly made by Line of Business leaders.
The decision-making is becoming decentralized.
Why Do We Need SaaS Management?
We've addressed the SaaS explosion and the decentralization of decision-making. But, you might be wondering why this shift requires a new practice and tool.
We need SaaS Management because with this increase in decentralization comes an increase in other things.
🔓 Security Risk
🏕 Siloing (of knowledge, resources, and talent)
However, despite these negatives, we cannot go back to centralized decision-making for every tool; this stifles innovation and growth.
Instead, we need SaaS Management to continue optimizing and growing while also preventing risk, cost, waste, and silos.
IT's role in the company is different, but it has never been more critical. With the power of a SaaS Management tool, IT can unify and coordinate the company’s growth while also reducing exposure to risk and waste.
What Does SaaS Management Do?
SaaS Management is a new category and is still evolving. However, there are still a handful of things that SaaS Management must do in order to be effective.
- Discover app usage for both sanctionand and unsanctioned applications within your organization
- Centralize that data and provide actionable next steps
- Automate the processes that are difficult or mundane
Those all sound well and good, but let's also look at some real-life-examples of SaaS Management in action.
Three Critical Examples of SaaS Management in Action
Combat Shadow IT 🔦
What is Shadow IT? Shadow IT is all applications used outside the view of the IT department. Since our purchasing became decentralized, this number has ballooned without IT knowing its extent. In most organizations, IT managers underestimate the number of applications by three to six times the actual number. That means that for every single application an IT manager knows about, there are two to five more that they don't.
How does SaaS Management help? SaaS Management includes discovery tools that show the IT department which applications the employees use - including Shadow IT apps. There are different ways to discover the apps used, and not all of them are equal (For example, Torii's discovery tool finds two to three times more shadow IT apps than our leading competitors).
What can you do with this information? Shadow IT carries absolute risk, but it can also result from your team trying out new tools. With discovery, you can identify possible threats before they break out. You can also learn which applications your teams actually use.
Learn how discovery with Torii shines a light on Shadow IT through a simple browser extension and finds two to three times more apps than leading SaaS Management Systems.
Automate Onboarding and Offboarding Processes
Why Onboarding and Offboarding Matters: Every month, millions of workers decide to leave their current job and try something new. A Poor onboarding process can result in lower productivity and employee retention. Likewise, poor offboarding can result in wasted time, money, and a significant security threat when an employee leaves. (read more here)
How does SaaS Management help? In an increasingly SaaS-centric environment, the software is the new workplace. SaaS Management helps you better manage your licenses and offer employees easy access to your app portfolio where they can see which apps are approved and quickly select the right tools for their job. Similarly, when an employee leaves a company, their access privileges can be automatically revoked thanks to SaaS Management. (Note - not all SaaS Management systems automate onboarding and offboarding, but it’s a critical capability)
What can you do with this capability? Create a lasting first impression with new hires by giving them easy access to their needed tools. This increases retention and productivity. Likewise, let IT rest well at night, knowing that one of the most significant security threats now has an automated solution.
Note💡 Offboarding is a big process with many steps. If you want to improve your process (and make sure you eliminate possible security risks) check out our comprehensive offboarding checklist.
Help You Control SaaS Spend and Find Wasted Application Licenses
What are Wasted Application Licenses? Wasted is a broad term. These licenses might be unused seats; they might be duplicate tools purchased by two different departments, they might be similar tools that overlap in capabilities. The point is, waste becomes easy to overlook, but it bloats your expenses and weighs your company down.
How does SaaS Management help? A SaaS Management system like Torii gives you insight into all the tools used (like mentioned above), but it also gives you a view of where your waste is accumulating. Find wasted licenses and wasted seats. Pick out the duplicate or overlapping tools and determine which ones drive your business forward.
What does this do for the bottom line? When appropriately implemented, SaaS Spend Management with a SaaS Management system can dramatically reduce your software expenditures (one of our customers, Rock Content, saved one million dollars immediately just by finding these wasted expenses - read the case study here). However, they also give you insight into which tools are worth the money you spend. In addition, good SaaS Management centralizes your contract information, so you eliminate surprise renewals.
Conclusion: What Should You Do Now?
SaaS Management is an emerging category of tools designed to help us reckon with the changes from the SaaS Explosion. But, each SaaS Management tool is a little different. Moreover, not all tools can do all they should, especially automation and discovery. For that reason, we’re seeing the growth of automation as a critical differentiator among SaaS Management Tools.
Ready to learn more? You're in luck! Check out our latest guide examining Why automation is critical to SaaS Management.