Know the Basics: 10 Questions About SaaS Management

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From HR management and marketing activities to project collaboration and data analytics - all critical business functions today depend on modern SaaS solutions.

Managing these business-critical apps is a challenge for modern enterprises, as it can’t be done manually. It requires automation and a sophisticated approach called SaaS management.

SaaS management is a discipline that includes everything from managing SaaS apps, and ensuring security and compliance to SaaS cost optimization and user access management.

This blog addresses the fundamentals of SaaS management by answering 10 essential questions. Through these questions, we have tried to provide insights into SaaS management, SaaS spend optimization, license management, and more.

Read on to learn about the basics of SaaS management.

Q1. What is SaaS management?

SaaS management is the process of identifying, tracking, and managing SaaS applications used within an organization. It governs the entire lifecycle of cloud-based applications, from purchase and deployment to renewal and termination.

SaaS management allows IT teams to identify SaaS apps in their application stack, manage SaaS renewals, track license usage, automate provisioning and deprovisioning, optimize cloud expenses, and help combat shadow IT in the organization.

It is a business practice that incorporates all processes required for diligently scaling cloud solutions, upholding privacy standards, ensuring data security, and meeting user needs.

SaaS management is used in organizations to:

1. Manage SaaS contracts & vendors
2. Keep track of SaaS licenses
3. Track & manage SaaS renewals
4. Get visibility into the company's complete SaaS portfolio
5. Purchase & maintain a secure SaaS inventory
6. Enhance IT collaboration in the company
7. Get accurate insights on app usage
8. Eliminate redundancies and save on spend
9. Automate provisioning & deprovisioning.

They provide complete SaaS portfolio visibility through a multitude of discovery methods and can be integrated with:

• Single Sign-On (SSO) systems
• Enterprise Resource Planning (ERP) systems
• Human Resources (HR) systems
• Financial management platforms
• Contract management solutions, and
• Direct integrations with SaaS apps

SaaS management empowers IT, finance, security, & procurement teams & leaders to come together & grow their businesses by making informed decisions.

Q2. Why is SaaS Management Important?

SaaS management is crucial for enterprises that rely on diverse SaaS applications to streamline operations. With the uncontrolled proliferation of SaaS solutions, organizations often juggle multiple applications, making the process complex.

Now, each application has its contracts, user accounts, renewals, and licenses. Effective SaaS management ensures these applications are properly managed, optimized, and secured. This enables organizations to maximize their ROI & mitigate potential risks.

Proper SaaS management helps organizations maintain visibility and control over their SaaS portfolio. This lets them optimize costs by identifying underutilized or redundant subscriptions and negotiating better pricing based on usage data.

It also ensures compliance with relevant regulations and industry standards, minimizing the risk of data breaches and other security incidents. Furthermore, SaaS management streamlines the employee onboarding and offboarding processes.

This ensures that access to critical applications is granted or revoked promptly, reducing the risk of unauthorized access or data leaks.

Additionally, it facilitates the integration and collaboration between different SaaS applications, enhancing productivity and enabling seamless workflows across the organization.

Q3. What is a SaaS management platform?

A SaaS management platform is a centralized solution that helps organizations manage and optimize their growing portfolio of cloud-based software applications.

It provides comprehensive functionalities to streamline SaaS application optimization, procurement, renewal management, user provisioning, de-provisioning, spend management, contract management, and more.

SaaS management solutions have become an integral part of organizations because they help teams:

1. Get visibility into their SaaS portfolio

Lack of visibility into the current state of your SaaS portfolio can lead to wastage of budget, a rise of free apps, unused apps, and apps with overlapping functionalities.

SaaS management platforms, like CloudEagle, provide your IT, finance, and procurement teams with complete visibility into every software your company uses.

2. Reduce Shadow IT

SaaS management platforms help you see all the SaaS solutions your team uses - even the ones certain teams have been using without informing the IT department. This helps cut down on unnecessary costs and keep your SaaS stack secure.

3. Manage & Control Spend

With SaaS management, you can easily control SaaS spending and monitor the usage of every application used by individual teams and departments. If certain solutions are not used often, they can be easily identified. You can then analyze the usage, right-size the licenses, eliminate them, and save on spending.

4. Increase Efficiency of Operations

IT teams can easily provision, deprovision, and monitor user access by centralizing the management of SaaS applications. This reduces administrative overhead and minimizes disruptions caused by manual processes.

5. Ensure Compliance

SaaS Management makes compliance easy by helping you meet the regulations and industry standards surrounding data privacy, security, and SaaS governance.

CloudEagle is one such SaaS management solution that ensures applications adhere to relevant compliance requirements, including industry-specific regulations, data protection laws, and internal policies.

6. Helps Optimize SaaS Spend

SaaS management provides organizations with decision-influencing data into their SaaS app usage and spending patterns.

Using this data, teams can identify underutilized or redundant subscriptions. By consolidating and rationalizing their SaaS portfolio, organizations can reduce unnecessary costs and maximize the value derived from their investments.

Moreover, SaaS management facilitates better pricing and terms negotiations with SaaS vendors by providing accurate usage data.

This data-driven approach enables effective SaaS license management and ensures you don’t overspend or continue investing in underutilized resources.

Q4. How do you manage SaaS applications?

SaaS applications can be managed effectively by following a comprehensive approach encompassing several key aspects. Following are the steps for the same:

• Adopt a centralized SaaS management solution, such as CloudEagle, to gain visibility into your entire SaaS stack
• Implement a robust governance framework for your organization. It must clearly define SaaS procurement and usage policies, processes, and approval workflows
• Keep track of licenses and analyze SaaS usage data to spot redundant or underutilized applications and optimize costs
• Enforce strict user provisioning and access controls processes to ensure secure and appropriate access to SaaS applications
• Assess and manage risks related to security, compliance, and data privacy across your SaaS ecosystem
• Regular audits should be conducted to analyze usage and identify redundancies. Based on the analysis, eliminate unused apps or consolidate apps to save on spend.

By implementing these best practices, organizations can effectively manage their SaaS applications, maximize value from their investments, and maintain a secure and compliant SaaS environment.

Q5. How can we identify unused, duplicate, and redundant SaaS applications?

Identifying unused, duplicate, and redundant SaaS applications is crucial to effective SaaS management. Here are some strategies that can help organizations uncover these inefficiencies:

1. SaaS Visibility

The first step is to get complete visibility of your SaaS stack and maintain an up-to-date inventory of SaaS applications, including details such as app owner, spend and usage insights, renewal dates, and associated resources.

By implementing a SaaS management platform like CloudEagle, you can automatically discover and catalog all the SaaS tools and applications used across the organization.

CloudEagle has 300+ integrations that can connect with your internal systems and applications through custom APIs, enabling you to identify all applications used within your organization.

2. Usage Monitoring and Analytics

The usage monitoring capabilities of SaaS management platforms let you track the actual usage patterns of SaaS applications. These tools help you analyze user activity logs, login data, and other usage metrics to identify applications with no or low usage over a specific period.

3. Analyze redundancies

Review the capabilities of the SaaS applications in your portfolio with SaaS management platforms. The platform helps identify applications that overlap in functionality or provide similar features. Once the apps are identified, leaders can consult with department heads to understand each application's specific use cases and requirements.

4. License Management

Regularly reviewing the number of licensed users against the actual active users for each SaaS application is crucial. Identifying where the organization is paying for more licenses or unused licenses is also important, as it indicates the potential for cost savings.

5. Employee Feedback and Surveys

Another way could be to gather employee feedback regarding their SaaS applications and their satisfaction levels with the product. Any identified redundancies or overlaps should be recorded.

Q6. How do you optimize SaaS spend

Optimizing SaaS spend is a crucial aspect of effective SaaS management. Here are some strategies to help organizations optimize their SaaS spend:

1. Conduct SaaS Audit - Identify unused or underutilized subscriptions for elimination.

2. Strategic Contract Negotiation - Get expert negotiation assistance and leverage price benchmarks to secure the best deals with flexible terms.

3. Vendor Relationship Management - Streamline vendor relationships for better negotiation leverage.

4. SaaS Cost Management - When you have complete visibility into your SaaS expenses & app usage, you can make data-driven decisions to optimize costs.

5. Application rationalization: identify redundant applications, analyze usage, and optimize them to save on spend.

6. Vendor consolidation: Consolidate overlapping applications using comprehensive solutions to minimize costs.

Q7. What is License Reclamation in SaaS Management?

In SaaS management, license reclamation refers to the process of identifying and reclaiming unused or underutilized software licenses. The process involves analyzing usage data and license assignments to determine if a company is paying for more licenses than it needs.

Organizations can reduce their overall SaaS costs and optimize spending by reclaiming these excess licenses. License reclamation typically involves revoking access and deactivating licenses for inactive users.

It also entails reassigning licenses to active users who require them, and downgrading or canceling subscriptions for applications with low usage.

Q8. What are the common challenges in SaaS management?

Managing a growing SaaS applications portfolio comes with several challenges.

Here are some common challenges in SaaS management:

1. SaaS Sprawl

As the number of SaaS applications increases, it becomes difficult to maintain visibility and control over the entire SaaS portfolio. This phenomenon is known as SaaS sprawl.

2. Lack of Centralized Governance

Without a centralized governance framework, organizations struggle to enforce consistent policies, processes, and best practices for SaaS procurement, SaaS spend management, and application management.

3. Shadow IT

Employees may use unauthorized or unsanctioned SaaS applications, introducing security risks and compliance issues.

4. Data Silos and Integration Challenges

SaaS applications often create data silos, making it difficult to integrate and share data across various systems and applications.

5. Hassles in License Management

Tracking and optimizing software licenses across multiple SaaS applications can be complex. This may lead to potential overspending or result in poor ROI due to under-utilization.

6. Cost Control and Budgeting

Managing multiple SaaS subscriptions and varying pricing models makes it challenging to forecast and control SaaS-related costs accurately. Without centralized visibility and usage insights, budgeting also gets complicated.

7. Security and Compliance Risks

A significant challenge is ensuring that SaaS applications adhere to security standards, data privacy regulations, and industry-specific compliance requirements.

Q9. How to identify and eliminate shadow IT

Shadow IT refers to using unsanctioned or unauthorized software, applications, or services within an organization.

Shadow IT in an organization poses many risks - From security breaches to non-compliance with industry regulations.

Therefore, identifying and eliminating shadow IT is crucial for maintaining security, compliance, and control over the IT environment. Also, it will prevent you from incurring expenses.

Here are some strategies to tackle shadow IT:

1. Conduct Regular Audits

Perform periodic audits in your IT environment to identify rogue applications, unauthorized data transfers, and potential security vulnerabilities associated with shadow IT.

2. Establish a SaaS Discovery Process

Equip your team with the right SaaS discovery tools to automatically discover and catalog all the SaaS applications being used across the organization, including those that may be unauthorized and duplicate apps.

3. Encourage Employee Awareness

Educate employees about the risks of shadow IT. Educate them about the importance of following approved procurement and usage policies.

4. Uncomplicate Procurement

Simplify the procurement process for employees to request and provide training to your employees on how to purchase apps they need the right way. This will reduce the temptation to use unauthorized alternatives.

5. Inform About Sanctioned Alternatives

Provide employees with approved and secure alternatives to popular shadow IT applications, addressing their use cases and specific needs.

By implementing these measures, organizations can gain visibility into shadow IT, mitigate associated risks, and foster a more secure and compliant IT environment.

Q10. What are the consequences of poor SaaS management?

Poor SaaS management can impact an organization’s operations, security, compliance, and financial performance.

Here are some of the major consequences of inadequate SaaS management:

1. Increased Costs

Failure to track and optimize applications may result in unnecessary spending on unused or underutilized software, inefficient license utilization, and suboptimal contract negotiations, impacting the organization's budget.

2. Security Risks

Inadequate security measures, such as weak user access controls and delayed updates, pose significant risks. SaaS applications managed poorly may become vulnerable to cyber threats, potentially exposing sensitive data and compromising the organization's overall security posture.

3. Data Loss and SaaS Compliance Issues

Inadequate backup strategies, non-compliance, and a lack of encryption can contribute to legal and regulatory challenges, affecting the organization's adherence to industry standards.

4. Reputation Damage

Security breaches, data leaks, or operational disruptions result in negative perceptions among customers, partners, and stakeholders. This also heavily impacts trust and credibility in the market.

5. Vendor Lock-In

Poorly managed relationships with SaaS vendors can result in dependency issues, making switching to alternative solutions or negotiating favorable terms challenging. This lack of flexibility can limit the organization's ability to adapt to changing business needs and streamline SaaS vendor management.

6. Poor scalability

The inability to scale SaaS usage to meet growing business requirements can hinder organizational growth and agility. Poorly managed SaaS solutions may struggle to adapt to increased demands, limiting the organization's ability to expand seamlessly.

7. Lack of Visibility and Control

Inadequate monitoring and reporting tools can result in a lack of visibility into SaaS usage patterns. This makes it challenging for organizations to track expenses, identify potential issues, and make informed decisions about their SaaS portfolio.

Conclusion

SaaS solutions power modern businesses, making SaaS management a critical skill. This blog aims to empower you with essential knowledge about SaaS management, shadow IT, cost optimization, the impact of poor SaaS management, and more when managing SaaS solutions.

Mastering these basics enables you to maximize value from your SaaS investments. You can apply your knowledge to optimize your SaaS portfolio, enhance efficiency, and reduce organizational costs.

A SaaS management solution is essential to managing your SaaS applications, and CloudEagle is one of the most comprehensive platforms on the market. It offers features like:

• Application discovery
• Contract management
• License management
• Workflows for procurement, renewals, license reclamation, and user provisioning
• Vendor research module
• Cost optimization module
• Assisted buying
• Price benchmarks
• Onboarding and offboarding

Here’s why IT teams are choosing CloudEagle to manage their SaaS applications. So, what are you waiting for? Book a demo and see how our SaaS management platform can help you manage your SaaS and optimize spending.

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