How SaaS Management Outgrows IT Asset Management

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As organizations are embracing digital transformation, the days of tracking software licenses in spreadsheets and managing on-premise installations are rapidly becoming history. The explosive growth of SaaS has transformed how businesses consume, deploy, and manage their stack.

While traditional IT asset management served organizations well in the era of perpetual licenses and physical servers, today's SaaS-first environment demands a more sophisticated management process.

SaaS management brings a more agile, comprehensive approach that is better suited to handle the complexities of multiple SaaS applications and their special licensing models. But how has SaaS management outgrown ITAM? Read on to find out.

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TL;DR

• Traditional IT Asset Management (ITAM) focuses on physical assets and perpetual licenses, while SaaS management handles dynamic subscriptions, usage tracking, and optimization.
• SaaS apps evolve rapidly with frequent updates and flexible pricing models, requiring real-time monitoring and automated optimization beyond ITAM capabilities.
• SaaS management platforms, like CloudEagle.ai, provide full visibility into software usage and unauthorized (shadow IT) apps, helping eliminate redundancy and prevent overspending.
• SaaS management automates contract renewals, sends reminders, and integrates with tools like DocuSign to streamline negotiations and avoid costly auto-renewals.
• Advanced tools offer real-time price benchmarking, assisted buying services, and vendor negotiation insights to maximize ROI and control SaaS costs effectively.

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Differences Between IT Asset Management and SaaS Management

Both ITAM and SaaS management impact how organizations handle their software resources. Understanding how they differ is essential for adapting to the modern digital sector.

Tracking and Visibility

The focus of ITAM is primarily on physical assets and perpetual licenses. You track servers, desktops, and installed software on company premises.

In contrast, SaaS management deals with SaaS-based subscriptions. You monitor user accounts, subscription tiers, and usage patterns across different online platforms.

This requires a more dynamic approach, as SaaS apps can be accessed from anywhere, making traditional asset tracking inadequate.

Ownership vs. Subscription

In ITAM, you typically own the software outright after purchasing licenses. This ownership model often involves significant upfront costs but gives you long-term control over the asset.

SaaS management revolves around subscription-based services. You pay recurring fees for access to software hosted on remote servers. With this model, you have flexibility, but it requires ongoing management to ensure you're not overpaying for unused services.

Renewal and Optimization

ITAM involves periodic license renewals and maintenance of owned software. You focus on keeping software up-to-date and ensuring compliance with license terms.

SaaS management, however, demands continuous optimization. You must regularly review usage data, adjust subscription levels, and negotiate with vendors to maximize value. This ongoing process helps prevent unnecessary costs from idle or underutilized accounts.

Cost Control

ITAM typically involves budgeting for large, infrequent purchases and ongoing maintenance costs. You might allocate funds for major software upgrades every few years.

SaaS management, on the other hand, requires constant vigilance. You need to monitor monthly or annual subscription costs, track usage patterns, and quickly identify potential cost savings.

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Why SaaS Management Outgrows IT Asset Management

1. SaaS Proliferation

Uncontrolled SaaS proliferation is rapid due to the widespread adoption of SaaS-based apps across organizations. This phenomenon has outpaced what traditional ITAM is capable of.

According to a study, 70% of apps used in organizations is SaaS and come 2025, it'll increase to 85%. So, right now, your company likely uses dozens, if not hundreds, of these applications.

SaaS apps have become integral to daily operations, from project management tools like Asana to communication platforms like Slack.

Unlike traditional software, individual departments or employees can easily acquire SaaS applications without IT oversight.

This decentralized adoption creates a complex web of applications that traditional ITAM tools struggle to track.

This is one of the reasons why SaaS management has outgrown ITAM since the best SaaS management platforms easily handle these, giving you specialized tools and processes to take care of this proliferation effectively.

2. Complexity of SaaS Licensing

SaaS licensing brings new challenges that traditional ITAM tools simply cannot adequately address.

Each SaaS application often comes with its own subscription model, terms of service, and usage metrics.

For example, one app might charge per user, while another bases its pricing on data storage or API calls. This complexity multiplies when you consider enterprise-wide usage.

SaaS licenses also frequently include tiered pricing, seasonal promotions, or custom enterprise agreements. These variables create a dynamic environment where costs can fluctuate month to month.

Traditional ITAM tools, designed for straightforward perpetual licenses, lack the flexibility to manage these intricate licensing structures. They fail to address the critical need for license harvesting. Without proper license harvesting capabilities, you risk paying for licenses that sit idle or maintain higher-tier subscriptions for users who only need basic features.

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SaaS management tools can automatically reclaim licenses based on usage thresholds, downgrade underutilized premium subscriptions, and adjust license allocations during employee offboarding.

3. Lack of Visibility in Traditional ITAM

Due to their limited integration capabilities, traditional ITAM tools fall short of providing comprehensive visibility into SaaS usage and spending.

As a result, you might have limited insight into which SaaS apps are being used, by whom, and how frequently.

This lack of visibility can lead to several issues. Firstly, you might be unaware of redundant apps serving similar functions across different departments.

Secondly, you could be paying for unused or underutilized licenses. For instance, your company might have 100 Zoom licenses, but only 60 employees actively use the platform. Traditional ITAM tools would struggle to identify this inefficiency.

SaaS management solutions, however, provide complete visibility through integrations with platforms like Workday. These integrations enable you to track basic usage metrics and even feature-level utilization.

For example, you can identify which Zoom users actually host meetings versus those who only join them, or which Salesforce users leverage advanced features that justify their premium licenses.

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These tools provide centralized visibility across your entire SaaS stack, allowing your IT team to quickly spot unsanctioned apps, eliminate duplicate subscriptions, and identify free trials before they convert to paid plans.

Through direct API connections with your SaaS applications, you gain real-time insights into usage patterns, ensuring 100% visibility into your software investments and enabling data-driven optimization decisions.

4. Dynamic SaaS Ecosystem

The SaaS ecosystem is characterized by its rapid evolution and frequent updates. Unlike traditional software that might see major releases annually, SaaS apps often update weekly or even daily.

These updates can include new features, change user interfaces, or modify pricing structures. Additionally, SaaS apps frequently integrate with one another to create a complex network of interconnected tools.

Traditional ITAM processes are designed for a more static software stack. They struggle to keep pace with this dynamism. A critical update to your CRM software, for instance, might affect its integration with your marketing automation tool.

SaaS management solutions are built to handle this fluidity, offering real-time monitoring of changes and potential impacts on your software stack.

With this agility, you can quickly adapt to changes to ensure your software stack remains efficient and aligned with your business needs.

5. Real-time Monitoring and Management

Perhaps the most significant advantage of SaaS management over traditional ITAM is its ability to provide real-time insights.

SaaS management tools continuously monitor application usage, user activity, and license compliance. This real-time data empowers you to make informed decisions quickly.

A SaaS management platform will alert you immediately if an employee's account shows unusual activity, potentially indicating a security breach.

It can also provide instant notifications when license limits are approaching, allowing you to proactively adjust subscriptions. This level of immediacy is crucial in today's fast-paced business sector.

Real-time management enables continuous optimization of SaaS investments. You can promptly identify underutilized applications or features and swiftly reallocate resources.

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Key SaaS Management Capabilities That ITAM Lacks

SaaS management has many capabilities that ITAM lacks. These capabilities significantly enhance an organization's ability to manage its software stack.

1. Automated Discovery of Shadow IT

Unlike traditional ITAM tools, CloudEagle.ai excel at detecting unmanaged and unauthorized applications within your organization.

CloudEagle.ai can identify every app in your SaaS stack within 30 minutes, providing complete visibility into your portfolio. It rationalizes your SaaS stack by identifying and eliminating redundant apps based on usage data.

The platform configures alerts to detect unsanctioned apps purchased with company credit cards, catching shadow IT in its early stages. It also categorizes apps by department to enable easy differentiation and effective cost tracking.

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The employee self-service app catalog is another crucial feature that allows staff to request access to approved apps via Slack or MS Teams, reducing the temptation to use unauthorized software.

This process is streamlined with quick approvals on Slack, minimizing the IT team workload and making employees productive from day one.

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CloudEagle.ai augments existing helpdesks, integrating with ServiceNow or JIRA to maintain comprehensive request records. It offers time-based access for privileged systems and temporary workers, enhancing security and cost control.

With this level of visibility into existing apps, this tool nudges employees away from unnecessary new purchases, effectively curbing shadow IT proliferation.

2. Contract and Renewal Management

Another reason why CloudEagle.ai outgrows IT platforms is that it lifts contract and renewal management to the next level, surpassing traditional ITAM systems.

These platforms centralize all vendor contracts in a secure dashboard, eliminating the need for cumbersome spreadsheets.

They automatically extract critical metadata, including renewal dates and minimum spend commitments, giving you a clear overview of your obligations.

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CloudEagle.ai manages renewals by initiating workflows up to 90 days in advance. You receive timely reminders via Slack and email to ensure you're never caught off guard by auto-renewals.

The platform also easily integrates with existing contract repositories like DocuSign and Ironclad, consolidating your contract data.

CloudEagle.ai empowers you to make informed decisions by providing renewal cards with key data points. This feature enables smarter negotiations with vendors.

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Additionally, the platform's app directory helps you easily find alternative options if you decide to switch vendors, potentially leading to significant cost savings.

3. Usage Analytics and Optimization

CloudEagle.ai provides usage analytics and optimization features that traditional ITAM tools lack.

The platform centralizes all license management in a single, powerful dashboard, providing real-time visibility into purchased, provisioned, and actively used licenses.

Through direct integrations, the platform monitors login patterns and feature-level usage, enabling you to optimize license allocation for each user. This insight helps you make informed decisions about license types and spending.

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CloudEagle.ai's AI-driven contract metadata extraction automatically organizes all purchased and provisioned licenses, eliminating the need for spreadsheets. Even for apps without direct integration, you can easily upload license files, and the AI system automatically processes and organizes the data.

CloudEagle.ai also provides sophisticated utilization tracking and management. The platform sends alerts based on usage patterns to help you determine when to upgrade or downgrade licenses.

Here's how RingCentral saved millions by harvesting unused licenses using CloudEagle.ai, check out this interesting success story.

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Additionally, it enables app administrators to conduct thorough license audits and deprovision users directly from the dashboard, streamlining the entire management process.

4. Price Benchmarking, Procurement workflows, and Vendor Negotiation

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With CloudEagle.ai, you get real-time, unbiased pricing benchmarks compiled from over 1 billion transactions. You gain instant access to this data through an AI-powered database, eliminating the need for time-consuming peer consultations.

CloudEagle.ai's SaaS Map, a comprehensive database of 150,000+ vendors, updates weekly with the latest pricing intelligence.

This tool allows you to easily compare your spending against industry benchmarks based on your company size, license count, and contract terms.

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The platform provides detailed buying guides, offering insights into negotiation strategies gleaned from real buyers' experiences. This feature ensures you enter negotiations well-prepared and confident.

CloudEagle.ai also offers assisted buying services, handling vendor research and negotiations on your behalf. This service saves you significant time and resources, allowing your procurement team to focus on strategic vendors and critical initiatives.

The platform helps you secure the best possible deals for your SaaS investments by leveraging up-to-date usage data and benchmarks.

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Conclusion

SaaS management has decisively outgrown IT asset management due to its superior capabilities in handling the complexities of SaaS-based software ecosystems.

It offers automated discovery of shadow IT, robust contract management, detailed usage analytics, and powerful negotiation tools. These features enable you to optimize your SaaS stack, reduce costs, and enhance security.

You must adapt your management strategies to leverage these advanced tools to stay competitive in today's digital sector.

Take the first step towards efficient SaaS management by booking a demo with CloudEagle.ai today. Experience firsthand how our platform can transform your software management, streamline operations, and drive significant cost savings for your organization.

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Frequently Asked Questions

1. What is asset management in SaaS?

Asset management in SaaS involves tracking, managing, and optimizing software applications and their usage to ensure efficient operations and compliance with licensing agreements.

2. How does an IT manager manage SaaS applications?

An IT manager manages SaaS applications by monitoring usage, ensuring security, controlling costs, maintaining compliance, and collaborating with finance and procurement teams for effective resource allocation.

3. What is the SaaS management strategy?

A SaaS management strategy outlines processes for selecting, implementing, monitoring, and optimizing SaaS applications with a focus on cost control, user satisfaction, security, and overall business objectives.

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