Implementing SaaS Governance Frameworks: Vital Points to Note

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The widespread adoption of SaaS applications has completely transformed how organizations function. SaaS has become hugely popular with its easy setup, automatic updates, and pay-as-you-go model. These applications are flexible, scalable, and easily accessible, streamlining operations and enhancing productivity.

However, this rapid adoption also brings challenges like uncontrolled costs, potential security risks, and the rise of shadow IT. Organizations that maintain a large SaaS stack need strong governance frameworks.

A SaaS governance framework helps organizations establish policies, security measures, compliance requirements, cost management strategies, and integration protocols. It maximizes productivity and value from SaaS investments while aligning with company goals and regulations.

Managing SaaS apps and identifying cost-saving opportunities can be challenging without a SaaS governance framework. This will also impact employee productivity.

Continue reading this comprehensive guide to learn how to establish a strong SaaS governance framework to manage and optimize your SaaS ecosystem effectively.

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Key considerations for implementing a SaaS governance framework

To implement a SaaS governance framework, you need careful planning and consideration, like:

1. Defining your governance goals

The first and foremost thing when building a SaaS governance framework is to define your goals. When you clearly define your organization's governance goals, you can concentrate your efforts on implementing strategies and policies that effectively address these objectives. This leads to more efficient and secure management of SaaS applications.

Your organizational goals can include:

Cost optimization: One of the primary goals of your SaaS governance framework should be to optimize SaaS costs. This involves identifying cost-saving opportunities, such as eliminating redundant applications, optimizing license usage, and negotiating favorable pricing with vendors.

Check out this table to understand the different cost-saving opportunities associated with SaaS.

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Security and compliance: Security and compliance are two major aspects of creating a SaaS governance framework. The objective of enabling different SaaS security measures is to safeguard sensitive information from unauthorized access, data breaches, and cyber threats.

The data stored in those apps, such as financial records, client data, and intellectual property, holds immense value and requires protection to avoid financial losses and reputational harm.

By recognizing these risks and implementing appropriate security measures, companies can effectively mitigate threats and ensure the security of their data.

Your SaaS governance framework should also include measures such as data encryption, access controls, regular security audits, and compliance with relevant regulations like GDPR, CCPA, HIPAA, FERPA, PCI DSS, IFRS, GAAP, ASC 606, SOC 2, and ISO 27001.

These standards address various aspects of data protection, financial reporting, and security protocols essential for trust, credibility, and legal compliance.

Improved user experience: Enhancing the user experience with SaaS apps should be a key governance objective. This involves ensuring that applications are user-friendly, reliable, and accessible and that users receive adequate support and training to maximize productivity.

Streamlined procurement and provisioning: Simplifying the SaaS procurement and provisioning processes can help reduce administrative overhead and ensure users have timely access to the necessary tools. This may involve implementing self-service portals, standardizing procurement workflows, and automating provisioning workflows.

With well-defined procurement workflows, you can efficiently acquire and manage SaaS tools. These workflows encompass the entire procurement lifecycle, from identifying the need for a new SaaS solution to evaluating vendors, negotiating contracts, and ultimately purchasing.

These clear and standardized procurement workflows ensure transparency, accountability, and compliance, leading to better purchasing decisions and optimized resource allocation.

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Also, using Slack workflow, you can enhance the effectiveness of the SaaS procurement processes by automating communication and collaboration tasks.

Automation in SaaS procurement, Slack workflows, and auto-provisioning saves time and resources. It eliminates manual tasks, freeing IT teams for strategic work. It also reduces errors and ensures compliance, enabling organizations to maximize their SaaS investments and innovate.

2. Inventory & assessment: Knowing what you have

You should conduct a comprehensive inventory assessment to manage your SaaS environment effectively. This assessment will help you gain better visibility into your SaaS stack and make informed decisions to optimize usage, reduce costs, and mitigate security risks.

This assessment includes:

Identifying all existing SaaS applications: Begin by compiling a list of all available SaaS apps across your organization. To identify all existing SaaS applications within your organization, compile a comprehensive list of all available apps.

It can be challenging to gain complete visibility into all SaaS applications manually. In such cases, utilizing a SaaS management platform is beneficial. These platforms integrate with internal systems like SSOs and HRIS, offering visibility across the organization's software stack.

The tool categorizes duplicates, unused, sanctioned, and unsanctioned apps and displays them on a single dashboard. This centralization allows organizations to optimize based on usage data, streamlining SaaS usage, cutting costs, and ensuring policy and regulatory compliance.

Analyzing usage patterns and identifying underutilized licenses: Once you have the inventory, analyze usage patterns for each application. This entails understanding how frequently each application is used, by whom, and for what purposes. Identify any underutilized licenses or instances where multiple licenses are purchased but not fully utilized.

An SMP can help you identify all the SaaS licenses in the tech stack and categorize them as used or underutilized licenses. Some SMPs like CloudEagle also provide advanced license harvesting workflows, allowing you to retrieve unused and underused licenses and harvest them for later use.

Assessing security risks associated with each application: Evaluate the security posture of each SaaS application. This assessment should include factors such as data encryption, access controls, authentication mechanisms, compliance with regulatory requirements (e.g., GDPR, SOC2), and any known security vulnerabilities or incidents associated with the application.

• GDPR: The EU's privacy law protects personal data, and organizations must handle data carefully or face fines.
• CCPA: California's privacy law gives consumers control over their data and obliges businesses to disclose practices to avoid penalties.

One significant risk to consider is the potential for unauthorized access and data theft by ex-employees who still retain access to SaaS applications. Improper deprovisioning of access rights can create vulnerabilities that malicious actors may exploit when employees leave the organization.

Check this table to understand the security risks associated with each SaaS app.

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Utilizing tools like CloudEagle can streamline the deprovisioning process by automating access management tasks to avoid such situations. It ensures swift revocation of access rights when an employee departs, minimizing the risk of ex-employees exploiting their access for unauthorized purposes.

Moreover, you should evaluate the compliance status of SaaS vendors concerning regulatory standards such as GDPR and SOC 2. Even if a vendor isn't compliant, their non-compliance could adversely affect your business, leading to legal and financial consequences.

By entering into “Service Level Agreements” (SLAs) with vendors, you can mitigate these risks by holding them accountable for any data breaches or penalties resulting from non-compliance.

3. Policy development: Establishing ground rules

Developing clear and comprehensive policies is essential for effectively governing your SaaS environment. They provide clarity and consistency and promote responsible usage while mitigating security and compliance risks.

To establish such policies for creating a SaaS governance framework, you should:

Implement access controls and user provisioning policies: Define who has access to which SaaS apps and under what circumstances. Implement role-based access controls (RBAC) to ensure users have appropriate permissions based on their organizational roles and responsibilities.

Check this table to understand the step-by-step process to establish RBAC procedures for provisioning and deprovisioning user accounts, ensuring timely access management.

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Establish approval workflows for new SaaS purchases: Create standardized policies and procedures for requesting and approving new SaaS subscriptions. Specify who is authorized to initiate purchase requests. A clear policy avoids random purchases and the risks of shadow IT. Plus, it speeds things up and keeps everyone in the loop, reducing frustration.

A centralized system helps track SaaS spending and ensures purchases align with the organization's goals and security standards. It also makes deciding who can request purchases easier, eliminating confusion.

By keeping everyone informed about the progress of their requests, trust in the process grows, and decisions are made faster. Regarding security, the approval process should also check if new subscriptions meet data protection standards and don't pose any risks.

Create data security and privacy guidelines for SaaS usage: Develop clear guidelines for protecting sensitive data and maintaining privacy when using SaaS applications. Specify encryption requirements, access controls, and data handling procedures to minimize the risk of data breaches.

4. Technology & automation: Making use of automated platforms

To build a SaaS governance framework, you should emphasize using automation tools. These advanced tools improve efficiency, ensuring effective SaaS management of your organization while maintaining compliance with policies and regulations.

To establish such an efficient SaaS environment, you should:

Integrate SaaS management platforms (SMPs) for centralized control: Utilize a SaaS management platform (SMP) to centralize control and visibility over your applications. These platforms allow you to consolidate information about all your SaaS subscriptions, users, and usage data in one place.

For instance, you can use CloudEagle, an advanced SaaS management and procurement platform. The tool streamlines and centralizes your organization's SaaS management with different features and automated workflows.

With CloudEagle, you can oversee all your SaaS applications via a single dashboard. You can comprehensively view your SaaS environment, covering usage, spending, user access, and security.

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CloudEagle provides continuous real-time monitoring of cloud expenses, enabling proactive cost management. You can avoid potential cost overruns by identifying areas for optimization without disrupting operations.

With detailed department spending breakdowns and precise analysis of user activity, CloudEagle helps you pinpoint SaaS overutilization or underutilization. The tool identifies and consolidates unused, duplicate, or free apps, optimizing your SaaS expenditure effectively.

Automate tasks like provisioning and deprovisioning: With CloudEagle's auto-provisioning workflows, you can streamline user provisioning and reduce manual efforts for your IT team.

This tool eliminates the time-consuming task of visiting each application to grant or revoke access to apps, potentially saving over 500 hours annually.

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Check this testimonial from Alice Park from Remediant, who used to spend a lot of time manually provisioning and deprovisioning users across various applications. However, integrating with CloudEagle's HRIS system centralized user management, saving Alice valuable time.

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Automated license renewals: To manage all your organization's licenses efficiently, CloudEagle’s direct integrations allow you to view purchased licenses for each application and track their usage.

Instances of underutilization can affect your ROI, but CloudEagle offers license reclamation workflows to deprovision users with low usage and reclaim those licenses.

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With CloudEagle's license harvesting workflows, you can ensure that purchased licenses are optimized and utilized effectively.

Leverage analytics dashboards for monitoring and reporting:

Use analytics dashboards to track SaaS usage, costs, and security. These provide real-time insights for optimizing usage and making data-driven decisions. Moreover, leverage reporting functionalities to produce tailored reports for stakeholders, auditors, and compliance needs.

For example, with CloudEagle, you can access intuitive dashboards and generate diverse reports covering 44 parameters in 8 categories, including SaaS spend visibility, renewal management, budgeting, app visibility, spend optimization, etc.

5. Roles & responsibilities: Collaboration makes better governance

Effective SaaS governance requires clear ownership and involves key stakeholders. This fosters collaboration, accountability, and alignment across departments, leading to better outcomes for the organization.

To establish roles and responsibilities within the organization for creating a SaaS governance framework, you should:

Assign clear ownership for SaaS governance processes: Designate individuals or teams responsible for overseeing and implementing SaaS governance processes within your organization.

This includes defining roles such as SaaS administrators, security officers, and compliance managers who are accountable for different aspects of SaaS management and governance.

Identify key stakeholders involved: Identify and involve key stakeholders from various departments. Each stakeholder brings unique insights and requirements to the table, ensuring that governance decisions are well-informed and aligned with organizational goals.

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If you want to learn how to optimize Shadow IT in your organization and increase ROI, listen to Joshua Peskay, a 3CPO (CIO, CISO, and CPO) at RoundTable Technology. He discusses managing Shadow IT from remote work and introduces an ROI score for SaaS tools to help businesses optimize their technology investments.

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Benefits of implementing a SaaS governance framework

By implementing a SaaS governance framework, you can:

Reduced costs: By centralizing the procurement process, you can avoid duplicate purchases and ensure that SaaS applications are acquired at the best price.

Also, regular audits and license usage tracking help identify underutilized licenses. It allows for optimizing SaaS costs or terminating unnecessary subscriptions, reducing costs.

Enhanced security: With security protocols and access controls, you can protect sensitive data and mitigate the risk of breaches and non-compliance penalties. SaaS governance provides a comprehensive overview of applications, reducing risks like session hijacking and phishing through employee training and data destination insights.

Increased productivity: Automating tasks such as user management reduces the burden on IT staff, freeing up their time and resources to focus on more strategic initiatives. Clear access policies ensure that employees have easy and efficient access to the tools and resources they need to perform their tasks effectively.

By freeing up valuable time and resources previously spent on manual tasks, IT professionals can redirect their efforts toward strategic initiatives that drive innovation and growth.

With streamlined access procedures, employees can swiftly access the software applications and data they need, minimizing downtime and optimizing workflow processes.

Improved visibility: Real-time monitoring provides organizations with valuable insights into how SaaS applications are used across the organization.

By analyzing usage patterns, organizations can better forecast future needs and allocate resources more effectively, ensuring that they are investing in the right tools and scaling them appropriately.

Alignment with business needs: Collaboration between IT and business ensures that the selection and deployment of SaaS applications align closely with the organization's goals and requirements.

This alignment helps avoid situations where tools are chosen based solely on technical considerations without considering how they contribute to overall business objectives.

Empowerment of employees: Educating employees about available tools and proper usage empowers them to decide which tools best suit their needs.

Monitoring and managing applications help prevent the proliferation of Shadow IT, ensuring that employees have access to approved and supported tools while maintaining security and compliance standards.

Strengthened fiscal responsibility: Clear ownership and collaboration systems help organizations better manage their SaaS spending by reducing costs associated with Shadow IT and redundant applications. Organizations can drive greater efficiency and innovation by reinvesting these savings into critical business areas.

Data-driven decision making: Insights into SaaS application usage and performance enable organizations to decide which tools to invest in and how to optimize their processes. By aligning software utilization with business goals, organizations can maximize the value they derive from their SaaS investments and ensure that resources are allocated effectively.

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Conclusion

A SaaS governance framework is essential for effective management, risk mitigation, and resource optimization. Clear policies, technology utilization, stakeholder involvement, and risk assessment are key for benefits like cost reduction, heightened security, increased productivity, and better visibility.

Start by inventorying SaaS apps, analyzing usage, and identifying and mitigating potential risks. Set governance goals, establish usage, access, and compliance policies, and employ SMPs and automation. These steps pave the way for a robust SaaS governance framework, enhancing efficiency, security, and compliance within the SaaS environment.

If you need assistance selecting the right tool to establish a SaaS governance framework, we recommend CloudEagle—a comprehensive SaaS management and procurement platform with robust security management features.

Schedule a demo with CloudEagle to learn how to implement a SaaS governance framework in your organization.

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