10 best practices for successful IT governance

A modern enterprise without clear IT governance is a recipe for disaster: scattered tech investments, security vulnerabilities, and misaligned business objectives create a perfect storm of inefficiency. 2020’s shift to the cloud left billions of wasted SaaS spend in its wake. Now that budgets are tightening, IT has been tasked with picking up the pieces — without a scalable way to get the visibility needed to govern their SaaS ecosystem. 

Today, the average organization manages over 374 SaaS applications, representing approximately $5,607 in spend per employee annually. The traditional model of centralized IT evaluation, procurement, and management has given way to a new reality where business units, departments, and even individual employees are making independent SaaS decisions. Spreadsheets simply won’t cut it anymore. 

The tension is palpable: IT leaders walk a thin line of implementing robust governance processes without stifling the agility that business units need to stay competitive. CFOs are also scrutinizing SaaS budgets with a new intensity, demanding visibility into how software investments deliver true value. They’re no longer satisfied with high-level spend metrics — finance wants granular insights into feature-level usage, duplicate capabilities, and to see how their SaaS dollars turn into effective employees.

Fighting these challenges goes far beyond simply maintaining order. Successful IT governance is essential for survival and financial sustainability. Whether you’re a seasoned CIO balancing security with business enablement, or an emerging tech leader trying to optimize your SaaS ecosystem, understanding and implementing effective IT governance has never been more critical toward providing visibility and control while supporting, not hindering, business innovation.

What is IT governance?

IT governance centers around the fundamental processes and relationships that direct and control an organization’s IT operations through a framework of policies, procedures, and processes. It makes sure that IT systems support the organization’s goals, helps manage risk, and ensures compliance with regulations.

The need for robust IT governance has never been more critical. Software spend is projected to rise 14% in 2025 to total $1.2 trillion in 2025, according to Gartner. Yet, the average enterprise is wasting 40% of their annual SaaS spend through underutilized licenses, redundant applications, and poor adoption. And these numbers are expected to rise with the expansion of AI tools and capabilities. 

At its core, IT governance encompasses the frameworks and processes that align technology investments with business objectives. But in today’s SaaS-dominated landscape, it’s evolved far beyond what worked for on-prem and VPN environments. Booming SaaS portfolios make modern IT governance a complex challenge of visibility, optimization, and risk management.

And the stakes are high. In 2024, 23% of organizations have increased their technology investments, spending roughly 7.5% of their total annual budgets on digital spend, according to Deloitte. But despite this investment, the same study found that 58% of businesses lacked the transformation strategy to effectively execute on their SaaS investments. 

It’s no longer about simply tracking what software you have. IT leaders need a clear line of sight into how SaaS drives value across your organization. The real challenge isn’t just seeing what applications you have — you need to know how they’re actually being used at the feature and capability level. 

Without data about feature usage, organizations can’t identify redundant tools, optimize licensing costs, or demonstrate how their technology investments translate into productive employees. The difference between basic oversight and true governance comes down to having deep, actionable insights about how employees engage with their tools, allowing IT leaders to transform from gatekeepers into strategic partners who can make data-driven decisions about their SaaS portfolio.

Why is IT governance important?

Organizations implement information technology governance structures to create repeatable systems and processes to manage IT resources, risks, and opportunities — but what that governance looks like varies significantly across each stage of the SaaS lifecycle. 

Today’s IT leaders must balance business agility with responsible resource management, shifting away from 2020’s “growth at any cost” approach to SaaS adoption. A well-designed governance infrastructure helps organizations balance competing demands at each stage of the SaaS application journey by providing clear guidelines for decision-making and risk management from intake and implementation, all the way to renewals and employee offboarding

Phases of IT governance:

• Better strategic alignment: Ensure IT initiatives support business objectives by creating clear links between technology investments and business goals. Front’s IT team focused on this objective by using engagement data at the feature level, team by team, to align finance and procurement around a 20% reduction in their SaaS portfolio, saving $600K in the process. Actual usage data empowers organizations to avoid wasted SaaS spend and deploy IT resources for maximum impact.

• Improved resource allocation: By implementing things like automated 30-, 60-, and 90-day renewal notifications, organizations can proactively manage license assignments, identify underutilized resources, and plan renewals strategically rather than reactively. 

• Better risk management: Getting visibility into all your SaaS apps by consuming contract data, expenses, connecting to SSO and Engagement connectors gives you what you need to analyze usage data. This allows you to to remove or downgrade underutilized licenses, minimize the risk of unauthorized access through orphaned accounts, and get a complete picture of your risk surface area. 

• Increased accountability (and reducing tickets): Clear roles and responsibilities for IT decision-making and implementation help leaders involve the right people in key decisions and monitor and measure outcomes effectively. By utilizing a one-stop-shop for all app requests VTS empowered departments to manage their own SaaS resources while maintaining IT oversight, reducing access request tickets by 50% in the process. 

• Improved performance tracking: Enables measurement of IT effectiveness through established metrics — like budget and usage — and monitoring processes. Using a single pane of glass view into their entire SaaS portfolio, allows businesses to instantly visualize engagement patterns, track spending across departments, and identify optimization opportunities.

• Enhanced compliance: Route employee app requests into the right channels reduces risky shadow IT and unmitigated spend.

10 best practices for IT governance implementation:

Successful IT governance implementation requires careful attention to several key best practices. Consider the following as you move to develop and refine your approach to governance:

1. Integrate IT strategy into core business planning
   IT infrastructure must be viewed as a critical component of business strategy rather than just a support function. Armed with real-time engagement metrics on app adoption, feature usage, and more, IT leaders can feel confident about every business decision. Consider establishing regular communication channels between IT and business leadership, using actual usage patterns to demonstrate clear ROI and guide strategic SaaS investments.
   
   
2. Structure your governance strategy with adaptability in mind
   Technology and business environments are constantly in flux, and flexibility crucial for long-term success. As organizations scale, the ability to identify duplicative apps becomes essential for maintaining effective governance. 
   
   
3. Choose your tools strategically
   Leverage price benchmarking data to ensure competitive rates and negotiate better deals, while focusing on tools that support existing processes. Be sure to also consider your organization’s capacity to implement and maintain them effectively.
   
   
4. Align the right people
   IT has to work closely with procurement, finance, legal, and security every day. They need data to quickly align around decisions to minimize meetings and email threads. The team at Axon was able to align their IT and procurement teams around shared goals using centralized SaaS data, and ultimately saved $280K a single contract renewal. 
   
   
5. Get better visibility into performance metrics
   Tracking application usage and maintaining transparent performance reporting allows IT to operate strategically. Gainsight centralized visibility into their entire portfolio, saving $1.2 million across 104 renewals with centralized visibility.
   
   
6. Establish accountability 
   Clear ownership is essential for effective governance. By empowering teams with feature-level usage data and application engagement metrics, organizations can enable departments to make informed decisions about their own technology needs while maintaining central oversight. This ensures that all stakeholders understand their roles in the governance process.
    
   
7. Foster a culture of frugality
   Accurate usage metrics empower IT leaders to conduct more honest and effective vendor negotiations. Armed with comprehensive utilization data, organizations can right-size their licenses and build trust with vendors through fact-based discussions rather than on assumptions.
   
   
8. Always include compliance 
   While governance extends beyond compliance, it’s still a critical part. A strategic approach to compliance starts with comprehensive visibility into both IT-approved and shadow applications, enabling organizations to monitor regulatory requirements and maintain proper documentation. 
   
   
9. Prioritize effective — and early — risk management
   Effective risk management should be integrated into all aspects of IT governance from the earliest stages, with automated SaaS discovery serving as a critical first line of defense. Continuous monitoring and automated security assessments enable organizations to transform shadow IT into properly governed business-led IT while maintaining robust security standards.
   
   
10. Invest in employee training
    Only 60% of SaaS applications in a typical portfolio are actively used by employees — if you want to get value out of your SaaS investments, improving adoption is key. Developing role-specific training and clear procedures for requesting and adopting new tools, organizations can improve their SaaS ROI while ensuring employees understand their role in maintaining IT governance.
    

The role of IT is changing dramatically, but the right governance process and tools bring you the right data to ensure your company has the right tools when they need them, that the tools have gone through the proper review quickly and efficiently, and that you give your partners in finance and procurement the visibility they need without renewal fire drills.