I’m thrilled to announce that I’ve joined Productiv to run marketing. I’ve been looking for the next interesting problem to solve in technology – and I think I’ve found layers and layers of compelling opportunities in the SaaS Management space.
So what’s Productiv, you ask? Let me put it this way – you know those hundred different apps you log in to at work every day? The 5 tools your teammates use that do some of the same stuff – but no one uses quite right? Your wish that the company had a better tool to do X? Your app stack at work is kind of a mess, right?
Productiv brings together the information scattered across all of your SaaS applications to give you a single point of control and management for it all. The product’s license management capabilities can typically save a business 30% of its SaaS spend, but what’s more interesting to me is that Productiv unlocks the data that empowers IT teams to drive a company-wide SaaS strategy.
Let me walk you through the market dynamic today and where SaaS Management will likely be going in the future. By the end of this post you’ll be scratching your head and asking, “Why hasn’t anyone solved this before?”
Start with a $150 Billion Dollar Problem
Technology professionals have gotten over the “revolutionary” aspect of Software-as-a-Service. We’ve been using it for a couple decades, and we’re comfortable with sending our data off to someone else’s cloud in exchange for ease of use and a continual barrage of new features.
If we step back, we can see that SaaS is still growing at a breakneck speed. By 2022, SaaS is forecast to be a $150 Billion (yes, with a B) market segment, doubling in about 4 years. Companies spend on average $12,000 per employee on these applications.
The SaaS market is roughly equal to Platform as a Service (PaaS) and Infrastructure as a Service (IaaS) combined. All that, and it’s expected to grow at a 17-22% growth rate for the foreseeable future, beyond the forecast. Oh… and despite that, it’s still just about 4% of total IT spend globally.
That. is. Unbelievable. Growth.
With even greater potential.
There are a number of reasons why this is happening, but fundamentally the SaaS transformation we’re witnessing is harnessing a few key trends within enterprises:
- Companies are automating more workflows. The efficiency with which software companies can create SaaS means that more and more inefficient workflows can be replaced with purpose-built applications.
- Digital Transformation is SaaS Transformation. IT teams have used SaaS as a critical part of digital transformation efforts. Whereas before it might have been fine to try and “build your own” in house apps for each use case, speed and efficiency demand that you get into SaaS applications now, regardless of what you decide to do in the long term.
- IT isn’t the primary buyer. Without the need to setup and configure software, many SaaS vendors can sell directly to line of business users, making IT teams reactive supporters vs primary purchasers.
So, with enterprises moving to SaaS at an increasing rate, let’s talk about how SaaS is managed today.
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The House has stacked the deck: With 10,000 Cards
With this kind of growth, you won’t be surprised to hear there are tens of thousands of SaaS companies out there. I tried to find a number – even a ballpark figure – somewhere out there, with no luck.
As a proxy, let’s just consider one industry (one close to my heart) – Marketing. The annual MarTech landscape shows just about 8000 SaaS companies in 2019! Look at that graphic! This same research was tracking just 1,000 vendors in 2014. By the way – I can’t help but laugh at the fact that they call it the MarTech 5000 – seems like they’ve outgrown the name.
Imagine expanding this to all the industries, and all the functions out there. Now you’re getting a sense of the massive scope and sprawl of SaaS.
Imagine the challenge of walking into an IT role in even a medium size company today and trying to get a handle on SaaS:
- How many SaaS apps do we actually have?
- How much do we spend?
- What of that spend is IT-managed versus line-of-business versus employee purchased?
- Is that spend actually utilized?
None of these are rocket science questions, yet they are almost impossible to answer today. I won’t get into the specifics around how Productiv does it, but it’s these foundational questions where customers usually start.
So let’s see where SaaS Management is heading.
From Managing Change… to Leading Change
In many ways, the shift to SaaS has forced IT teams into a reactive mode of software management, versus being in a proactive position to improve company operations and efficiency.
As Red Hat CIO Mike Kelly has noted, “Good IT teams manage change. The best ones lead change. As the pace of change accelerates today – and at a time when technology is in many respects the asset of a company – organizations are demanding their IT departments demonstrate more leadership than ever before.
As an IT leader tasked with the challenge of making teams more productive and simultaneously reigning in costs / risk, this is an unbelievably challenging situation. Just think about the depth of understanding you need to be an effective change leader, beyond those basic questions we asked earlier:
- So we know what we’re using, are they the right applications?
- Are we making full use of the software? Are there capabilities that we should be leveraging but we’re not? Are we actually leveraging those new features released by the vendor every week?
- Could we extend this software to others in the organization? Would others benefit?
- Do we have islands of apps in departments, where they should be connected?
- What about those Shadow IT apps? Are they actually showing us an unmet need in the organization?
This is where things start to get interesting. What if you had a system that distilled all the information scattered across SaaS applications so you could understand how people were using them? And what if you could now make this data accessible to every line of business leader, every function, and the entire C-suite, to create a conversation of how you can strategically leverage this massive investment?
An actual screenshot of the “Collaboration Graph” within Productiv, showing how this one company uses Slack.
What if, as an IT leader you actually had the time and knowledge to ask, “What if?” and answer that question for any part of the business?
This is what Productiv will do for companies. This is what Productiv will enable for CIOs. This is why I joined Productiv.