Struggling with SaaS management? Tackle the entire lifecycle

Today’s SaaS (software-as-a-service) portfolios are more complex than ever, and current processes can’t keep up with the explosion of applications. With the average tech stack containing 342 applications—and enterprise organizations reaching up to 536—effective SaaS management is crucial. Without it, unmitigated SaaS sprawl can seriously impact your business, leading to inefficiencies, wasted resources, and increased risk.

To put that risk into context, 69% of organizations reported that they have been compromised due to an unknown, unmanaged, or poorly managed external asset, according to a 2022 study from IBM. This is often the case when teams are working with siloed data, ineffective collaboration, and a lack of visibility into their SaaS portfolio. 

When it comes to effective SaaS management, focusing on just one aspect of the SaaS lifecycle won’t get you very far. Yes, being able to easily access your contracts in one place can result in better vendor relationships and negotiations. Of course, comprehensive app discovery can lead to huge cost savings and a reduction of risk. Sure, workflows reduce unnecessary touchpoints and speed up processes. But the true magic happens when you blend the entire process — and your teams — together. 

What is SaaS lifecycle management?

SaaS lifecycle management is a framework for managing the entire lifecycle of SaaS applications within an organization. It goes beyond the individual steps of SaaS management, such as managing licenses, and focuses on aligning teams around like-goals to optimize the value an organization gets from its SaaS investments. 

When IT and Procurement work together in the same platform, off the same data, with shared processes, and toward the same goals, the outcomes are undoubtedly better for the CFO and the entire company. Spend under management increases, duplicative software costs decrease, adoption of in-house solutions improves, and average cycle-times get cut almost in half.

There is often a mindset of us vs. them when it comes to IT and Procurement. But while they’re often pitted against each other due to budget constraints and conflicting priorities, utilizing an SMP that provides SaaS lifecycle management to streamline workloads and align on goals can drive better results for all involved. 

Why does traditional SaaS management no longer cut it?

The true value of an SMP that provides SaaS lifecycle management lies in its ability to transform how organizations approach and utilize SaaS applications. Here’s why a data-led, holistic view of the SaaS lifecycle is far more effective than simple SaaS management:

• Unleashing the value potential of SaaS: An overview of the Saas lifecycle goes beyond simply managing licenses and contracts. By providing a centralized platform with comprehensive data on SaaS usage, spending, and performance, it empowers organizations to unlock the full potential of their SaaS investments. This data can be used to identify opportunities for cost optimization, improve user adoption by highlighting underutilized features, and negotiate better pricing with vendors based on actual usage patterns.
• The power of reliable, consistent data: Making informed decisions about SaaS requires reliable, consistent data that cannot be achieved through manual processes or siloed information sources. SMPs that focus on SaaS lifecycle management will automate data collection and aggregation, ensuring a single source of truth for all SaaS-related information. This eliminates the risk of errors and inconsistencies that can lead to poor decision-making.
• Business-owned applications: Governance, not elimination: The rise of business-driven SaaS adoption doesn’t have to be a threat to IT control. The right SMP will provide a framework for governance, not elimination. By establishing clear policies and approval workflows within a SaaS Management Platform (SMP), organizations can empower business units to choose the solutions they need while ensuring they meet security and compliance standards.
• Seeing the big picture: The power of diverse perspectives: A critical advantage of SaaS lifecycle management is its ability to bring together different team perspectives. Procurement can leverage usage data to negotiate better contracts, IT can identify integration opportunities and potential security risks, and business units can track the impact of SaaS on their specific goals. By fostering a collaborative environment with shared access to this centralized data, SMPs with SaaS lifecycle management empower teams to make better SaaS decisions that benefit the entire organization.

SaaS lifecycle Management goes further than simply managing SaaS; it unlocks the strategic value of SaaS investments and fosters better employee relationships. By providing a unified platform for insights, collaboration, and governance, organizations are empowered to make informed decisions, optimize costs, and maximize the transformative power of SaaS applications.

7 ways SaaS lifecycle management allows IT and procurement to find collaborative harmony:

Building a strong collaborative relationship between IT and Procurement requires a shift in mindset and a commitment to working together throughout the entire SaaS lifecycle. Here are some practical steps both departments can take to achieve better collaboration:

1. Aligned vendor selection and management:

• Joint discovery: Instead of IT identifying vendors in isolation, involve Procurement in the early stages of the selection process. This allows for a more holistic evaluation that considers both business needs and technical feasibility.
• Collaborative contracting: Let Procurement leverage its expertise in contract negotiation while IT highlights potential security risks and integration challenges. This collaborative approach ensures watertight contracts that meet both business and technical requirements.
• Shared decision-making: Develop a transparent decision-making process where both IT and Procurement have a say in selecting the winning vendor. This fosters a sense of ownership and accountability for the chosen solution.

2. Data-based decisions:

• Shared analytics platform: Implement a SaaS Management Platform with comprehensive data insights to provide both IT and Procurement with real-time knowledge of SaaS usage, spending, and performance. This shared access to data fosters better understanding of team goals and needs, and areas for improvement.

3. Tech stack review:

• Joint assessment: Conduct a joint review of the entire SaaS portfolio to identify potential overlaps and opportunities for consolidation. Approaching a review simultaneously can save time, streamline SaaS usage, and optimize costs.

4. Streamlined procurement process:

• Intake management: Establish a centralized intake process for all SaaS requests. This ensures proper vetting by both IT and Procurement before any purchases are made.
• Alignment with Finance: Integrate the SaaS procurement process with finance departments to ensure proper budgeting and tracking of SaaS expenditures.

5. Opt for a cost avoidance mindset:

• Proactive management: Move beyond the reactive approach that basic SaaS management takes. Develop a proactive cost-avoidance mindset by regularly reviewing usage data and identifying opportunities to optimize subscriptions or negotiate better pricing with vendors.

6. Reducing touchpoints and meetings through automation:

• Integrated workflows: Leverage automation tools in your SMP to streamline workflows and reduce unnecessary touchpoints in the procurement process. This improves efficiency and minimizes the risk of errors.
• Standardized processes: Develop standardized processes for vendor onboarding, contract management, and user provisioning. This ensures consistency and accuracy across all SaaS acquisitions.

7. Adopt a tool that does it all:

• Consider implementing a comprehensive SaaS Management Platform that focuses on the entire SaaS lifecycle. It should offer a centralized platform for all SaaS-related actions, fostering collaboration between IT and Procurement throughout the entire lifecycle – from selection and procurement to ongoing management and optimization.

By adopting these solutions and fostering a culture of open communication and collaboration — and with a SaaS Management Platform that focuses on the entire SaaS lifecycle — IT and Procurement can transform their relationship from one of competition to a powerful partnership that drives successful SaaS adoption and innovation throughout the organization.