What to Look Out For in a SaaS Agreement

Software companies create SaaS agreements to lay out their legal terms and conditions for customers using the software. However, these tools aren’t just beneficial for the provider. Subscribers should also understand the purpose of a SaaS agreement and be aware of the language that could impact the way they use their software investments.

Let’s look at some specifics:

What is a SaaS Agreement?

Simply put, a SaaS agreement is a software provider’s service agreement according to their delivery model. For SaaS software products, the provider will deliver the software and related data via the internet instead of a physical product.

This agreement is also referred to as the terms and conditions that detail how the software can be accessed and used. It typically includes a variety of information, including a privacy policy, termination requirements, disclaimers, usage requirements, restrictions, and additional details.

When you sign up for a new SaaS product, it’s easy to accept the terms and conditions without reading them. A study by Deloitte found that 91% of Americans never read the terms of service.

For the most part, these clauses are fairly standard. But that doesn’t mean they’re all the same. It’s especially important for businesses to understand the unique service terms for each of their software tools to avoid potentially costly implications.

Why You Need a SaaS Agreement

For software providers, it’s easy to see why SaaS agreements are necessary. Think of it as a protective legal blanket that details your obligations to the customer and also holds them accountable for how they use the software.

Users can also benefit from understanding what’s inside a SaaS agreement. For starters, your agreement will spell out important things like licensing requirements, service level guarantees, and how your data will be used.

You don’t want to be locked into unfavorable terms that could impact how you do business.

For example, it’s important to define the ownership of data collected and stored by your SaaS. How will the provider protect customer data? What is the provider’s obligation to destroy data if you choose to no longer use the software?

Though reading terms and conditions before clicking “I Accept” is no one’s favorite thing to do, it can make a difference in how you select tools to add to your SaaS stack moving forward.

What to Look For in a SaaS Agreement

Every SaaS agreement will be a little different, but they all share some of the same basic types of clauses and terms. Here are a few of the most ones to look for:

Data Ownership

Both the software provider and users generate data when using the software. SaaS agreements should outline who owns the data that users enter into the platform. This can be a gray area since SaaS providers are responsible for hosting the customer data. It’s also a good idea to look for how data is being stored and transmitted, as well as any restrictions on data access.

Data Security and Usage

SaaS agreements should include a privacy policy that details how the provider is using your data, including the information it collects and shares internally or with third parties. This section also includes information on data encryption, how data is backed up, and the provider’s role in the event of a data breach or security issue.

Licensing Rights and Access

One of the most important (and yet often overlooked) components of a SaaS agreement is how you’re allowed to use your license. This is a condition that can vary widely between providers and can impact how much you pay for your software tools.

Most companies will stipulate that you do not own the app. Rather, you are purchasing a license to use their software. It also determines how many users can access the software per license. A common model today is the pay-per-user, where companies purchase a specific number of “seats” for a software product. Others may offer up to a certain number of users for a flat rate. Something to look for is the definition of a user to ensure you’re paying for the right number of users per license.

Pricing Terms

SaaS agreements should include a section on how much they’re charging, what specifically is included in the price, and how often they’re charging. Most companies will charge on either a monthly, quarterly, or annual basis.

Termination and Renewal Requirements

If you decide a software product no longer meets your needs, you might not be able to cancel your contract right away. Check the SaaS agreement to see how to cancel the service, whether the service is prorated if you cancel in the middle of an agreement, and what happens to your data when you cancel.

Likewise, you’ll also want to see how the provider handles renewals.

  • Are you locked into your initial price, or will your renewal be subject to their current rates?
  • Will you need to renegotiate your enterprise contract prior to renewal?

Most providers have evergreen renewals, which means they do not require any action on your part.

Service Level Agreement

Most cloud service providers include a service level agreement, or SLA, within their SaaS agreement. An SLA is designed to set minimum performance standards, especially in regard to service availability. Check the uptime percentage of the software – the lower the percentage, the greater an impact it might have on your user productivity.

Manage Your SaaS Agreements with Productiv

Knowing what to look for in a SaaS agreement can be extremely helpful when vetting new software solutions. It’s important to encourage your company’s decision-makers to read the terms and conditions prior to accepting them to ensure you’re not locking yourself into a contract that doesn’t fulfill your needs.

Productiv can help manage the many aspects of your SaaS portfolio, including renewals, termination details, and licensing requirements, to help you better understand how your company’s software is being used and the ROI it delivers. Users can store agreement details within the app so that critical details are available when it’s time to renegotiate rates and renewals.

When you can collect SaaS agreement-level data, you gain more insight into the terms and conditions that typically fall by the wayside. And once you recognize terms that are unfavorable to you, you can ensure those apps don’t remain in your stack and start to develop best practices for your team when investing in new software tools.

Would you like SaaS without the Mess? Try Productiv! 

How Data-Driven SaaS Contract Management Can Reduce Your Costs

Admit it: you’ve clicked the “I have read the Terms and Conditions” checkbox on a SaaS contract before without actually reading the terms and conditions. It’s become such a standard process that 91% of people steamroll this step and don’t give it a second glance.

As an average consumer, your concerns stop once you click that box. But as a company paying a good chunk of their budget for SaaS tools, you should know that clicking the “I agree” box is just the start of SaaS contract management.

When you engage a software vendor for a service, you’re not just trading money for a commodity service. Contracts can not only impact how much you pay for a software product, but also the level of support you receive, the tools your business needs to thrive, and legal protections for your business in terms of how data is owned, shared, stored, and used.

As a result, SaaS contract management creates a number of challenges for companies without an organized approach. The good news: following a few best data-driven practices can create opportunities for companies to improve their spending on SaaS tools, build more favorable relationships with vendors, and experience less friction within their business.

Why You Need Data-Driven Visibility into SaaS Contract Management

Enterprise SaaS contracts look and function differently than boilerplate click-through contracts. Where standard agreements strive to appear as a one-size-fits-all contract, an enterprise agreement is negotiated by both sides to create win/win situations. It’s this difference in language and flexibility in terms that highlight the importance of managing (vs. blindly accepting) all SaaS contract details.

Here’s why:

Employee Acceptance Means Company-Wide Enforcement

App ownership is all over the place. In today’s organization, it’s not just IT departments who are making software investments, but also teams and individuals who are selecting their own tools. This has been compounded by the effects of COVID and the mass exodus from the office to the home office, where employees had to shift into survival mode and use whatever programs they could to work.

There are a lot of downsides to this, starting the moment the terms and conditions are accepted. When an employee agrees to a business-use contract, they’re deciding for the company that click-through terms will be upheld.

Click-Through Contracts Favor the Vendor

Standard terms and conditions are written by the vendor to cover their interests. Cookie-cutter language isn’t designed to take your unique company’s needs, risks, and desires into account.

Enterprise Contracts Can Lower Costs

Because app ownership is increasingly disparate across the enterprise, it’s common to see multiple instances of the same software (e.g. multiple teams using the same tools but under different accounts). Consolidating redundant apps under an enterprise license can help to increase buying power, as well as negotiate on price, the number of user seats, support plans, and other specifics.

Contract Negotiations Create Stronger Relationships

SaaS contract management is an active process, whereas click-through contracts are not. Because negotiating contracts requires conversations with vendors, you’re more likely to get a contract that better suits your company. Also, vendors get to know you and your company on a deeper level and may be able to provide recommendations and better support.

It’s also worth pointing out that when you take an organized approach to SaaS contract management, such as using a software like Productiv, you’re getting data-driven insights into each contract’s unique details.

Managing these details at scale removes much of the guesswork and manual effort from the process so you can focus on the most important aspects of each contract.

SaaS Contract Management Best Practices

Every SaaS contract is a little different. To gain a better hold on SaaS contract management, put the following best practices to work:

Create a Searchable Database of SaaS Contracts

A detailed system of record for all SaaS contracts can be a goldmine of information. For starters, it allows you to search for specific elements within contracts in seconds. It can also show you at a glance how many software tools you’re paying for, how much you’re paying, and other details that impact your bottom line.

Productiv is designed to improve SaaS contract management by bringing all of your contracts under the same umbrella. It’s more efficient than spreadsheets and doesn’t require the heavy manual aspect to input or find key details.

Develop Best Practices for Purchasing SaaS Tools

Today, many software tools can be purchased without an enterprise-level negotiation. All a user needs is a company credit card and they can add new software tools to the organization without going through an approval process.

This leads to:

  • App redundancy;
  • Higher software costs;
  • The risk of abiding by terms and conditions that don’t favor the organization at large.

To overcome these instances, companies should consider putting specific protocols in place that determine how new software tools are brought into the company.

This should include adding each new purchase to your SaaS contract management software (like Productiv) so all contract details are kept together.

Use Data-Driven Insights for Contract Negotiation

When you have a SaaS contract management software like Productiv, use the data you collect to fuel future negotiations with vendors. Things like app usage, specific feature usage, and even the ROI each app delivers may be able to help you get more favorable pricing when it’s time to renew.

How SaaS Contract Management Software Brings Visibility to the Enterprise

There’s a steep price of not managing SaaS contracts. When you fail to be proactive, you risk paying more for your software services, or worse, not having the service live up to your needs or expectations.

Productiv helps to remove this risk by helping you gain data-driven insight into every software contract at scale. By storing important details like contract durations, renewal dates, user licenses, costs, features, and even app usage by user, companies are in a better position to negotiate on terms that matter to them.

Say Goodbye to the SaaS Spreadsheet! Try Productiv to bring clarity to SaaS contract management.

Introducing Compliance Insights in Productiv

CIOs depend on Productiv for a complete, 360-degree view of their application portfolio. Having this view provides more effective governance and transparency across SaaS applications, in a way that is easily shared across the organization. 

An important part of this governance is understanding risk, especially when it comes to external software vendors to whom you entrust your data. To effectively manage security concerns and risk, your IT and Information Security teams need insight into the compliance certifications of each app in your application portfolio. 

With Compliance Insights, this information is now available to your team across all of your applications. Previously, information about whether application compliance was scattered across the web, making it difficult to answer important questions like: 

  • We’re preparing for an audit, which applications are not SOC2 compliant?
  • We are expanding to Europe, are our applications GDPR compliant?
  • Do recently discovered apps (Shadow IT) meet our compliance requirements?

Moreover, hunting down this information, recording it, and keeping it up to date could easily consume hundreds of person-hours per year. That’s wasted, low value effort that could be spent on more strategic efforts. Productiv has now eliminated this burden, giving you the information you need while eliminating the heavy lifting involved.

As always, Productiv leverages its unique approach to give you greater insight into compliance. While others approach SaaS management as a license-based exercise, Productiv starts with user-based analytics, and builds up from there. That means you’ll be able to see compliance data at all levels of the Productiv experience. You’ll see this a little later in the post. 

The new Compliance Insights feature introduces new compliance visibility across your application portfolio:

  • Compliance certification status across the Productiv experience, including at the App, Team, and User level
  • Support for key compliance types: FedRAMP, Fisma, GDPR, ISO27001, SOC2, Swiss-US Privacy Shield
  • Flexibility to show only the certifications that matter to your organization

Let’s take a look at Productiv to give you a sense of what to expect.

First, we can examine our Managed Applications. These are the ones that IT typically has the most control over. In this example, you can see great coverage across GDPR, SOC2, and ISO27001. 

This is easily customizable. Using the “Certifications” pulldown in the upper right, you can select which certifications that you’re most interested in examining. 

Here we see the six certifications available within Productiv today: FedRAMP, Fisma, GDPR, ISO27001, SOC2, Swiss-US Privacy Shield. More on each of these later in the post.

While this kind of compliance coverage is expected when IT teams are heavily involved in selecting and managing vendors, what about the applications where the business brings something onboard without IT support? Let’s take a look at the compliance insights across your shadow IT footprint.

Here you see the applications that Productiv automatically discovered through integrations with your spend systems and network systems. Using the same certifications as above, we see significantly spottier coverage for compliance.

Now IT can see instantly where they need to spend their time to most significantly reduce their risk of exposure. Shadow IT features like trending applications and newly discovered applications allow IT to keep focus on where the most activity is, and what new applications are taking hold in the organization.

Finally, let’s say you have teams that have special compliance requirements because of the information that they deal with, or where they are located in the world. One of the core differentiators for Productiv is that we build SaaS management from the user level – not just the license. What that means for compliance insights is that we can easily give you flexible, customized views of your compliance data down to an individual or a team. For example, below you see our compliance insights scoped down to the Data Science team. This level of data is useful for Information Security to validate if this team is in compliance, but also useful as you have a conversation with the Data Science team about applications that they are using, and ones they shouldn’t be using. 

Compliance Coverage

Lastly, let’s click down on the six compliance certifications that Productiv is launching within Compliance Insights. This list will grow and change as we continue to adapt to the demands of our customers and new certifications that appear on the market.

  1. FedRAMP – The Federal Risk and Authorization Management Program (FedRAMP) is a government-wide program that provides a standardized approach to security assessment, authorization, and continuous monitoring for cloud products and services. Any cloud service that holds federal data must be FedRAMP Authorized. FedRAMP prescribes the requirements and process cloud service providers must follow in order for the government to consume their service.
  2. Fisma – The Federal Information Security Management Act (FISMA) is a United States federal law passed in 2002 that made it a requirement for federal agencies to develop, document, and implement an information security and protection program. Though FedRAMP and FISMA are both built on the foundation of NIST 800-53, they have different objectives. FISMA offers guidelines to government agencies on how to ensure data is protected, while FedRAMP offers guidelines to agencies adopting cloud service providers on how to protect government data.
  3. GDPR – The General Data Protection Regulation is a European Union privacy law that comes into effect on May 25, 2018. … It increases restrictions on what organizations can do with your data, and it extends the rights of individuals to access and control data about themselves.
  4. ISO27001 – ISO/IEC 27001:2013 (also known as ISO27001) is the international standard that sets out the specification for an information security management system (ISMS). Its best-practice approach helps organizations manage their information security by addressing people and processes as well as technology.
  5. SOC2 – SOC 2 is an auditing procedure that ensures your service providers securely manage your data to protect the interests of your organization and the privacy of its clients. For security-conscious businesses, SOC 2 compliance is a minimal requirement when considering a SaaS provider.
  6. Swiss-U.S. Privacy Shield – The Swiss-U.S. Privacy Shield Framework was designed by the U.S. Department of Commerce, and Swiss Administration, to provide companies on both sides of the Atlantic with a method to comply with data protection requirements when transferring personal data from Switzerland to the United States in support of transatlantic commerce.
Making Compliance tracking easier and more complete

How well do you understand the risk associated with your SaaS portfolio? And just as important, how much work does your team need to put in to understand that risk? With Compliance Insights from Productiv your IT and Information Security teams have the details of compliance certifications of each app in your application portfolio. 

Compliance Insights are available now in Productiv within the Enterprise Tier. If you would like to see everything available within Enterprise, request a demo. If you’re just beginning your SaaS Management journey, consider signing up for Productiv Essentials, our free product available to everyone.

4 Questions with Mike Hamilton, Head of IT at Databricks

In today’s business landscape, one of the most critical roles of IT has become to manage the company’s ever-evolving list of software tools, particularly the ones that are now being offered as subscription services. But as the number of applications a company invests in continues to climb, managing the entire range of applications becomes more complex and time-consuming.

IT leaders with expanding software as a service (SaaS) portfolios need to feel confident that each app in their suite creates real business value. What’s more, they need an easy way to visualize their portfolio so that surprise renewals don’t catch them off-guard and they don’t end up paying for more than what they really need.

In a recent webinar, we spoke with Databricks’ Head of IT Mike Hamilton to learn how they keep a firm grip on their SaaS portfolio as they grow.

Q: How does a high growth company like Databricks approach software management, especially during a sudden shift to remote work?

Mike: Coming into Databricks from another high growth company, I was surprised to see just how much faster Databricks was growing. At the end of 2018, Databricks had around 300-400 people. Fast forward one year later and we’ve reached 1300+ employees (anywhere from 50-80 new hires every month).  

With any growth, you’re going to have challenges, pandemic or no pandemic. For us, our growth has increased the need for process maturity that can help us function more like a well-oiled machine. We have more people depending on us for IT, and those processes can help to save us time, gain clarity into the software tools we really need vs. ones we don’t, and better serve other employees. 

The pandemic was like hitting a wall. We were still doing well as a company, but we took this time to shore things up in IT and ensure we can continue to scale the business and mature our processes. We’ve gone from a Wild West-type startup with minimal processes to a point where you need to know whether your processes and metrics are adequately serving the business. And, being in a data company, you’re kind of expected to know the data on just about everything.

Q: How do you take a company’s IT from a Wild West frontier to one that’s smart, fast, and flexible?

Mike: The Wild West period of startups is where there isn’t really a formal purchase process. Engineering just kind of does its own thing. This means that teams are constantly buying new apps and add-on licenses. But for IT, we need to know how that spend is actually useful. 

The problem, however, is that if we are constantly buying and expanding, how do we make room for strategic investments? This “testing phase” can be great for innovation, but at some point, we need to shift to a scalable solution.

We look at everything from a data standpoint: we want to understand how SaaS products overlap each other, whether there’s redundancy in spend (especially when working in a tight startup budget), and how teams are using these products in different use cases. Our goal in IT is to provide a consultative point of view on which tools we should or shouldn’t be using. 

Q: How did you decide on a solution to manage the SaaS sprawl?

Mike: When you’re growing as quickly as Databricks, doing nothing to manage the sprawl isn’t an option. The idea of using a spreadsheet was brought up, but that brought two major challenges: the effort it takes to create and manage the spreadsheet and gaining trust from the people it affects. 

We didn’t want to find ourselves constantly redoing the spreadsheet and trying to prove why the numbers are accurate. We wanted more of a data-driven, technology-based approach that would illustrate the ROI and strategic value of our SaaS data. This approach would also help us scale better than a spreadsheet could.

Q: Cost savings are important, but that wasn’t the main driver in implementing a SaaS management tool. What took priority over cost?

Mike: Strategically building a method to address business productivity felt like a smarter way to think about this challenge compared to just cost savings. I know this is a burning question on most people’s minds, but I think it’s just as important to understand the longer-term impact on software decisions.

For example, you might have a department that buys a particular tool or platform. But how do you know they’re really using it? This is something I noticed with our Zoom calls during the early days of COVID. We were using Productiv at the time and I could see more people turning on video after we had conducted an engagement survey. This was something we could measure.

Another piece is being able to see how tools are being used and being able to forecast future needs and spending. I want to be able to have the right conversations with the right decision-makers regarding software usage, and not all decision-makers have cost as their top priority. I need to think about software in terms of their goals and priorities, whether it’s usage and adoption rates, the number of licenses, or something else.

Being able to have these conversations fosters trust in the line of business, especially if I can put data behind the conversations.  

Final Thoughts from Databricks’ Mike Hamilton

The software-as-a-service model has created a number of benefits for users, including simplified buying cycles, rapid sign-ups, and hands-free renewals. But these benefits are often a bane to IT teams tasked with organizing and simplifying their suite of software tools. 

For Databricks, Mike believes that combining short term, medium, and long term needs can help them drive better software solutions. “To start, we need to know what applications we have and how much they cost. From there, we can drive the adoption of the right tools. And when this happens, we can look for ways to create better outputs for the business with the tools we have or, if needed, we can bring in better options.”

Hear the full webinar interview with Mike Hamilton here and to request a demo just contact us.

3 Free Ways to do SaaS Management

When it comes to SaaS management, there are two methods you could use:

  • A free method
  • Paid software

If you have a limited budget, free is obviously more appealing. In this blog post, we’ll explore three free SaaS management methods, including their advantages and drawbacks.

Free SaaS Management Methods

There are three free SaaS management methods out there:

  • Spreadsheets
  • Employee surveys
  • Free Tools
Spreadsheets

One free method of SaaS management is to use a spreadsheet to track all of your SaaS apps and platforms.

It’s probably one of the simpler methods for SaaS management, at least on the face of it. All you have to do is create a spreadsheet and start entering data.

Advantages of Using a Spreadsheet

There are a few advantages of using a spreadsheet for SaaS management:

  • It’s better than doing nothing at all
  • It doesn’t cost very much money to create

However, there are more downsides, and the downsides are severe enough to make this method not worth considering.

Cons of Using a Spreadsheet

What’s wrong with using a spreadsheet for SaaS management? Quite a bit, as it turns out.

  • You’re entering data manually, so there’s a very high chance there will be errors – there’s an average benchmark rate of 1%.
  • Spreadsheets don’t automatically update, so you don’t know when changes are made to a SaaS license or when new subscriptions are added.
  • There are too many things to track in a single spreadsheet: the cost per subscription, renewal dates, app ownership, the app’s compliance status, onboarding processes, security, and privacy.
Employee Surveys

Using an employee survey is another free SaaS management method.

We’re familiar with employee surveys to measure engagement or job satisfaction, so this method is a creative take on something many companies are using anyway. If you’re already using a survey tool, then you’re not paying anything extra. Also, there are a number of free survey tools online, and creating a survey doesn’t have to take very long.

Advantages of Employee Surveys

As we mentioned previously, the first advantage of employee surveys is that they’re free – either you already have employee survey software in place, or you could use a free online tool for this purpose.

The second advantage is that it engages employees in SaaS management. Shadow IT has become an issue within the enterprise; a Cisco survey shows that there are 15 to 22 times more cloud applications running in the workplace than the IT has authorized. A survey could create greater transparency into shadow IT.

Cons of Employee Surveys

There are a few problems with employee surveys:

  • Some employees are so busy; they don’t have time to fill them out.
  • There’s no way to guarantee anonymity, so some employees refuse to fill them out.
  • You have no way of knowing whether employees are being truthful or not.
  • Employee surveys have no way of tracking actual application usage.
  • You can’t expect employees to have all the details about a SaaS app or platform (the cost per subscription, renewal dates, etc.)
  • Even if you do have that information, you don’t know it’s accurate.
Free SaaS Management Tools

SaaS management tools are software that tracks the applications and platforms you have. There are free SaaS management tools available – let’s explore the pros and cons of them.

Advantages of Free SaaS Management Tools

The biggest advantage of free SaaS management tools is that they’re more accurate and reliable than the two other methods we’ve mentioned here.

SaaS management tools integrate with your technology stack to give you visibility into the apps and platforms your organization uses. There’s no manual data entry, nor is there any relying upon employees to voluntarily share which apps they’re using.

Cons of Free SaaS Management Tools

Does the thought of free SaaS management tools sound too good to be true? It can be.

You might be offered a 30-day free trial. Or, the features in the free SaaS management tool are limited – you may only be able to access certain capabilities as part of the free trial, which doesn’t give you a true sense of how the SaaS management solution works. Moreover, you might be limited by the number of users. It’s a frustrating situation for organizations that want to improve their SaaS management while staying within their budgets.

A New Free SaaS Management Solution: Productiv Essentials

Productiv Essentials is a free SaaS management solution with easy setup and excellent out-of-the-box functionality. To provide a better understanding of how Essentials works, let’s talk about what it isn’t:

  • It’s not a time-bound trial – you can use it for as long as you like
  • There’s no limit on the number of users – you can invite the entire IT team, Finance, Procurement, and even the C-suite
  • There’s no limit on the number of applications Essentials tracks
How Does Productiv Essentials Work?

There are three core components to Essentials:

  • Visibility: To gain a 360° view of your applications, Essentials allows you to connect your single sign-on system as well as finance systems so you can see Shadow IT and expensed apps.
  • Renewal management: Track critical renewal data to proactively manage and prioritize renewals.
  • Deeper insights into engagement: The key to understanding what value you’re getting out of your apps is measuring user engagement. Productiv Essentials provides a taste of this capability by enabling you to measure engagement with the video conferencing system of your choice.
The Benefits of Productiv Essentials

With Productiv Essentials, you can:

  • Manage your apps affordably, efficiently, and effectively
  • Save money on renewals because you’ll have the data to make better decisions
  • Gain deeper insights into how employees use apps and which ones they use

Essentials has ended its beta testing with satisfied users – now, we’re ready to open it up to even more companies. If you want a free SaaS management tool that gives you fantastic out-of-the-box features and delivers real value without any of the disadvantages of other free tools, click here to sign up.

4 Questions with HashiCorp’s Head of IT

The software-as-a-service model is designed to make doing business easier. This may be true concerning the specific apps you use, but juggling multiple subscriptions can become a chore in itself. 

Without careful management, companies risk paying costly renewals for underutilized tools, paying for duplicate subscriptions, and not gaining the full productivity benefits of their software suite. What’s more, these problems are compounded when you have a staff of hundreds or even thousands of employees that depend on software apps to do their job.

We recently sat down with HashiCorp’s Head of IT Jim Fazzone to discover how they stay productive and proactive in managing their SaaS portfolio for a team of more than 1,000 employees.

Q: HashiCorp is growing rapidly. What are some of the challenges this growth has created for IT?

Jim: When I started two years ago, HashiCorp had about 150 employees. Right now, we have more than 1000 employees – that’s like adding about 50 new employees every month. 

Given that we’re nearly a fully remote company (about 85% of our workforce was already working from home prior to COVID), this creates a lot of unique challenges for IT. 

For starters, because of our rapid growth, our number one priority simply became to keep people working. It’s not easy hiring that many people in such a short time span and technology plays a huge role in helping to get people to be productive the minute they come on board. This means opening a laptop and getting started on Day 1 without a bunch of complex processes to slow them down.

This is easier said than done with a remote workforce, especially from an IT perspective. We don’t have an enterprise firewall as you’d have in a traditional office setting, so we don’t have visibility into where internet traffic is going. 

We also don’t have the ability to block a site. People can sign up for programs and applications they feel they need, and we’ve found that needs can be very different across roles. Getting the right fit of tools to the right people takes a lot of thought, especially as we grow. 

Q: Before you came on board, there was no IT department at HashiCorp. How did you go about building the department and prioritizing the business’s IT needs?

Jim: In building an IT department from the ground up, one of my first priorities was to understand the landscape of the tools being used in the business. There were hundreds of platforms that a user could engage with every day. I needed to figure out which systems resided with each team, find out who the application owners were, and understand the use cases of those applications. I knew I needed to know more than just how to be an administrator for those users. 

These were big challenges, but I felt this was the best path to turning the current landscape of tools into “HashiCorp habits” that could scale as we grew. This way, our systems and applications wouldn’t be all over the place and could start to form an actual software stack. 

Q: What complexities arise with managing multiple software tools throughout the enterprise?

Jim: We have hundreds of applications, and keeping track of them manually is no longer an option. I found that some of these tools were ones that individual users had signed up for on a whim, while others were tools where the department had contacted a vendor, compared options, and had gotten approval to purchase. 

In total, I know we have somewhere around 225 software tools. This is a huge number, and it also means we have 225 contracts to manage, 225 points of contact, and 225 authentication mechanisms. When something goes wrong, we have to learn how to troubleshoot 225 different platforms. And when it comes time to renew or negotiate new rates for these tools, this means 225 different conversations with different vendors. At least half of my week comes from having conversations with vendors regarding price points, utilization, and contract language.

The real question I had was whether all of these tools were needed. I wanted to dive deeper into which ones were being used, how they were being used, and how often our employees were using them.

Q: What are some things you did to bring clarity and control to HashiCorp’s systems and applications?

Jim: Just knowing what was in our ecosphere was a major challenge. Often, we would discover a new tool because a user would submit a help ticket for it. We also needed to understand what people did with those applications, and who was using each application. I found all of this to be extremely helpful when bringing new people on board because I knew all of the tools I needed to set them up with right out of the gate based on their role and department.

I used to use a messy spreadsheet to manage all of this data, but it was all manual input. I didn’t have an easy way to manage the data pile I was sitting on. 

When we switched to Productiv, clarity, and control became natural byproducts. We had instant visibility into all of our known applications, how each one was being used, and which teams and individuals were using it. 

Something else that has been a tremendous help is being able to calculate the ROI of our software investments. When we think of the tools our people use as investments, we want to see rich data about what they’re doing with those tools. 

Productiv gives us visibility into engagement patterns and specific features that are being used, as well as tools and features that are potentially underutilized. This has proven to be a huge helper for us in renewal conversations and licensing considerations.

Final Thoughts

Software tools are designed to spur productivity for its users, but they shouldn’t come at the expense of productivity in the IT department. Using a better management system can help to reign in the SaaS landscape and create a powerful, effective suite of tools whose ROI can be unquestionably calculated.

Request a demo to learn how Productiv can help you improve your SaaS management process. 

 

How to Mitigate the Top 5 Risks of SaaS at Scale

As you scale your company, your SaaS applications and platforms also have to scale. Yet, as SaaS applications and platforms scale up, they bring a set of risks that can affect your entire business. Fortunately, there are also ways to mitigate those SaaS risks so that you can continue to grow and thrive.

As an IT leader responsible for your application portfolio, understanding these risks will not only help make your business more secure and cost effective, but it will allow you to bring a level of transparency to your operations that will help you build  better relationships with your functional business leaders.

Read on to learn what the top five SaaS risks are and how to mitigate them effectively.

What Are the Risks of SaaS at Scale?

Adopting SaaS at scale poses several challenges and creates a number of risks. The top five SaaS risks are:

  • Governance
  • Data privacy
  • Cost
  • Employee experience
  • Long-term application strategy

Governance

Governance is a significant risk as your SaaS applications scale up. As your company grows, the number of users, as well as the number of applications, rises too. There’s also quite a bit of data floating around.

Why is a lack of governance a risk? There are two reasons:

  • Financial
  • Security

From a financial standpoint, inadequate governance wastes money. You’re paying for SaaS applications and platforms, yet you don’t know who’s using them, how much they’re being used, or if these apps and platforms are even being used to their fullest potential. Moreover, research shows that without appropriate SaaS governance, your bottom line suffers. Studies demonstrate that organizations with above-average governance have over 20% higher revenue than their peers following a similar IT strategy.

The effects of poor SaaS governance can be more immediate if you’re looking through a security lens. Because you don’t know who’s using these apps, or how they’re being used, they represent a significant security risk. Research from the Cloud Security Alliance shows that over three-quarters of organizations that have adopted SaaS have experienced security incidents directly related to those applications.

Data Privacy

Another SaaS risk that’s connected to security is data privacy. The importance of data privacy has grown, as evidenced by recent laws regulating how companies handle individuals’ data.

When firms don’t practice proper SaaS governance, they can’t guarantee that all of the apps and platforms they are using fulfill legal and compliance requirements. As a result, they don’t know whether they are compliant with data privacy laws.  Even if an app itself might be compliant, no governance means that the company doesn’t know how the app is being used.

Cost

The cost of your SaaS apps isn’t a major concern when you first launch your company. You’re saving money because you’re not paying capital expenses. But what happens as you grow? That app that you originally thought of as a nice-to-have becomes an essential part of your processes, and for all of your employees to use it, you have to upgrade to the more expensive enterprise tier.

There are other question that arise too:

  • Are employees using all of the apps and platforms to which you’ve subscribed?
  • Is there any overlap between apps (for example, you might be paying for G-Suite, yet employees have set up Slack for messaging)?
  • Are there orphaned apps (apps with no clear owner and no proof anyone is using them)?

Research shows that firms between one and 50 employees have 25-50 SaaS apps, while firms of 250 or more employees use over 100 SaaS apps. If those apps aren’t being governed and managed effectively, companies will find themselves wasting money on apps that don’t drive their business forward.

Employee Experience

The concept of employee experience might not sound like it’s related to SaaS risks, yet there’s a strong connection. Moreover, employee experience, SaaS apps, and costs are also linked.

A well-curated SaaS app portfolio enhances  employees’ experience. It enables them to collaborate better and improve their productivity. Conversely, a bad app, or lack of access to the right app, or even not understanding which application to use when, has a negative impact on the employee experience. Our March 2019 report shows that over a third of employees reported low productivity because they couldn’t use the apps they needed.

“Over a third of employees reported low productivity because they couldn’t use the apps they needed.”

When employees have a good experience, the company benefits. Research from Gartner shows that employees who are largely satisfied with their jobs are:

  • Fifty-two percent more likely to report high discretionary effort at the workplace
  • Sixty-nine percent more likely to be high performers
  • Forty-eight percent more likely to meet the organization’s customer satisfaction goals
  • Eighty-nine percent more likely to meet the organization’s innovation goals
  • Fifty-six percent more likely to meet the organization’s reputation goals

Long-Term Application Strategy

When you establish your business, you’re focused on growth. You choose SaaS apps based on which ones can help you achieve your goals. As your business scales up, you might find your control over SaaS apps slips; at a certain point, you discover that apps have been chosen without any clear strategic direction.

As a result, your company might be:

  • Using apps that don’t support business goals
  • Subscribed to overlapping apps that cost the company money
  • Utilizing only some of an app’s features
  • Using apps that don’t enable collaboration or foster productivity

Mitigating SaaS Risks

The plethora of SaaS applications can present risks as your company scales. Fortunately, you can mitigate SaaS risk using the following methods:

  • Create a SaaS app visibility strategy
  • Understand contractual obligations to SaaS vendors
  • Gain insight into the employee experience
  • Align your app strategy with your business strategy
  • Build a roadmap for application adoption

Create a SaaS App Visibility Strategy

Addressing governance issues requires a clear strategy to gain visibility into your SaaS application portfolio. How do you create such a strategy, though?

You could manually track SaaS applications and platforms manually – our research shows that 56% of IT executives still rely on those methods to gain visibility into their apps.

However, it’s difficult to track apps manually. Someone has to be in charge of updating them when more licenses are added, or when new apps are added. Additionally, manual data entry methods have an average error rate of 1%, so you can assume that this type of tracking is never completely accurate.

Choosing the Right Tools to Gain Visibility into SaaS Apps

Automating the SaaS app visibility process will significantly reduce errors in tracking this software. Today, there are SaaS app management solutions on the market that allow you to track your SaaS subscriptions effectively and accurately.

That being said, not all SaaS management software is created equally.

For your SaaS app visibility strategy to be successful, you need to choose a solution that doesn’t just track the number of licenses you have, or which apps you use. It needs to give you a deeper understanding of how apps are being used. We’ll explore what this means in the following sections.

 

Understand Your Contractual Obligations with to SaaS Vendors

When you think of contractual obligations to your SaaS vendors, the first thing that likely comes to mind is cost. However, there may actually be a second contractual obligation: usage.

It’s possible that only a certain number of users can utilize the app at a given time under the limitations of your contract. Or, perhaps you receive certain features as part of the contract, even if you’re not using them.

“There’s a second contractual obligation aside from cost: usage.”

This is where choosing the right tools for SaaS visibility comes into play. Productiv provides you with greater visibility into your SaaS applications, so you can see whether users are maximizing all of an app or platform’s functionalities, or if they’re using the most basic features. This knowledge is vital when heading into contract renewal negotiations.

Gain Insight into Your Employee Experience

Your technology stack has a significant impact on your employee experience. If employees can’t collaborate effectively, they feel disengaged and unmotivated.

Research from Forrester published in March 2020 shows that employees in the lowest half of the analyst firm’s employee engagement index were most likely to be dissatisfied with their employer’s technology stack.

Partnering with a line-of-business manager who understands what apps and platforms employees are using is crucial. This partnership gives you deeper insight into how employees feel about the SaaS apps they use because if you’re not giving employees what they want, they’ll have a poor experience.

However, this doesn’t erase the need for a SaaS visibility tool – in fact, far from it. With the right SaaS app visibility solution, you have hard data that demonstrates how employees are engaging with an app or platform, and whether they’re getting the most value out of all of an app’s features.

Align Your App Strategy with Your Business Strategy

To mitigate SaaS risks, you must align your app strategy with your business strategy. That can be challenging when your company has grown, and you might not be aware of all the apps and platforms in use at your firm.

This is where gaining greater visibility into your SaaS apps and platforms comes in. When you understand what apps and platforms your company is using, you can determine which apps fit into your overall strategy, and which apps aren’t helping you move forward.

When formulating an app strategy, you will need to answer the following two questions:

  • How do you determine which SaaS apps your company really needs?
  • Which SaaS apps are the best fit for your business strategy?

The apps will depend partially on your business and industry. If you’re in financial services, you’ll need related apps. However, there are some apps that are fairly universal; apps that enable employees to communicate and collaborate create value for businesses. It’s also important to remember that apps must be compliant with whatever regulations by which you’re bound.

Build a Roadmap to Application Adoption

The final step to mitigating Saas risks is building a roadmap to application adoption. A roadmap acts as a timeline for the app rollout. Timelines set realistic expectations – employees understand when they’ll be able to use an app.

Creating a roadmap is also useful because it cultivates a partnership between the IT department and line-of-business departments. You’re demonstrating that you want to make the workforce productive and effective while also weighing critical principles such as security and cost.

Productiv Can Help You Mitigate SaaS Risks

Productiv’s SaaS management software gives you visibility into your SaaS application portfolio so you can make better decisions for the entire business. To learn more, request a demo. Better yet – get started with Productiv Essentials, our free SaaS management offering – today.

Announcing Vendor Insights

The power of Productiv is a deep understanding of both your users as well as the applications that they consume in order to drive greater productivity in your organization. Our goal is to give you a real-time, 360-degree view of how your employees truly consume each application, down to the feature, so that you understand how you can drive more value from each application that you invest in.

Much of the work for Procurement and IT teams is hidden from end-users, however. How do you strategically invest in particular vendors? How do you manage those relationships that can grow over time into many applications, consumed differently across different business units? And how do you create leverage from vendor relationships, when the vendor could be a small purpose-built startup or a sprawling set of products from the likes of Microsoft or Google?

That’s why we are releasing Vendor Insights. Vendor insights allow you to roll up information on key applications and look at them – you guessed it – on a vendor by vendor relationship. 

Let’s take a look at Vendor Insights and see how they could help us. We’ll start with the Vendor List.

Here we can see all our vendors, with the number of applications they provide us aggregated into one column. With contract annual spend and actual 12-month spend provided, we can get a full picture of the vendor and its impact on your organization. For example, it’s quite possible to have a vendor with lots of applications but low spend – maybe they offer lots of freemium products for example. We might want to manage that vendor differently than one who has a number of applications and a high spend, Such as Google or Salesforce.

Perhaps we were alerted from the Productiv Renewal Calendar that we have our upcoming annual renewal for Github coming up. While a year ago, that was a separate contract, as Microsoft truly brings Github into its operations it will be treated as part of our overall Microsoft relationship. As such, it makes sense to review everything we’re doing with Microsoft and see if there are ways to further optimize our contractual relationship.

Let’s go one click down on Microsoft and see what’s happening with these Microsoft applications. 

Here we notice a few things – While Github is a large spend item, it’s a far second to Office 365. Also, we see that we’re significantly underspending our contracted Office 365 spend, while we are significantly overspending our contracted GitHub spend. Finally, Azure Active Directory has significant spend, but we don’t have an active contract with Microsoft. 

With a Procurement mindset, we can see that there is room for improvement on all fronts here. Most importantly, can we have a conversation with our IT teams and Microsoft about Office 365, and our go-forward plans? Do we have our spend incorrect, and can we use this Github renewal as a time to modify our terms?

Next,  let’s look at Github itself and see if we’re really getting the value we think we should. Clicking on Github takes us to the application view. While this view isn’t new, it’s been integrated with Vendor Insights so that you can follow the logical pathway from Vendor -> Apps -> Features without disruption.

We can take a look at the recommendations from Productiv on the use of Github itself to see how we can rightsize our deployment on the individual application. In this case, it looks like we’re overprovisioned by about 5%, which could represent an immediate savings to the company at the time of Renewal.

Finally, let’s take a strategic view of GitHub in relation to our renewal. By looking at the feature usage tab, we can see that, while most users are creating PRs and even merging, a minority are creating issues. This is a powerful way to assess whether your engineering team is really getting the most of the tool at hand. IT can use this information to work with the engineering team and the vendor to implement best practices or provide training in partnership with the business unit. We can use this upcoming renewal as a level-set with the Microsoft team: we want to keep using this software, but we expect that you will continue to help us drive greater usage of its functionality.

The Vendor insights functionality is a powerful new way for IT and Procurement to take charge of vendor relationships. By expanding the scope of conversation beyond the renewal at hand or adoption of a single product, IT teams can drive a more strategic relationship with software vendors. This in turn can lead to greater productivity for your teams while more effectively managing spend across many applications.

Vendor Insights is available within all tiers of Productiv. If you’re not yet a customer, consider signing up for Productiv Essentials, our entirely free offering that gets you started on your SaaS Management journey today.

Customer Success Chronicles: Productiv + Conga

I’ve had the pleasure of working with Conga over the past eight months as they’ve transitioned from their manual spreadsheet to Productiv for SaaS management. I’ve worked closely with Vinitha Jeevarathnam, IT Senior Program Manager, in on-boarding and training at Conga and recently caught up with her to share her perspective on modern SaaS management.

What’s your role at Conga?

There are a lot of facets to my role, I lead Vendor Management Operations and Procurement Management Operations, this includes setting standards and processes for projects such as app roll-outs, and responsible for maintaining our enterprise application portfolio.

What was the problem you were facing?

Before Productiv, we used a sprawling spreadsheet with 30 columns and around 200 rows to organize IT applications. It was very time-consuming to maintain, train different stakeholders, and we occasionally experienced data errors.

In particular, one recent app auto-renewal surprised us – $10K in cost which could be completely avoided. Our CIO, Praniti Lakhwara, is data-driven and it was apparent our current process was not scaling. With our growing portfolio we decided we needed a centralized platform to empower IT in managing renewals, collaborate with finance, and to build a scalable process. 

What made this a challenging, yet critical, problem to solve?

SaaS portfolio information is spread across diverse systems – to fully analyze an application I needed to pull data or request data from 4-6 sources, NetSuite, Expensify, Admin dashboard, and SSO just to name a few. Additionally, we had no systematic way of monitoring Shadow IT, tracking apps being organically adopted and apps that might be redundant to our current portfolio.

How is Productiv helping solve this problem?

Productiv quickly helped us achieve our primary goal of app portfolio visibility. We have not only replaced the enterprise application spreadsheet but gone beyond it with additional capabilities from Productiv, some of the major benefits are:

  • Renewal management to ensuring we are fully prepared for vendor management and renewal conversations. We saved 30% on a recent renewal for esignatures. 
  • Calls to action – Productiv provides alerts on tool adoption, unusual spend, rightsizing opportunities. Previously, after-the-fact renewals were a big problem, we lose any negotiation leverage once a renewal goes past renewal date. Happy to say this doesn’t happen any more – problem solved. Period.
  • Productiv surfaces the full app story by showing engagement and login data, something we didn’t track previously. Helped us drive migration.

What are you looking forward to with Productiv?

The SaaS spreadsheet was pretty basic and so we were unable to do portfolio-wide analysis such as app redundancy. Additionally we didn’t have any information on logins or engagement without manual data pulls that quickly became outdated. With the replacement of the spreadsheet, I’ve reclaimed 2-3 hours each week which I can use for more thorough analysis.

I’m looking forward to fully leveraging the application comparison feature, which will help us go  from reactively managing renewals to proactively shaping our app portfolio. 

App admins are always concerned whether their customers – Conga employees – have the right tool and license to best perform their job. Productiv’s automated license management workflows easily help save money and avoid the manual tasks of license management. 

How to Manage and Optimize Application Ownership

Any software as a service investment shares two common characteristics: you have a problem to solve and you want to find a solution to solve it. If you’re the one making the purchase, you become the application owner. This process is repeated ad nauseam throughout the organization with multiple apps and application owners.

In theory, this approach makes sense. Any expenditures on apps should directly correspond with the value the app brings to your business. Therefore, your apps are believed to bring value because of the problems they were chosen to solve.

In reality, the growing conglomeration of apps within an organization can lead to confusion, underutilization, and overpayment. This is especially true in our current landscape of remote work, where new apps have been brought in to facilitate a quick transition without the typical exploration process. When this happens, the apps you’re paying for start reducing the value they were intended to create.

One approach to prevent app value attrition is to gain a stronghold on application ownership. By gaining a deeper understanding of what apps are being purchased and by whom, why apps are purchased, and how they’re used, IT departments can provide better support to users and maximize the value of software investments across the organization.

Why Companies Need an Organized Approach to App Management

Historically, IT departments are tasked with bringing an organization’s apps and technology under their umbrella. But with the growth of software as a service, many app investments have left IT out of the conversation.

This is because department leaders and employees can easily sign up for free apps or trials or use company credit cards while bypassing IT altogether. What’s more, since SaaS apps are now in the cloud, IT’s role in app deployment and setup has drastically been reduced.

As a result, application ownership becomes disparate. No longer does IT assume the role of app owner for all software tools. This poses several challenges for IT and the organization as a whole:

  • IT no longer has a firm grasp on all of the tools technologies being used by the organization. This lack of insight can lead to complexities in network security and could leave users vulnerable.
  • As app owners leave the company or move to different departments, the apps they purchased are still in play but have no owner. This often leads to paying for apps that are no longer needed or being used.

IT management processes have not caught up to this shared responsibility of technology, which has created a multi-faceted problem. Even though IT isn’t purchasing all the apps in the organization, they’re still left holding the bag when it comes to scalability and integration with other apps and workflows. They’re also the go-to resource for troubleshooting when something goes wrong. Too often, IT teams see apps for the very first time when they’re being called upon to troubleshoot.

App ownership matters to facilitate the process of IT being as strategic as possible, regardless of who initially owns the app. Without the benefit of a bird’s eye view into app usage and spending, organizations are susceptible to having duplicate applications, orphaned subscriptions, and overall decreasing value.

The Benefits of Optimizing Application Ownership

An effective way to maintain app value while decreasing the negative side effects of a growing app portfolio is to centrally manage the portfolio. This allows owners to maintain application ownership while also creating a more supportive structure for software investments throughout the organization.

Here are some of the benefits that come with improving app ownership optimization using Productiv’s SaaS management platform:

Build a Stronger IT Department

IT’s functions have evolved with technology. No longer tasked with just network security, computer setup, and systems maintenance, IT is also taking on more of a consulting role when it comes to software expenditures. This is partly because whatever software tools a company invests in, users will look to IT when something goes wrong and they need support.

Another increasing role of IT is to be part of budgeting conversations and help companies strategically invest in software tools. This often includes negotiating enterprise-wide licensing with vendors and thinking about long-term scalability as the company grows.

Centralizing app ownership management with Productiv can empower IT to continue making these mission-critical decisions. Productiv helps IT visualize and understand how apps are used and how often they’re being used. With this intel, IT can have more meaningful conversations with app owners to maximize the value of each investment.

Drive Meaningful App Engagement

One of Productiv’s most notable features is the ability to dial in on how specific apps are being used. Once you develop your app portfolio, IT admins can visually see the ROI delivered by each app based on user adoption, engagement, and collaboration patterns.

IT teams can see how users or teams are adopting specific apps or features. These patterns may also reveal the need to provide user training and onboarding to increase adoption and usage. By increasing engagement, organizations are better positioned to get more value out of their existing applications.

Reduce SaaS Spending

The deeper level of insights into engagement, usage, and collaboration serve to justify app spending and license sizes. Before new apps are brought on board, IT can see whether they’re fully utilizing the apps they already have (and are already paying for). It could be that a new solution isn’t needed, but rather more licenses are needed for an existing solution.

It also allows IT to identify apps that could be eliminated from the portfolio altogether. Apps that no longer have active owners, features that overlap with other apps or apps that haven’t been used in months or years can free up financial resources that can be put toward increasing licenses for better tools.

Boost Productivity

When extraneous apps and clutter are removed and users are properly integrated with the right apps, an increase in productivity becomes a natural byproduct.

With Productiv’s visual data storytelling, IT teams can gain this insight into app usage per employee to identify redundancies that could be killing their productivity. This way, employees have only the tools they need to do their job and can avoid app fatigue.

How Productiv Simplifies Application Ownership Optimization

Managing app ownership is one of many tasks that IT teams grapple with on a daily basis. The shift to remote work has only complicated this challenge as teams are scrambling to facilitate new processes and are turning to SaaS tools to do it.

Productiv’s centralized management platform helps you organize application ownership by providing a bird’s eye view into your entire app portfolio. Start SaaS Management for Free with Productiv Essentials to see how we’re helping IT teams stay proactive and productive in managing your app stack.