Most businesses rely on a wide range of software products to manage their processes. While software can make every facet of your operation easier and more efficient, it can also become a money pit that is out of sight and out of mind.
Many businesses suffer losses every month and focus first on increasing revenue and cutting expenses, but never look at the thousands spent on software as a service (SaaS) subscriptions that are redundant or completely unused. Add in the stress of granting and revoking access to employees, onboarding, adopting new software services, and keeping your business secure—you need SaaS management.
What is SaaS management?
SaaS management is keeping track of each and every software, cloud, and/or licensing subscription services, including how much you pay, when they expire, who uses them, how they’re used, and where they fit into your business process.
Your SaaS subscriptions are billed monthly or annually (or some software platforms are free). Some subscriptions are a single fee for an organization, while others are paid per user. Different functions apply to specialized positions, and some may provide access to sensitive data and finances that need to be limited and quickly revoked when employees leave.
Managing your SaaS apps could mean keeping track of a huge number of standalone products, or trying to integrate multiple products, to keep your business running smoothly and efficiently. SaaS management is often split between many stakeholders, such as a sales team using Salesforce, but it’s being managed by the executive team and paid for by finance.
All this to say—it’s complicated. And SaaS subscription management is critical for utilizing software that fits the needs of your business without overpaying or compromising on efficiency or security.
Components of SaaS management
Software app subscriptions
How many software subscriptions do you have? Your company needs a master list of all software and cloud subscriptions. It’s easy to track company-wide services, such as Zoom or Slack, but different departments and even individual roles may have their own SaaS business subscriptions. A master list is necessary, because roles change and employees may come and go, all while a service is charging you monthly because no one knows to cancel.
In addition to a master list, some important information you’ll need is the licensing agreement. Do you need an individual license for each user or is pricing based on a tier of active users? When do your licenses expire? Do they auto-renew? You may also need to consider different versions of the product, such as free, premium, and add-on features.
SaaS vendors are nearly unlimited. You may find that consolidating your services with a vendor that offers multiple features can decrease cost and confusion. Alternately, you may find that a few different free services could replace a single costly subscription. Stay up-to-date on your vendors and new providers.
What legal contracts are you signing before using the product? How is your data used and protected? What happens in the event of a breach? Software might be important to your business functioning, but some services also interact with your client data. You need to understand how your SaaS vendors are managing security and privacy compliance.
Who is in charge of software subscriptions? Who has access to the master list and related data? From which budgets are subscriptions being paid? It is in the best interests of your business to have one person designated to manage subscriptions, but for access to be available for others as needs change.
It’s not likely that every single employee needs access to every single software service. For example, only marketing needs access to Marketo (and maybe only one or two people in marketing). You don’t want to pay for extra licenses that are unnecessary or unused. Determine which roles need which services, and what level of access within a service, then create workflows to provide appropriate access.
Inevitably it will fall to your IT department to incorporate, integrate, train, and troubleshoot when it comes to SaaS subscriptions. Proper SaaS management accounts for the processes IT will need to utilize and implement software within the company.
Challenges in SaaS subscription management
Companies who rely on multiple points of SaaS (which is everyone in 2020) are going to face challenges when it comes to managing their software use, from setting up recurring billing to understanding the revenue impacts of subscription software. We’ve identified a handful of sticking points that you might encounter when it comes to your software subscription management.
As needs arise, technology zeroes in to meet those needs. As a result, new software is introduced almost daily that can meet even the smallest need in your process. The list of potentially useful SaaS adoptions is ever-growing, and each new addition isn’t guaranteed to play nicely with your existing software. The process can become more fragmented and less productive as you add in new services.
Unfortunately there is no standard for security in software services at the current time. This means that some applications use multi-factor authentication or track unusual usage, but others may not. The more SaaS subscriptions you introduce, the higher the risk of compromised data, stolen passwords, and cyber attacks.
Each department can find its own specialized tools, but not everyone will know and understand the need for each SaaS tool. Furthermore, the constant introduction of new SaaS products can splinter information and processes across old and new systems.
Video conferencing may be available through your email suite, but you may prefer the features of another service. You may prefer a partial feature from one service, but reject the other included features in favor of another service entirely. This can create chaos, paying for more than you need, and fatigue.
Certainly there is the cost of each SaaS subscription, but you also need to understand the cost to your organization when you hire a new engineer versus a new sales manager. Certain roles will mean a higher cost in software access licenses and the more your company grows, the greater the need for subscription management software to manage the recurring billing for all of those tools.
Often the responsible party for subscription billing is not the stakeholder using the SaaS application. Recurring subscription billing means that your finance team could be paying for a subscription you thought you cancelled, or that the service upgraded to an expensive plan without notice. How will you know if a SaaS vendor is compromised and your corporate card data has been exposed? Paying for SaaS subscriptions can get messy.
Improving your SaaS subscription management
Whether you manage 20 or 200 SaaS subscriptions, it’s critical that you audit your subscriptions today. Far too many companies find that they know little or nothing about the costs and challenges of their software use, even while software subscriptions are draining bank accounts and productivity. You may consider subscription management programs such as ChargeBee, Blissfully, Symantec, or Zoho, but that’s yet another service. Here’s how you can take control of your SaaS subscriptions right now, so they don’t control you.
Manage subscription payments
No more setting your SaaS subscriptions on the company credit card on autopay. You can lose thousands (if not millions) when subscriptions auto-pay and auto-renew, especially if you’re paying for more users than are actually using the product. Set up your recurring billing for your SaaS subscriptions on a virtual card that keep tabs on the expected payment total. Set reminders for recurring payments, price increases, or tier upgrades so you don’t bleed money you’re not expecting.
It is critical to keep a master list of all subscriptions and vendors. However, the list alone doesn’t do much. Improve your SaaS management by tracking exactly what each service offers, and how many people in your organization are using it. You might be surprised at how much you’re paying for a service that no one uses, or that upgrading an existing vendor account could allow you to drop other services for added convenience. As the time for renewal approaches, determine if you’d like to renew or try another service—and allow teams adequate time to replace the software.
Part of your vendor management will include tracking use and cost. With that data you can begin to assess the return on investment. Essentially, you can manage your SaaS applications by deducing which services give you the biggest bang for your buck. Stop paying for expensive programs that provide little reward, and instead invest in the software that truly pays you back in increased productivity and returned time.
Carefully select software services that allow for secure use and user tracking. In the event of a security breach, you’ll need to find data for auditing and repair purposes. Limit access to SaaS and sensitive data only to employees on a need-to-use basis, and monitor regularly for weaknesses or misuse.
Onboard & offboard better
Automating the onboarding process with detailed instructions and tutorials can minimize human error and delay. Proper offboarding is even more critical. As the need to offboard employees arises, you’ll need a comprehensive list of the services used by the individual so that access can be immediately and effectively removed to protect the company and decrease extra expense. Create a workflow that allows for speedy offboarding without confusion or delay.
Divvy makes SaaS subscriptions safer
We can’t tell you every SaaS solution your business needs, but we can offer you greater control and visibility into your SaaS spending. Divvy makes your subscription management a breeze through a few key features:
- Virtual cards can be generated for each vendor, isolating fraud opportunities
- SaaS applications can be nested into budgets, so you know exactly who is paying for what and where the money is coming from
- Budgets allow you to set a total for the month (or year) that cannot be exceeded, so subscription services can never overcharge
- Set an expiration on the virtual card and budget, so auto-renewals can’t fly under the radar
- Total visibility allows you to see software billing immediately
Don’t let your software subscriptions inch their way into your budgets with uncontrolled spend. Manage your SaaS with these tips for a more effective and efficient modern business.
Divvy provides free expense management, virtual cards, enforceable budgets, and subscription management that works. Take a demo of Divvy to see what we can do for your business.