6 SaaS Challenges That High-Growth Companies Face


Vendr | Solve your SaaS challenges
Written by
Ariel Diaz
Published on
June 9, 2021
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Managing IT in the era of SaaS software proliferation can be difficult, especially since the command-and-control model of old no longer works for most companies.

A Collaborative IT approach, in contrast, involves team leaders, employees, finance, HR, and IT in collectively solving SaaS management challenges.

Collaborative IT is when business leaders and individual team members can choose the tools that work best for them while:

  • Staying within budget
  • Meeting security and compliance goals
  • Maintaining visibility into app usage and spending
  • Offering oversight to leaders and stakeholders who need it

The Collaborative IT approach can help mitigate many SaaS challenges, including the handful below.

SaaS Challenges and How to Address Them

Here are six SaaS management challenges commonly faced by high-growth companies (from startups to SaaS businesses), and how Collaborative IT can help.

1. A Loss of Visibility with Rapid Growth

In the early stages of a company, it’s relatively easy to see SaaS usage and spend across the organization. However, once an organization enters the “growth stage,” it tends to become inherently less sensitive to cost.

In many cases, this is a point in the business’s maturity when leaders are willing to do “whatever it takes” to drive aggressive growth goals around revenue, user acquisition, or other benchmarks. Visibility fades as scalability grows, and spending on SaaS solutions can grow exponentially without any real strategy behind (or control of) why or how.

How to Address With Collaborative IT

When your business begins to grow aggressively, introduce a SaaS subscription management system that provides visibility into app spend and usage.

With SaaS growth today, this process is too much to track via a spreadsheet and should be monitored in an automatic and continuous fashion. This allows team members flexibility while still providing transparency into app use and other metrics.

2. Wasted Spend

At many young companies, SaaS spending runs rampant until a finance hire is made or someone at the executive or management level discovers a trend of inefficiency.

This can look like overlapping subscriptions, paying for more features than are being used, or buying apps before they are truly necessary (because the process of purchasing in real-time may have bottlenecks).

How to Address With Collaborative IT

When the SaaS budget starts to get out of control, an honest evaluation of SaaS usage relative to need is required to maintain a healthy bottom line.

In addition, SaaS vendor contracts and licenses should be reviewed regularly to ensure there is no overlap and waste.

3. Lack of Clear Employee Onboarding and Offboarding Processes

Most employee onboarding and offboarding are done on an ad hoc basis today, even at larger, more established organizations.

What does this look like? Employees request access to services or credentials when they need them, rather than receiving all of the appropriate onboarding materials up-front. You can imagine how much this slows down productivity — for both new employees and HR teams who have to field these requests.

On the other end, the lack of a clear employee offboarding process increases an organization’s risk of a costly insider threat. What’s more, onboarding and offboarding responsibilities might not even be assigned to a specific person or department, resulting in insufficient accountability and process ownership.

How to Address With Collaborative IT

Employee onboarding and offboarding should be a formalized workflow, regardless of the size of your company. Work with IT and HR to come up with lists of tasks that should take place every time a team member joins or leaves your company.

A centralized SaaS management platform can help mitigate many of the biggest challenges with SaaS to help decrease risk and increase employee productivity.

4. A Reactive Approach to Security

Often, it’s not until a real-world security incident takes place that teams realize they need to actively decrease risk. Both ad hoc and nonexistent security policies can open organizations up to a whole world of vulnerabilities.

On the other side of the spectrum, some organizations employ arcane security practices (like forcing users to change their passwords at regular intervals for no real reason) that are not user-friendly and are thus often neglected by employees.

How to Address With Collaborative IT

As much as possible, security should be automated. You should put guardrails in place that make it very difficult for employees to make mistakes or engage in risky behavior — intentional or not.

This includes enforcing secure authentication and the principle of least privilege across all SaaS applications, in addition to the secure onboarding and offboarding practices we outlined above.

5. Customer-Driven Compliance

When organizations sell to large enterprises or businesses within highly regulated industries, they need to complete a compliance audit such as SOC 2 or adhere to privacy regulations like GDPR.

This can require a complete overhaul of how IT is handled, and it’s often a hassle to do it on a dime, which means either paying extensively for outside help or losing out on the business.

How to Address With Collaborative IT

As soon as you identify prospects that are likely to have major compliance requirements, evaluate which compliance mandates you need to meet and budget (both financially and time-wise) to meet those mandates.

If you approach this proactively, it can minimize disruption to your business and increase your odds of winning new customers. As far as how to check all those compliance boxes, implementing a SaaS management platform can help you verify that you are meeting requirements, provide proof to regulatory bodies and auditors, and ensure that controls are upheld continuously.

6. Ineffective or Redundant Apps

Sometimes, teams wind up using multiple paid apps with overlapping functionality. In other cases, teams are using both free, unsanctioned apps and paid, sanctioned apps that accomplish the exact same purpose. For example, a sales manager may purchase on-premise video conferencing or CRM software while the individual reps already use free cloud applications because they’re easier or better.

In some cases, paid SaaS products can be eliminated altogether in favor of free ones, allowing budget to be reallocated elsewhere.

How to Address With Collaborative IT

When a successful Collaborative IT program is implemented, it results in teams choosing the apps they truly want and need, while IT and finance have oversight into what is in use.

To successfully structure a program like this, plan a quarterly review meeting where team leaders walk through which apps are being used and what team members have to say about them.

Look at functionality in use to ensure that there is not significant feature overlap, and determine if there are areas where the fat can be trimmed, either by cutting tools or downgrading features to decrease redundancy.

Ariel Diaz
Chief Strategy Officer
Ariel is Vendr's co-founder and chief strategy officer. He is the former co-founder and CEO of Blissfully.

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