What is SaaS Asset Management? Full Guide + Best SaaS Management Tools

Key takeaways: 

• Keeping track of SaaS purchases has become a headache, and only proper SaaS management practices can control the rise of shadow IT and its associated risks.
• SaaS management helps discover, organize, and streamline SaaS applications used across an organization. The visibility it sheds on the SaaS stack helps weed out unnecessary SaaS apps and optimize spend.
• Organizations need SaaS management to address lack of visibility and control, ineffective SaaS license management, and improper spend management. 

The democratization of purchasing power has increased the need for SaaS management. Since anyone with a company credit card can purchase a SaaS solution, it gets harder and harder to keep track of SaaS applications that are in use. 

There’s no way to identify whether the acquisition of a SaaS application was through the procurement process or shadow IT. Shadow IT is the process of making purchases outside the company's pre-defined procurement policy. 

To prevent instances of dark purchasing and its associated security risks, organizations need to implement proper SaaS management practices. If you’re looking for ways to implement a SaaS management process in your organization without putting a damper on the spirit of your functional managers, you’re in the right place. 

This blog will cover everything you need to know about SaaS management, including what it is, why it’s important, and some tips and best practices for effective SaaS management.

What is SaaS management?

SaaS management is the process of streamlining the decentralized and unmanaged SaaS usage in an organization. In addition to shedding much-needed light on SaaS portfolios spread across business units, SaaS management helps optimize SaaS usage and weed out unnecessary SaaS apps. 

Also known as SaaS operations management, it empowers the procurement team and the IT team to perform an array of tasks, including managing application licensing, controlling SaaS spending, streamlining SaaS subscriptions, enforcing procurement policy adherence, and automating existing IT workflows and processes.

The impending need for SaaS management

As the rate of SaaS adoption continues to increase every day, it’s critical to streamline and segregate SaaS applications. An ideal SaaS management lifecycle helps procurement and IT department heads identify overlap, mitigate security issues, optimize SaaS costs, and simplify SaaS renewals. 

Listed below are three reasons why every organization needs a rock-solid SaaS management process. 

1. Lack of visibility and control

As shadow IT continues to gain popularity among end-users, nearly 40% of SaaS purchases occur without the IT team's permission. What's more, the end-users who purchase SaaS applications on a whim don't perform the necessary due diligence, as they’re focused on solving their real-time problems immediately.

Procurement and IT leaders need to have full visibility into the SaaS ecosystem to know which applications are yielding a good return on investment (ROI), and which applications business units can survive without. 

End-users may use API integrations to exchange data with your existing software stack (like Salesforce, QuickBooks, and more). If the application they use isn’t thoroughly vetted for data security, they may end up exposing your organization's confidential data and paving the way for cybersecurity risks.

2. Ineffective SaaS license management

With SaaS sprawl on the rise, the chances of mismanaged SaaS licenses increase with it. When not all SaaS purchasers in an organization undergo proper software asset management training, they increase the risks of underutilized licensing.

Poor licensing management poses a ton of risks for the business. For instance, when software licenses aren’t managed correctly, proper employee offboarding may not happen. There are chances that a former employee could still have access to one or more of your SaaS apps, exposing your organization's confidential information. 

Unused licenses, on the other hand, pose a different type of problem. Some end-users purchase more licenses than necessary to accommodate the needs of their growing team and future colleagues. However, most SaaS applications offer a pay-as-you-use pricing model, which helps administrators to add users if and when required. Unused licenses just eat away at a department's budget without offering any benefits. 

3. Improper spend management

When it comes to buying organization-wide applications like Microsoft Office, G-Suite, or Dropbox, the IT team can spearhead the provisioning and control the spend effectively. However, the procurement team and the IT team may not know of the existing niche SaaS needs in various departments. If there’s no SaaS management plan in place, the buying frenzy of end-users results in unchecked SaaS spends.

Usually, every organization allocates a budget to individual departments when it comes to IT asset purchases. However, when SaaS purchases are made without proper approvals, there’s no way to track spend except by going through each individual's credit card statement, which is easier said than done. 

Some culprits for overspending in SaaS are:

• Signing up for a free trial with a credit card and forgetting to cancel the subscription after the trial is over.
• Investing in SaaS applications that accomplish the same thing. For example, while Microsoft Planner is the preferred project management tool, teams may choose to use Trello or Notion just because they’re easy to use.
• Purchasing SaaS apps for one-time use. The sales team may end up investing in a webinar tool just to hold one webinar every year.

SaaS management best practices

If you’re facing troubles with SaaS management, then you’re not alone. Today, it’s the most common problem that small businesses and enterprises face. However, these four best practices to track and manage SaaS spends can help you win the battle against unmanaged SaaS stacks.

1. Identify the existence of SaaS apps

You don't have to invest in an elaborate IT asset management solution to identify SaaS applications used across your organization. All you need to get started is a simple SaaS stack template. Rather than doing a complete overhaul of the purchasing process, start with simple steps.

You can start by collecting information on the top five tools each department uses. Send a survey to functional department heads or employees with a business credit card requesting information on the SaaS apps they subscribe to.

Once you get the initial information about SaaS applications, dig in a bit deeper and request more information. Collect pertinent data like subscription fees, renewal dates, number of licenses, and more. You can always cross-check this information with their business credit card statements.

2. Understand SaaS usage data

Before you get your shears ready to trim SaaS spend, you need to understand the utilization levels of existing SaaS applications. Now that you have your list of SaaS applications, send individual surveys to users to identify how often they use a particular SaaS app and how it impacts their work and productivity.

Some of your colleagues may have used a particular application only during the onboarding phase, and then forgot all about its existence. This survey can remind them about their unused license and help them decide whether or not they still need access to that specific tool.

3. Discover redundancies and overlaps

Armed with the master list of SaaS applications used across the organization and insider information on SaaS usage levels, you can step into the process of identifying overlaps and redundancies. To do this, you’ll need to perform an exhaustive analysis of each application and its potential use cases.

Two of your teams may end up using two completely different tools to fulfill the same use case. To resolve such overlaps, analyze and find out which is the best among those two tools, or if there’s a third best option available. Then talk to all stakeholders, present them with your findings, and convince them to make a switch.

4. Trim down unnecessary SaaS spend

Instead of outright removing licenses of SaaS applications, try finding opportunities where you can redistribute the same licenses to other employees. Sometimes, end-users may subscribe to premium plans when they can meet their needs with a free plan. Find such instances, and downgrade the plan. 

However, before you do this, check SaaS agreements for early termination penalties. Planning ahead for SaaS renewal management can give you control over your SaaS spend and help negotiate SaaS contracts to get a better deal.

3 best SaaS management platforms

1. Vendr

Use case

Vendr is best for companies looking to leverage data to lower SaaS spend and optimize cost savings. As a SaaS management solution, it analyzes SaaS usage and finds pockets of savings for you—enabling you to renegotiate your contracts and only pay for what you use. 

Especially with a growing tech stack, Vendr acts as your right-hand man by ensuring you’re sourcing your SaaS strategically, opting for better pricing model structures, and staying compliant. Best of all, it does this without IT teams having to spend time on the phone with vendors. 

Top features

• Rule-based workflows
• Finance budget signoff tools
• Strategic SaaS sourcing

2. BetterCloud

As a SaaS management platform, BetterCloud sets out to level up your team’s operational efficiency with a series of features that enhance data protection. Features like sensitive data discovery, risky application mitigation, and least privilege access ensure you’re staying on top of possible security threats. 

Use case

BetterCloud works best for IT teams in SMBs and enterprise organizations. 

Top features

• Built to create no-code automated workflows
• Employee offboarding tools
• Identifies and consolidates apps with app discovery
• Granular access control and policies

3. Torii

Torii is built to help you manage your SaaS applications, all while driving costs down. It also helps automate the user onboarding and offboarding process, which can be painstaking and vulnerable to security issues if not done correctly. 

As a SaaS management solution, Torii doesn’t pull any punches and combines easy-to-use simplicity with key SaaS management features so you stay on top of your software stack. 

Use case

Torii is perfect for IT teams across various industries looking to manage their SaaS budget with added efficiency. 

Top features

• App discovery tools to minimize shadow IT
• SaaS spend optimization features
• SaaS renewal and vendor management
• Plug and play integrations
  

How does a SaaS management platform like Vendr help?

Vendr covers every SaaS management use case, including:

• business operations
• employee onboarding and offboarding
• SaaS spend optimization
• SaaS security and compliance

It does this through both its ‘system of record’ and its Workflows and Automations. In other words, it simplifies your entire SaaS portfolio with its right-size pricing.

SaaS operations

Vendr comes furnished with a library of workflows and automations that collaboratively manage, control, and track SaaS tools across the entire organization. You can also create and save custom workflows to run again and again. Build and maintain processes that work, and streamline your SaaS ops.

Employee onboarding and offboarding

Vendr helps automate and scale the onboarding and offboarding process in a few ways.

Our workflow engine provides you with workflows and automations to ensure that your process is structured and scalable, with clear tasks for everyone involved.

SaaS spend optimization

Vendr rigorously tracks software spending and usage data to make sure you're maximizing your ROI.

SaaS security and compliance

Vendr logs all permissions and authentications, as well as key compliance data.

System of record

Vendr's ’system of record’ is a real-time, single source of truth for an organization. Its software asset management (SAM) feature—like IT asset management (ITAM) but for software—gathers data from across the organization, integrating with your G Suite, SSO, HRIS, workforce management systems, finance systems, and other software tools. The integration generates a complete report on all software used, including spend data, compliance status, billing owner, vendor, and more, giving you full visibility.

Vendr helps teams optimize SaaS spending by accurately tracking and reporting SaaS costs across all teams and apps. It enables organizations to eliminate overlap and waste while ensuring better forecasting. With Vendr, you will be alerted to upcoming renewals, so you are never surprised by a bill.

Workflows and automations

Managing SaaS isn't merely being able to see the data; it's also being able to make changes to the system in a sane, structured way. Vendr's workflow engine gives your organization that capability by allowing you to use our premade workflow gallery.

Automations assign those tasks to individuals and teams based on how your organization defines them.

Vendr empowers you to go from ad-hoc, wasteful SaaS sprawl to a streamlined and cost-effective strategy that enables your organization to get the most out of its investment in SaaS.

SaaS management FAQs

Choosing the right SaaS management strategy is crucial for optimizing your software investments and streamlining operations. 

Whether you’re just starting to explore SaaS management or looking to refine your approach, these FAQs address some of the most common and niche queries to help you make informed decisions.

What is SaaS operations management?

SaaS operations management involves the administration, optimization, and governance of software as a service (SaaS) applications within an organization. It encompasses managing licenses, ensuring compliance, optimizing usage, and overseeing renewals and vendor relationships. Effective SaaS operations management aims to maximize the value of SaaS investments while minimizing risks and costs.

How do SMPs and CASBs differ?

SaaS management platforms (SMPs) and cloud access security brokers (CASBs) serve distinct but complementary purposes. 

SMPs focus on the lifecycle management of SaaS applications, providing visibility, cost optimization, and vendor management. 

CASBs, on the other hand, enhance security by monitoring and controlling cloud service access, enforcing security policies, and protecting sensitive data. 

While SMPs optimize SaaS usage and expenditures, CASBs ensure the security and compliance of cloud services.

What are some key features to look for in a SaaS management provider?

When selecting a SaaS management provider, consider the following key features:

• Comprehensive visibility. A centralized dashboard to monitor and manage all SaaS applications.
• Cost optimization tools. Features that identify unused licenses, redundant applications, and opportunities for cost savings.
• Automated renewal management. Alerts and tools to manage renewal dates and avoid unwanted auto-renewals.
• Vendor management. Capabilities to streamline vendor negotiations and manage contracts effectively.
• Security and compliance. Tools to ensure that all SaaS applications comply with industry standards and security protocols.
• Usage analytics. Insights into application usage patterns to optimize and justify SaaS investments.

By focusing on these critical areas, you can select a provider that supports efficient, secure, and cost-effective SaaS management.