How to manage SaaS sprawl

Remember when “software management” meant updating a few core applications and maybe tracking licenses in a spreadsheet? Ah, simpler times. 

Fast forward to today, and your organization is probably using more SaaS applications than you have fingers and toes – each with its own login, its own billing cycle, and its own potential security headache.

The consequences are far-reaching. You’re looking at increased costs from redundant subscriptions and hidden fees. There are significant security risks due to “shadow IT” and unpatched vulnerabilities in unmanaged applications. Compliance issues can arise when you don’t know where sensitive data resides. Then there’s the sheer operational inefficiency from data silos, integration headaches, and employees frustrated by context switching between too many tools.

You’re not alone. The tidal wave of SaaS sprawl is here, and it’s threatening to drown even the most seasoned IT pro.

Let’s walk you through how to identify, assess, and implement strategies to effectively manage SaaS sprawl, bringing order back to your software ecosystem.

The symptoms: How to identify SaaS sprawl in your organization

Think your organization might be suffering from SaaS sprawl? Here are the tell-tale signs:

Financial indicators

• Unexpected subscription renewals: Bills arriving for services you barely remember signing up for.
• Multiple tools for the same function: You’ve got three different project management tools, two video conferencing platforms, and four file-sharing services.
• Rising software expenditure without clear ROI: Your SaaS budget is growing, but you can’t point to proportional gains in efficiency or productivity.

Operational indicators

• Data silos and integration challenges: Information is trapped in different applications, making a unified view impossible.
• Difficulty in tracking software usage: You have no idea who’s using what, or how frequently.
• Employees using unauthorized software (“shadow IT“): Your team is finding workarounds and using tools outside of your approved list, creating unmanaged access points.
• Lack of clear ownership for specific SaaS tools: No one person or department is responsible for managing a particular application.

Security & compliance indicators

• Gaps in security protocols: Unknown access points from unmonitored SaaS apps create vulnerabilities.
• Challenges with data governance and privacy: You can’t confidently say where all your sensitive data is stored or who has access to it.
• Difficulty in auditing software usage for compliance: You can’t easily generate reports on software usage to meet regulatory requirements.

Proactive strategies: Preventing SaaS sprawl before it starts

The best way to manage SaaS sprawl is to prevent it in the first place. Here’s how to build a robust defense:

Centralized software procurement policy

Establish clear guidelines for acquiring new SaaS tools. Designate a central authority (often IT, Procurement, or a dedicated software asset management team) for all approvals. Implement a formal request and review process that requires vetting for security, compliance, integration needs, and existing redundancies.

Comprehensive vendor management

Don’t just buy and forget. Build strong relationships with key vendors. This allows you to negotiate bulk discounts and enterprise agreements, often saving significant money. Regularly review vendor performance and contracts to ensure you’re getting the most value.

Must watch: Want to seriously save at your next renewal? We’ve got just the webinar for you.

Employee education & training

Ignorance isn’t bliss when it comes to SaaS sprawl. Raise awareness about the risks of shadow IT, emphasizing the security and compliance implications. Promote your approved tools and their proper usage, and encourage employees to report new software needs through official channels, rather than signing up on their own.

Budgeting and forecasting

Get granular with your SaaS spending. Allocate specific budgets for SaaS applications and track expenditures meticulously. Forecast future needs based on company growth and strategic initiatives, and implement cost-center tracking for all SaaS expenses to understand where your money is going.

Reactive strategies: Taming existing SaaS sprawl

So you’ve got existing sprawl. It’s time for some aggressive intervention.

To start, you can’t manage what you don’t know you have. Which is why a discovery phase is a crucial starting point. Manually reviewing expense reports, analyzing network traffic, and asking around to other employees is a hunt worth having, but can be a time suck. Automated tools, like SaaS management platforms (SMPs), can automatically discover applications in use across your network.

The goal is to create a comprehensive inventory of the tool’s name, the owner, its cost, purpose, usage analytics, and the renewal date. This foundational step provides the necessary visibility for your team to act on taming sprawl.

Once inventoried, understand how each tool is being used. Tracking not only underutilized applications, but active users versus licensed users for each application.

Leveraging this usage data is what helps make informed renewal decisions. Why pay for 100 licenses when only 20 are actively used?

With a comprehensive inventory and enriched usage data in your hands, you’re ready to make the tough call. Eliminate redundant or unused tools, consolidate similar applications, and optimize licenses by reducing counts or switching to more cost-effective tiers.

Now you’ve got yourself a lean and mean tech stack, but to really prevent SaaS sprawl from happening again, there should be a responsible party who oversees every SaaS application’s usage, cost, and security. Defining clear roles and responsibilities for software management within your organization will be the only way to prevent sprawl from happening again.

Best practices for ongoing SaaS sprawl management

Managing SaaS sprawl isn’t a one-time project; it’s an ongoing commitment.

Regular audits and reviews

Schedule quarterly or semi-annual reviews of all your SaaS applications. Look for newly acquired tools, changing usage patterns, and potential security vulnerabilities. This proactive approach helps catch sprawl before it spirals out of control.

Foster a culture of collaboration

Encourage open communication between departments and IT. Promote the sharing of best practices and successful tool implementations. When everyone understands the benefits of controlled SaaS usage, they’re more likely to participate.

Leverage automation

Wherever possible, automate tasks related to SaaS management. This includes automating onboarding and offboarding for SaaS tools and automating license provisioning and de-provisioning based on employee status. This reduces manual effort and improves accuracy.

Stay informed

The SaaS landscape is constantly evolving. Keep up with new SaaS trends, emerging security threats, and innovative solutions. Continuously evaluate new tools that could offer better value, enhanced functionality, or consolidate existing services.

Implement a SaaS management platform

For larger organizations, an SMP can be a game-changer. These platforms offer:

• Centralized visibility into all your SaaS applications.
• Automated discovery of new tools.
• Cost optimization features, including usage tracking and renewal alerts.
• License management to ensure you’re not over- or under-licensed.
• Security insights to identify potential risks. When choosing an SMP, look for features that align with your specific needs.

Understanding how SMPs save time and money can justify the investment in such platforms.

Successfully managing SaaS sprawl is crucial for controlling costs, bolstering security, and improving overall operational efficiency. It’s an ongoing process that requires vigilance, clear policies, and the right tools. By implementing these strategies, you can gain control of your SaaS ecosystem and ensure your software investments are truly working for you.

Manage SaaS sprawl faster with BetterCloud

Manually battling sprawl is near impossible. It’s why organizations are turning to a comprehensive SaaS management platform like BetterCloud.

Designed to give IT teams full control over their SaaS environment, BetterCloud enables organizations to:

• Automate onboarding and offboarding: Streamline user lifecycle management to ensure timely provisioning and deprovisioning of access.
• Gain full visibility: Discover all SaaS applications in use, including shadow IT, to maintain a comprehensive inventory.
• Optimize SaaS spend: Identify underutilized licenses and redundant applications to reduce costs.
• Enhance security and compliance: BetterCloud helps identify potential security risks and compliance gaps by offering insight into who is using which apps, how, and with what level of access. This visibility is crucial for maintaining data governance and meeting regulatory standards.
• Establish governance frameworks: With BetterCloud, you can set policies for software procurement, usage, and lifecycle management. This reduces the likelihood of shadow IT and ensures consistent application of security and operational protocols across your SaaS ecosystem.
• Enable cross-departmental collaboration: By centralizing SaaS operations, BetterCloud fosters a collaborative environment where IT can work seamlessly with HR, finance, and business units to manage software strategically.

If your organization is battling SaaS sprawl, BetterCloud provides the tools and strategies needed to regain control. From proactive discovery and spend optimization to governance and security, BetterCloud helps streamline your SaaS stack and align it with business goals.

Request a demo today to see how BetterCloud can transform your SaaS management approach.