5 Critical License Compliance Issues in Your Company | Binadox - SaaS management

5 Critical License Compliance Issues in Your Company

Stanislaw Lee

As more companies is increasingly moving towards SaaS applications, IT and procurement teams believe that license management problems will disappear with an adoption of cloud-based services. There’s a common misconception, that organizations are not responsible for license compliance since a vendor controls access to an application.

Unfortunately, your licensing challenges will not go away. Additionally, you will face a totally different set of issues. Beyond that, there are great chances that your SaaS vendors have access to sensitive data of your company. The following discloses the most critical license compliance issues in the SaaS era as well as their solution.


1. Limited Visibility

Without a doubt, SaaS is beneficial in many ways for big and small organizations alike. SaaS applications bring flexibility and boosts productivity across companies. Nowadays, anyone can buy and start using these apps. However, this is the exact reason why SaaS limits your visibility.

Today, employees deploy an app and just “click through” any license agreement without checking with IT department. This way, many companies have a hard time discovering all applications and subscription licenses of their employees. Employees can also access SaaS apps via multiple devices which also complicates license discovery. Companies should consider using a license optimization tool that allows them to discover every single application and manage its license.


2. Cost Forecasting Incapacity

In the days of on-premises technology, software had a predictable pricing and cost structure. Organizations were able to easily forecast future spend and optimize costs. In the SaaS era, forecasting and cost optimization is much more challenging. The pricing model can change and usage is not predictable. On top of that, there are not as many controls over growth or capacity demands. Organizations should concern about making sure their licensing costs are optimized, transparent, and predictable.


3. Audit Complexity

Software vendors are intensively trying to keep up with the increasing movement to cloud and SaaS. Most vendors are introducing complex product use rights governing how their applications can be used in the сloud. Vendors are also adapting to how audits are performed in SaaS environments. It’s company’s obligation to have the documentation required and prove compliance in the new era of SaaS application delivery.


4. Over-provisioning and Multi-tenancy

SaaS vendors usually allow administrators or even regular users to add more subscriptions than are allowed in the contract. Your employees can register a new user without caring or realizing consequences. Thus, your company may over-provision an application and face additional challenges in your attempts to achieve license compliance.

Most applications allows multi-tenancy. This means that several users can access one paid account.  A SaaS vendor can easily track down over-provisioning as well as unsanctioned multi-tenancy of their application. Not only does this strike your budget with an unexpected variance, but it also makes contract renewal negotiations even more challenging.


5. Free Trial Consequences

SaaS apps usually offer free trial to lure in more buyers. Since these apps don’t require any special knowledge or resources to deploy, people dependent on these free offers and their benefits. That’s employees usually don’t wait for IT approvals before deploying new software. Since an application is free, there’s no real reason to object.

However, an employee could get a subscription after a free trial or buy advanced features for a freemium product. Another situation occurs, when a company provides subscriptions for employees, but they might simply forget or not know about it. Your employees might have several unused subscriptions and even don’t acknowledge that. Therefore, your company could very easily be out of compliance.

To achieve license and software compliance you can try to manually control app adoption, set up a policy for app provisioning, or create reminders to manually audit devices. Although, with an automated tool that does all this hard work, your company have much better solution to consider.


Binadox SaaS License Compliance Solution

An automated tool provided by Binadox allows you to discover all your SaaS applications, their usage and licenses. Binadox highlights important legal clauses and compliance problems in your licenses. This way, you will get full visibility all utilized or unutilized applications and can easily ensure compliance of every single license.

This tool also provides cost optimization data and shows exactly how much you can save if a different subscription for underused app is required. Thus, you will regain control over your software budget and will never get hit with audits and penalties.

With just a couple of clicks, you will learn how Binadox facilitates your license optimization and your SaaS management!