SaaS Cost Optimization Best Practices
According to BDO, 74% of Tech CFOs say cloud computing will have the most measurable impact on their business in 2017. Considering undeclining SaaS adoption rates and that an increasing number of SaaS app purchases are made bypassing IT and Procurement, thus exposing the whole business to security and compliance risks, as well as extra expenses, it’s time to work out a dedicated cost optimization procedure.
At Binadox we have developed the following SaaS cost optimization process:
- First of all you need information. To optimize asset costs, you need to know what your assets are. Collecting data on the number of assets and their details manually, filling out endless spreadsheets, is cumbersome, time consuming and out of question. You definitely have other urgent issues to deal with. Besides, in most cases it’s impossible as SaaS-based apps leave no footprint on computers. With Binadox you can automatically discover all the SaaS subscribed to and used across your organization, associate each SaaS application with an employee, see what entitlements and functions are utilized.
- Compare the number of purchased SaaS applications with the number of those really used by employees, identify any unused, underused or abandoned licenses, and measure usage intensity on the basis of the data collected by Binadox SaaS Web Usage Monitoring, such as whether a given SaaS tab was in focus, the number of mouse movements, clicks and keyboard activity.
- Survey the employees to find out why they do not use the purchased SaaS applications or do not use them in full scope. You can also learn whether the employees are satisfied with the provided applications and whether these apps are really useful. Once you know what SaaS applications your employees find valuable, you can change your procurement and renewal plans accordingly to get discounts for volume contracts, cut excess SaaS spending, and improve ROI.
- Based on the collected data plan future purchases and manage SaaS renewals – whether you need to buy more of particular application entitlements or fewer. Decide also which entitlements and functionality are redundant and can be revoked/downgraded or can be reassigned to other employees. Binadox SaaS Web Usage Monitoring allows you to get insights, on the basis of which you can forecast your future SaaS budget and identify saving opportunities.
- Arrange training for those employees who appeared underqualified to adopt new apps. Once they know how to use new apps and their features, their productivity and SaaS usage efficiency will improve.
Taking into account forecasts of the leading software research and advisory firms, according to which SaaS adoption rates will only gain pace in the near future, having a consistent SaaS cost optimization procedure is critical. It is important to know how many entitlements were bought and how many are actually used, but knowing how many apps are actively used brings more value both for CFOs and CIOs, and your business in general. Having such insights allows you to proactively take measures to reduce SaaS spend and improve SaaS usage efficiency and employee productivity.