Why Companies are Getting Worse at Spend Management
Today, spend management is important for every organization. However, it’s rather complex process and there are certain drawbacks that can get in your way of making budgeting or spend initiative effect. Most commonly these drawbacks prevent spend management from doing its job. Therefore, your company’s budget may suffer cause of this. On the other hand, the absence of spend management can be just as threatening.
The following explains why companies are getting worse at spend management, and discloses solutions to these drawbacks.
Recent years showed that SaaS adoption is uncontrollably growing across companies. This happens because SaaS applications replace almost every function and provide agility and flexibility to workflows. Beyond that, it’s far too easy to obtain a license and start using a SaaS application. On the downside, SaaS sprawl might become a prime obstacle for your spend management and a hole in the software budget.
The absence of SaaS control may easily lead to overspending for subscriptions that aren’t used by anyone. SaaS sprawl also leads to another critical spend management drawback – shadow IT.
Obviously, before managing subscriptions and their spend you should know about them in the first place. Shadow IT poses a crucial challenge for spend management. It complicates the discovery of SaaS licenses as well as sometimes overwhelming total amount of their price tags.
Shadow IT is blooming nowadays. Mostly because employees deploy a new application without consulting with IT teams. The absence of centralized SaaS app view is a significant reason why shadow IT is rapidly growing across organizations and why companies are struggling when it comes to spend management.
Another common spend management problem is using outdated data and waiting for better results. Forecasting or identifying useful expenses is tremendously hard without real-time info. Traditional expense management works with spending data that’s at least month old. This makes it difficult to tell what your money is doing for your company. You never know what the company is committed to paying for until a month after the fact, making it impossible to gauge the financial health of the business.
Aimless Budget Cutting
Many organizations are working with outdated data and traditional expense management. Therefore, they are simply unable to track spending habits and don’t know exactly what costs can and need to be cut. Cutting cost blindly or through outdated data posses another great challenge for spend management. Not every expense is something you need to get rid of. Some applications your company needs just cost more than others, and some expenses are beneficial and justifiable. Aimless budget cutting won’t necessarily solve your spend management problems. On the other hand, your company likely can’t stay within your budget without cutting and optimizing at least some costs.
Instead of trying to deal with these drawbacks one by one, organizations can now remove any obstacles to spend management at once. Binadox offers a solution for the most comprehensive SaaS spend management.
Remove All Obstacles to Spend Management
Binadox provides your company with better visibility, increased control, and improved flexibility to utilize your finances in a way that will best benefit your business. Spend management in your organization doesn’t have to be indiscriminate or hard process, it can be informed, smart, and simple. Let Binadox help you make your budgeting more effective and easy to manage. Register your free Binadox account today!