The CFO's guide to optimizing SaaS Spend

As we look ahead to the next years, the SaaS market is on its way to exceed 800 billion Euros, driven by the increasing adoption of tools, technology, and automation among high-growth companies. Our research indicates that 40% of enterprises allocate over 1€ million annually to SaaS, with 14% surpassing 5€ million. This trend underscores the critical need for effective SaaS license management to curb uncontrolled spending and ensure optimal resource allocation.

In today's landscape, organizations deploy upwards of 250 tools across various departments, resulting in a labyrinth of licenses scattered across emails, Slack channels, and local folders. This decentralized procurement gives rise to shadow IT, posing significant challenges in terms of data security and compliance.

At Corma, we recognize the pivotal role of comprehensive SaaS license management in addressing these complexities. By providing real-time visibility into expenditure and ownership, our platform empowers finance teams to streamline operations and maximize ROI.

What is SaaS License Management?

SaaS license management encompasses the organization, administration, and access control of cloud-based applications from a centralized platform. Unlike traditional software licenses, SaaS agreements grant users access to tools hosted and managed by vendors, typically on a subscription basis. Understanding and managing these agreements—covering aspects such as user scope, pricing, security provisions, and termination terms—is essential as the number of tools and users escalates.

Why SaaS License Management Matters

Effective SaaS license management is crucial for mitigating cost leakage, eliminating wastage, and ensuring compliance. Key challenges include:

• Unused Licenses: Organizations often pay for licenses that go unused due to turnover or underutilization.
• Overpaying and Duplicates: Decentralized purchasing leads to duplicate tool acquisitions and missed negotiation opportunities, resulting in inflated costs.
• Redundant Tools and Automatic Renewals: Without oversight, teams may maintain redundant tools with automatic renewal clauses, driving unnecessary expenditures.
• Shadow IT and Compliance Risks: Unsanctioned SaaS tools pose security risks and may violate regulatory standards like GDPR or NIS2. Companies in sensitive industries or with certifications like ISO 27001 are especially affected by this.

How SaaS License Management Works

Our platform consolidates all SaaS contracts onto a unified dashboard, offering comprehensive insights into costs, renewal dates, and usage patterns. It facilitates proactive management by sending alerts for upcoming renewals and fluctuations in pricing, enabling informed decision-making and cost optimization.

User Roles in SaaS Licensing Management

Managing diverse user roles — from IT administrators overseeing access to contract owners and end-users—is critical for maintaining data security and operational efficiency. Each role plays a crucial part in managing permissions and ensuring compliance with organizational policies.

Best Practices in SaaS License Management

To effectively manage SaaS licenses, consider these best practices:

• Invest in a SaaS Managment Platform Solution: Move beyond spreadsheets to a dedicated SaaS license management platform that offers robust features for organizing contracts, monitoring usage, and optimizing costs.
• Track Costs, Usage, and ROI: Gain visibility into expenditure and usage metrics to evaluate the ROI of each tool and justify renewal decisions.
• Set Up Timely Alerts: Implement alerts for upcoming renewals and pricing changes to facilitate proactive decision-making and cost control.
• Manage Employee Lifecycle: Streamline license management across the employee lifecycle, ensuring swift provisioning and revocation of licenses as roles evolve or employees depart.

SaaS expenditure represents a substantial portion of corporate budgets, yet many organizations lack the tools and processes for effective oversight and optimization. At Corma, our SaaS license management platform is designed to consolidate information, enhance visibility, and optimize spending across your organization.

Discover how Corma can transform your SaaS license management strategy to automate processes and cut cost. Schedule a demo today to see our platform in action.