Software-as-a-Service (SaaS) subscriptions have become an essential tool for businesses across a range of industries.
They offer numerous benefits like helping eliminate the need for businesses to invest in expensive hardware, software licenses, and infrastructure. The subscription-based pricing also allows companies to pay only for the services they need, leading to reduced costs and more predictable expenses.
Another benefit is that they are designed to scale easily as a business grows, or if its needs changes. Companies can add or remove users, adjust features, and manage resources without the need for significant infrastructure investments. The fact that they are hosted on cloud servers and are available through a web browser simplifies deployment and minimizes the need for in-house IT support. Updates, bug fixes, and new features are rolled out automatically, ensuring that businesses are always using the most up-to-date software.
Add that to the fact that these tools bring flexibility to the workplace by being able to be accessed from anywhere with an internet connection, which enables employees to work remotely and collaborate across geographic boundaries, business has seen constant increases in productivity and found happy employees across the board.
The benefits don’t end there. We can also talk about how easy it is to deploy and maintain SaaS tools, since often they have APIs and seamless integration capabilities that create a unified workflow and enhanced overall efficiency. Or can talk about the fact that maintaining the security of their platforms is the SaaS companies’ responsibility, unloading that additional burden to secure and comply with regulation in environments where business maintain their data onto a SaaS company they trust. We can’t forget to mention the ability to support rapid innovation, as SaaS providers can quickly and easily deploy updates and new features, and so businesses can take advantage of the latest technological advancements and stay ahead of their competition without any of the added work.
It all sounds like a dream, right? Well, it is. And that’s why companies are consistently increasing their budget to include SaaS tools within their business processes. A BetterCloud research found that organizations with more than 1,000 employees use 150+ SaaS applications every year. Companies with fewer than 50 employees use an average of at least 16 SaaS applications. By the end of 2023, 99% of companies will be using at least one SaaS solution to improve their internal processes.
That’s the challenge that to our article brings today: how to manage all SaaS subscriptions as businesses accumulate multiple subscriptions year upon year to keep up with technology’s innovations. In this article, we’ll discuss best practices for managing SaaS subscriptions, optimizing costs, and maximizing ROI.
Let’s get to it!
We were able to see why there’s undeniable value in acquiring SaaS subscriptions tailored to your business needs. But to make the best out of your hard approved budget, here are 7 key tips for managing your subscriptions and avoiding unused or underutilized licenses:
- Conduct a SaaS Audit
- Evaluate Usage
- Negotiate subscription deals
- Use subscription management tools
- Monitor subscription renewals
- Keep track of costs
- Develop a SaaS government policy
Conduct a SaaS Audit
Before businesses can effectively manage their SaaS subscriptions, they need to have a clear understanding of what they’re currently using. Conducting a SaaS audit can help businesses identify which SaaS subscriptions they have, how they’re being used, and who’s using them. This information can be used to identify potential cost savings opportunities and to negotiate better subscription deals.
Once businesses have a clear understanding of their SaaS subscriptions, they need to evaluate usage. This involves analyzing how frequently each subscription is being used, who’s using it, and for what purpose. This information can be used to identify subscriptions that are no longer necessary or subscriptions that can be downgraded to a lower tier.
Negotiate Subscription Deals
Once businesses have evaluated their SaaS usage, they can begin to negotiate better subscription deals. This can involve negotiating lower subscription costs, negotiating longer subscription terms, or negotiating additional features or services. Businesses should also be aware of any upcoming subscription renewals and negotiate renewal terms well in advance to avoid unexpected costs.
Use Subscription Management Tools
Subscription management tools can be a valuable asset for businesses looking to manage their SaaS subscriptions effectively. These tools can help businesses keep track of subscription renewals, monitor usage, and optimize costs. Some subscription management tools can also provide insights into which subscriptions are being used most frequently and by whom.
Monitor Subscription Renewals
Monitoring subscription renewals is critical for managing SaaS subscriptions effectively. Businesses should be aware of when their subscriptions are due for renewal and should evaluate their usage before renewing. If a subscription is no longer necessary, it should be cancelled or downgraded to a lower tier to avoid unnecessary costs.
Keep Track of Costs
Keeping track of SaaS subscription costs is essential for managing them effectively. Businesses should have a clear understanding of how much they’re spending on SaaS subscriptions each month and should track costs over time. This information can be used to identify potential cost savings opportunities and to ensure that businesses are getting the best value for their money.
Develop a SaaS Governance Policy
Finally, businesses should develop a SaaS governance policy to ensure that their SaaS subscriptions are being managed effectively. This policy should include guidelines for procurement, usage, and renewal of SaaS subscriptions, as well as guidelines for monitoring costs and usage.
And there you have it!
By following these best practices for managing SaaS subscriptions, businesses can optimize their costs, maximize ROI, and ensure that their subscriptions are being used effectively to justify the large investment made on them.