Octobits Blog – SaaS inventory management is a new field that’s changing how businesses handle their software assets.
As more companies start using Software as a Service (SaaS), they’re relying more and more on these solutions for their operations.
This growth brings with it a few hidden challenges, particularly around managing the proliferation of SaaS applications, ensuring security, and controlling costs.
A lot of companies have trouble with SaaS proliferation, which can lead to problems like having too many applications, spending too much money, and security issues.
Good SaaS inventory management can be a real game-changer. It offers structured ways to track, manage, and optimize SaaS usage, helping businesses get the most out of their software and keep control of their ecosystem.
So, let’s dig into how SaaS inventory management can help your business.
What Is SaaS Inventory Management?
SaaS inventory management is a way of tracking, managing, and optimizing the use of SaaS applications within an organization.
This means keeping track of all the SaaS apps you’re using, understanding how much they cost, how often you use them, whether they comply with security policies, and making sure they’re worth the investment.
With SaaS, you don’t install software on your own servers or devices. Instead, it’s hosted in the cloud and accessed via the internet.
This big difference means we need to think differently about inventory management. We need to focus on things like subscription models, user access, and data security.
For your reference, kindly read “Making Sense of Managed Services vs. SaaS: Your Business Quick Guide.”
Understanding SaaS Lifecycle
It’s vital to understand the SaaS lifecycle if you want to manage SaaS inventory effectively.
The life cycle has several different stages, each managed in its own way to ensure efficient use of resources and cost control.
The first stage is when you find out you need a SaaS app and start looking for it. You evaluate the options and then buy the subscription.
This stage often involves working with different departments to make sure the SaaS solutions chosen align with the company’s goals.
Once the application is ready to go, it’s time to get it up and running. This is where the onboarding stage comes in. It’s when the application is implemented, users are trained, and it’s integrated with existing systems.
A good onboarding process can help to reduce the time it takes to get value from the application and improve how quickly users start using it. This is important for getting the best return on investment.
The usage and optimization phase is all about keeping an eye on how the application is being used, measuring how happy users are with it, and making sure it’s performing well and not costing too much.
This is a big phase because it helps us identify applications that aren’t being used as much as they could be and reallocate resources to more valuable tools.
Finally, in the renewal or termination phase, they make decisions based on how much the application is being used and how much value it’s delivering.
Reviewing every so often can help you avoid renewing unnecessary apps and ensure that you only keep useful ones.
Each stage is a chance to optimize things, like negotiating good terms when you first start using the app and observing its usage to determine which ones are being used less.
Good lifecycle management helps you avoid common mistakes, such as unused subscriptions, too many applications, and compliance issues.
Importance of SaaS Inventory Management
Good SaaS inventory management is a must in current conditions. First and foremost, cost control is one essential reason.
If you don’t manage SaaS applications properly, they can end up costing you a pretty penny.
Keeping track of how much you use and how much it costs helps you cut down on waste and get better deals with your suppliers.
Scott Scharf’s in paper for the TradeGecko Expert Series Webinar says that businesses can save a lot of money by keeping track of their SaaS applications. If they don’t, they’ll end up spending more than they need to.
Just to give you an idea, the Productiv “2023 States of SaaS – Spend” report says that SaaS spending per employee now averages $9,643.
It also says that one-year contracts have increased as a percentage of all contracts from 79% in 2020 to 85% in 2022.
Security and compliance are also important. As more companies start using SaaS apps, it’s more important than ever to ensure data security and compliance with regulations.
Security concerns, particularly data encryption and access control, are a big problem.
Scott Scharf also discussed the importance of having solid security protocols and regular audits to reduce the risks associated with SaaS applications.
Good SaaS inventory management also helps to make things more efficient.
If businesses track which SaaS apps they have, they can ensure that they only use the ones they really need.
This not only saves money but also makes things run more smoothly and efficiently.
For instance, real-time inventory tracking and automation can make operations a lot more efficient, reducing the need for manual work and mistakes.
Finally, having a clear picture of what software you’re using and how it’s used gives you more insight to make better decisions and plan for the future.
A complete SaaS inventory gives you the necessary information to make smart decisions about software usage, costs, and compliance. This helps you align your software with your business goals.
As Scott Scharf mentioned, linking inventory management systems to other business platforms can give you a clear picture of what’s going on, which makes it easier to respond to changes in the business environment.
Steps to do a SaaS Inventory Management
The first thing we need to do is create an inventory of all the SaaS applications we’re using. This includes things like subscription costs, user counts, and contract terms.
Keeping this detailed record helps you spot any applications you don’t need and gives you a clear picture of how much you’re spending on SaaS. That’s really useful for managing costs.
Once you’ve got the inventory set up, it’s important to keep an eye on how the applications are being used. By keeping an eye on how applications are being used, companies can spot those that aren’t being used as much as they could be.
This step often uses tools that provide really detailed usage analytics, which helps businesses to make their applications work better.
Monitoring is key to making sure you only keep the apps you really need.
Next, it’s time to think about cost management. This means looking at how you’re spending money on SaaS and seeing if there are any ways you can save.
Automated SaaS management platforms can really help to make this process a lot easier.
These platforms give you all the info you need to see where your money is going and how you can make savings.
Security audits are an important part of managing your SaaS inventory. Regular audits make sure that all SaaS apps are following the security policies and data protection rules.
It’s a big deal to make sure you have strict access controls and encryption standards in place to keep your sensitive data safe.
This proactive approach helps to avoid potential security risks and makes sure that the company stays on the right side of all the rules and regulations.
The last thing to do is optimize. It’s a good idea to take a look at your SaaS portfolio from time to time. This helps you to make your costs more efficient, improve performance and keep your users happy.
This is where you get rid of or replace apps that aren’t needed anymore. This keeps the SaaS ecosystem streamlined and effective.
Keeping things up to date helps businesses adapt to changing needs and stay on top of their game.
With those steps, it is a good idea you have a specific person with a specific role for SaaS inventory management.
Kindly read “The Role of SaaS Manager: Your Tech-Ally for Maximizing Software ROI,” for reference about SaaS manager.
How Octobits Supports SaaS Inventory Management
At Octobits, we’re all about making your SaaS management life easier.
Our platform acts as your personal SaaS guide, finding all those hidden apps lurking in your company’s digital corners. No more surprise renewals or forgotten subscriptions.
But that’s just the start. We give you a clear picture of your SaaS landscape, showing you exactly how each tool is being used.
With this info, you can make smart choices and only pay for the software that really adds value to your business.
Are you worried about overspending? Octobits is like your own personal financial advisor, helping you identify underused apps and streamline your procurement processes. Say goodbye to wasting resources and hello to a healthier bottom line.
If you’re interested in getting started with Octobits, you can learn more on our website. You’ll get free access until the end of June 2024.
Absolutely! We want you to use Octobits for more than a week to see how our platform can help you with your SaaS inventory management.
Conclusion
If you understand the SaaS lifecycle and put in place some good management strategies, you can overcome the challenges of SaaS proliferation and make the most of cloud-based software.
Tools like Octobits can help make this process even smoother, giving you all the tools you need to track, manage, and optimize SaaS apps.
As the SaaS market keeps on growing, it’ll become more and more important to keep on top of your SaaS inventory management to stay competitive.
