A SaaS spend management system is a set of programmes for controlling and optimising SaaS expenditure.
If you don’t have a solid system in place, it can be tough to keep track of all the SaaS apps used across departments.
This lack of visibility can lead to money being spent on unnecessary licences, unused subscriptions, and applications that do the same thing.
Now, let’s get into detail about how much money a good SaaS subscription management software can save you.
What Is a SaaS Spend Management System?
A SaaS spend management system is a complete platform for organisations to see what they’re spending on SaaS, make sure they’re getting the best value for money, and keep their data safe.
But, a common question arises when we talk about SaaS management platforms: Is SaaS an ERP em?
Let’s highlight the difference ERP is an integrated software system for managing core business processes, while SaaS describes the software delivery model.
However, ERP solutions can be delivered as SaaS applications, making ERP functions more accessible and scalable.
For reference on the SaaS spend management software on the market, take a look at “2024’s Best SaaS Spend Management Software for IT & Finance Leaders.”
On the other side, the rise of SaaS apps often means that procurement is decentralised, with different teams or individuals signing up for different tools.
A SaaS purchasing platform centralises this procurement process, allowing all departments to make software purchases through a single, coordinated system.
This can lead to a chaotic SaaS landscape, making it tricky for IT teams to keep track of licences, usage, and overall spending.
Meanwhile, keeping track of SaaS apps manually using spreadsheets is not only a time-consuming process but also prone to errors.
That’s where a SaaS spend management system can help. It can automate the process, giving you real-time visibility into SaaS usage and costs.
Given how things can change with SaaS subscriptions, it’s vital to keep an eye on renewals. Otherwise, you might get hit with an unexpected bill.
Take Rock Content, for instance. They’re a global content marketing solutions provider, and they saved over $1 million by implementing a SaaS management platform.
For more insights on fundamentals, please refer to “Tired of SaaS Surprises? Take Control of Your SaaS Spend Management.”
Why Businesses Need a SaaS Spend Management System
These days, businesses are facing some pretty steep SaaS costs and security risks because so many of them have jumped on the SaaS waggon without much coordination.
Let’s be honest: the challenges of this trend are real, especially the uncontrolled spread of SaaS apps within organisations.
This decentralised adoption, often driven by individual departments or employees, can lead to a fragmented SaaS ecosystem that is difficult to track and manage.
Zylo’s white paper shows how big companies use about 600 SaaS apps, but only 25% of them are managed by IT. This leads to many shadow IT and compliance issues.
This uncontrolled spread can mean organisations spend way more than they should on their SaaS budgets—in fact, they can spend over 300% more than they planned.
The sheer number of apps in this software ecosystem makes it difficult for companies to track what they’re using and what they’re not.
This often leads to millions of dollars being spent on licences for apps that aren’t even being used.
On top of that, if you don’t manage your renewals, you might end up renewing services you don’t even use, which wastes more resources.
Plus, SaaS management systems strengthen security by giving users full visibility, which helps reduce the risk of data breaches linked to unauthorised applications.
Meanwhile, for the strategy development, kindly check “A Beginner Guide to SaaS Spend Management Strategy for 2025.”
Features of SaaS Spend Management System
A SaaS spend management system offers several essential features that empower businesses to control costs, enhance security, and optimise software use.
The first thing is visibility because it is so foundational: a robust SaaS management platform provides a centralised inventory of all applications, categorising each by cost, usage, and compliance metrics.
This centralised view is vital in large organisations that typically deploy an average of 600 SaaS applications, where unmanaged apps contribute to budget overestimations by as much as 304%.
Another crucial feature is the ability to create a dynamically updated inventory of all business apps in use.
This inventory should encompass details such as product name, vendor, cost, renewal dates, and billing periods.
Automatic usage tracking is another critical feature. Through integrations with financial systems and usage analytics, these platforms identify unused or underutilised licences.
Another critical feature is the ability to assign a business owner to each application. This ensures accountability and ownership, preventing SaaS applications from falling through the cracks.
A good SaaS spend management system also enables organisations to identify and eliminate redundant licences, negotiate better deals with vendors, and consolidate applications with overlapping functionalities.
To gain insight into how those features of SaaS spend management software can align with business objectives, kindly read “Fundamental SaaS Spend Management Guide for Business Efficiency.“
How to Implement a SaaS Spend Management System in Your Organization
You’ve got to take a structured approach to implementing a SaaS spend management system if you want to get comprehensive control and optimisation.
This first step is crucial for spotting every app used across different parts of the business and making sure you know about all the shadow IT.
Once the inventory is done, set up automated tracking for licence usage and costs.
That’s why it’s a good idea to integrate financial data to monitor active subscriptions and user engagement. This helps you to spot underutilised tools and prevent duplicate functionality.
For example, Octobits, a SaaS spend management platform, can help you spot unnecessary apps and ensure you’re only paying for the ones you want.
Then, you can start setting up renewal alerts to avoid a large bill for unused licences. As a reminder, here is “Top 7 SaaS Spend Management Platforms in 2024 & Why They Are So Good.”
Finally, get your IT, finance, and procurement teams on board to ensure everyone’s on the same page and to keep an eye on the costs so your SaaS management fits with what your company needs now and in the future.
Or if you’d like a more comprehensive support system, just give us a shout anytime. We’re ready to get Octobits up and running in your business IT system. And there’s more good news: you can get Octobits for free until December 2024.
Or, you can check “Best Practices for a Successful SaaS Spend Management Process” for details on the implementation.
In Closing
As SaaS purchases are becoming more decentralised across departments, businesses are facing rising costs, increased security risks, and inefficiencies caused by unused or redundant applications.
If you embed a SaaS spend management system into your business processes, you’ll be setting the foundation for sustainable growth, operational efficiency, and cost control well into the future.
