August 31, 2019
3
MIN READ

Why should we waste $64 million a day on SaaS? Maybe we should consider managing it.

Finance
Operations

The emergence of SaaS has been a response to the demand for immediacy in businesses. Company employees no longer want to wait for the long lead times for central procurement and IT teams to purchase on-premise software.

The emergence of SaaS has been a response to the demand for immediacy in businesses. Company employees no longer want to wait for the long lead times for central procurement and IT teams to purchase on-premise software. Employees want to have access to software that will help them deliver their work in the fastest and most effective way as and when they need it.

Purchasing SaaS is quick, learning how to use SaaS is easy and the cost is a fraction of the alternative. Therefore, employees just do it, they buy SaaS with or without IT involvement.

The benefits that adopting SaaS brings for companies, teams and employees do come at a cost for the business in the form of inefficiencies such as duplication of tools across teams as there is no visibility on what others use; scattered and ill-controlled admin rights of key infrastructure; payment of unused services which are no longer needed; not having visibility over who has access to what tools which results in difficulties controlling if someone continues having access to your data way after they have left the company, this is especially relevant as the number of contractors keeps increasing (40% of the workforce in the US will consist of contractors by 2020, according to a study made by Intuit) ; lack of clarity of which SaaS is being used to get things done makes it even more challenging to optimise processes.

SaaS benefits are still greater than the cost of those inefficiencies but as companies grow inefficiencies grow with them. Currently we are wasting $64 million a day on unused SaaS.

Giving companies the ability to manage SaaS and potentially cancel those subscriptions that would otherwise fall under the radar of the company, can be seen by SaaS companies as a threat to their strategy of making you forget about them. But I think that there is actually a benefit for SaaS companies as well.

Some companies have been reluctant to adopt SaaS because they are afraid that it will spiral out of control and become unmanageable. Giving companies SaaS management tools would help those companies switch to the cloud.

Maybe SaaS companies would experience more churn as companies would have visibility over which subscriptions to cancel as soon as they are not needed but equally there may also be an improvement of conversion rates as companies would feel more in control of their SaaS spending.

It is known that in many companies, a meaningful percentage of revenue is made from dormant users. If all those users had an easy way to cancel their unused subscriptions, SaaS companies would be incentivised to improve their product to turn it from dormant to active rather than from dormant to cancelled.

Contents

Contents

Subscribe to our newsletter

Receive the latest insights in your inbox

Share this post

Subscribe to our newsletter and stay informed on the latest SaaS insights

Explore more

Explore more

How to write a CFO report: 2 free examples

Assessing and communicating your company’s fiscal status is a key responsibility for finance leaders. Here are 2 CFO report examples to speed this up.
Read more

What does a great CEO-CFO relationship look like? 10 Tips

As a CFO, you’re the CEO’s right hand person. The company hinges on your working relationship—so here’s how to strengthen it.
Read more

7-Step Checklist to Improve Employee SaaS Onboarding

Here’s how to plan a super smooth employee SaaS onboarding: one that gives new hires an excellent first impression and sets them up to add value as soon as possible.
Read more

The Best Cap Table Management Software: 5 Options for 2024

Essential information on the 5 best cap management software tools for 2024, and why each one could be a great fit for your business.
Read more

Your First 90 Days as CFO: 11 Steps to Early Success

Your first 90 days as CFO at a new company set the trajectory of this chapter of your career. Here’s a checklist of how to play these valuable initial weeks for maximum impact.
Read more

The Top Subscription Analytics Software for 2024: ChartMogul vs Baremetrics

If you’re a CFO for a tech company, subscription analytics software will make your job a lot easier. Here’s a rundown of two of the best.
Read more

The Top Accounts Receivable Software for 2024: Upflow vs Chaser

Here’s everything you need to know if you’re in the market for accounts receivable software and want to make the best choice, with a focus on Upflow and Chaser, two leading options.
Read more

10 CFO Performance Metrics: What Makes a Great Finance lead?

These 10 performance metrics indicate a great CFO. Fulfil these criteria, and you’re on track to lead your business to financial success. 
Read more

How Scaleups Can Maximize Software ROI in 2024

Wondering how to improve software ROI for your company? In this post, you’ll learn everything you need to know to drive maximum ROI from software investments.
Read more

A Comprehensive Guide to Key Performance Indicators for CFOs

Here’s 23 KPIs CFOs should track in order to gain a full overview of their business’ financial health.
Read more

14 Smart Strategies to Reduce IT Costs as a CFO

Software is typically a company’s second biggest expense after payroll, so here are 14 actionable ways to get your spending under control and reduce IT costs.
Read more

10 Must-Have Software Tools for CFOs

According to Cledara’s data, these software tools for CFOs are absolutely invaluable. Save time, reduce errors and increase compliance with these programs.
Read more

The Complete Guide to Forecasting SaaS Costs for 2024

As we enter 2024, accurately forecasting SaaS costs is more critical than ever for CFOs. With tightened funding, volatile markets, and increasing SaaS expenditures, getting your 2024 projections right has major implications. This comprehensive guide equips you with the key strategies to master SaaS cost forecasting.
Read more

Have You Secured Your Software Stack?

SaaS security is a set of practices, protocols, and processes that have the primary goal of ensuring the security of a company's SaaS environment.
Read more

Financial Planning and Analysis (FP&A) Top 10 Software Tools

Interested in learning how to enhance your FP&A strategy with the right software tools? This guide is here to help.
Read more