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Why Your Organization Needs SaaS Spend Optimization

 

The cloud is going nowhere. At this point, most larger enterprises operate at least in part on the cloud. It’s easier to manage, provides cost benefits, and keeps the entire organization agile. But the cost savings aren’t guaranteed. Especially if nobody’s actively managing SaaS spend. Overspending on subscription software is incredibly common. 

In this blog, we’ll look at a few reasons why optimizing your SaaS spend needs to part of your 2021 road map.

Redundant SaaS Solutionsbusiness documents on office table with smart phone and laptop computer and graph financial with social network diagram and three colleagues discussing data in the background

The fact is that most enterprises overspend on SaaS applications. That’s because many applications have overlapping or redundant capabilities. Think:

  • Microsoft Teams vs Slack
  • SharePoint vs Dropbox
  • Asana vs Trello

And while it might seem that redundancy isn’t a big deal, it can be! That extra $20/month… that extra $99/year… Maybe more…

Depending on how many seats your organization pays for, those costs can add up—fast. (In fact, we’ve seen some enterprises save hundreds of thousands per year just by reducing SaaS redundancy. Cutting or limiting applications that duplicate other applications is necessary. It’s a key part of SaaS cost optimization and strategy.

Overbuying SaaS

Part of the agility of SaaS applications is in their flexibility. Additional seats can be paid for and on the ready to speed up onboarding. Most would agree that it’s better to have too many seats than to have too few. But that surge capacity and ability to quickly adapt to new hires costs money. Especially after an intern leaves, the company restructures, or a department downsizes.

We’ve seen some organizations paying for dozens more seats than they need—even when accounting for onboarding flexibility. Depending on the size of the company, that could be hundreds of thousands more in wasted SaaS spend.

Incorrect SaaS License Tiers

Many SaaS applications feature different license tiers. Some are for basic users and some are for power users who need every feature that the app provides. Analyzing application usage can show you which users actually need higher license tiers. Converting other license tiers to lower or basic levels can free up a fair amount of money.

This is aspect of SaaS management may seem minor, but it can significantly optimize your SaaS spend.

What Organizations Can Do

Hypershift can help organizations with several important activities regarding SaaS management. For example, we provide:

  • SaaS licensing optimization
  • SaaS cost analysis
  • SaaS recommendations and reselling

One thing to note is that not al SaaS resellers offer the same services, prices, or transparency. Work with a SaaS consultant who can provide not just advantageous pricing—make sure they have your best interests at heart.

About Hypershift

Hypershift is a DC-based consultancy focused on SaaS services, subscription software, and cloud technologies. We help organizations navigate their shift toward subscription software models. We ensure best-in-class security, support, and management to optimize enterprise-level cloud strategies.

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