SaaS spend management for IT: Optimize licenses and management

You may already know that you need a SaaS management platform to help you automate user lifecycle management, ease Google Workspace administration, or provide the SaaS data and file governance for a secure SaaS stack. But you may not know exactly why SaaS spend management for IT is important to optimize licenses and SaaS management. 

That’s our focus here: we explain why IT admins like you should not dismiss SaaS spend management out of hand. Before you close the next ad or in-app message about SaaS spend management capabilities, or insist another pesky SaaS spend management sales team leaves you alone, these applications offer some useful functions with big benefits. 

First, let’s get on the same page and explain more about spend management.

What is SaaS spend management for IT?

SaaS spend management is the active management of your organization’s SaaS spending and budgeting for the applications that run your organization. 

It involves:

• SaaS cost policy creation and management
• SaaS discovery of apps that authenticate to your domain
• Usage monitoring 
• Cost analysis by user, department, and application
• License allocation by user and department
• Contract negotiation 
• License optimization according to usage, entitlements, and employee sentiment.

SaaS spend management helps optimize licenses and operations

Time to back up and talk about what happens when you hit your SaaS contract license maximum. 

Let’s say you already automate onboarding using some kind of end-to-end SaaS management platform like BetterCloud. 

You run your workflow with a create user action like you always do. Except this time, you get an error message, like the one below.

"action": {
"name": "Create User"
},
"execution": {
"history": "ACTION_EXECUTION"
},
"exceptions": [
"412: {\n \"error\": {\n \"code\": 412,\n \"message\": \"Domain user limit reached.\",\n \"errors\": [\n {\n \"message\": \"Domain user limit reached.\",\n

You then proceed to open a support case with your SaaS management platform vendor to ask why your last create user action failed. You provide your instanceID to the support agent, only to learn that your organization’s domain hit your user limit with that SaaS vendor.

Next step, you then dig into your SaaS vendor contract to check your license maximum. Yet one more time, you can’t add any new users without first reaching into an already constrained budget. 

Your choices are to find more money to expand the number of available licenses or an unused license somewhere. 

The truth is you can avoid this situation – and time-consuming workflow errors that come with it – by proactively unassigning licenses for users who are inactive and no longer need them. 

How does this work? 

Regularly review spend management dashboards

All you need to do is take a quick look at the BetterCloud SaaS Spend Management dashboard at the Spend Management Microsoft Usage Extension.

In a flash, you see that 110 licenses are not activated, 73 of activated licenses are not engaged users. This means there’s a potential to reclaim up to 183 licenses, allowing you to immediately deploy one for your new user. 

But that’s not all. In addition to identifying unused licenses, you also surface a potentially large SaaS spending reduction. After all, who wants — or can afford — to have 183 idle SaaS licenses for nearly 37% of the total contact, just ratcheting up the invoice and nothing more?

Be a SaaS budget hero to Finance and Procurement

Undoubtedly, you should share these important SaaS spending insights with your finance and procurement departments. After all, by rightsizing this single SaaS vendor contract, your organization could save about $26,000. 

You could save thousands of dollars from rightsizing just one, single app. Now imagine all the SaaS savings you can uncover across your entire SaaS stack? What could your IT team or organization achieve with some extra budget? 

Reason 2: SaaS spend management helps IT improve security

Without robust SaaS spend management, chances are good you’re not keeping tabs on active licenses to optimize licenses. All too often, unattended licenses make for great entry points for unauthorized access. 

Before you know it, a rogue actor can steal permissions and access company intellectual property, financial data, or sensitive personally identifiable information. 

Improving security is why SaaS spend management is crucial for IT. 

Let’s review how this works.

Regularly check usage to common SaaS apps

Thanks to usage extensions, internal stakeholders can easily view insights on common SaaS apps and prioritize apps with the most inactive users. IT can then work with finance and procurement — over time as contracts are up for renegotiation — to optimize licenses by eliminating inactive ones.

After all, fewer active licenses make for fewer possible entry points, reducing likelihood of a security incident or breach.

Revoke unused licenses manually or via automation

In the meantime, once IT identifies users without need for assigned licenses, IT should revoke these neglected licenses. It can be done manually by eliminating access from individual users.

In addition, by simply selecting multiple users from user grids, IT can save time by removing idle licenses in bulk.

If you want to run an even tighter licensing ship, build a workflow to revoke unused licenses.

An easy way to get started is to easily create a new workflow from a SaaS management platform’s pre-built template. For example, BetterCloud users simply go to Workflow Templates found in the Workflow section.

Once you find and load the template, the next step is to locate the integration for the app requiring offboarding actions. Make sure to deselect all other integrations, so it only contains the needed app licenses.

Revocation from departing users

For those of you who are unaware of what this term means, a trigger is a condition that when met, starts the workflow. In the example in the image below, this workflow triggers when a user’s status is set to disabled.

Once created, your last step is to publish your workflow. This way, as users depart and get disabled within the SaaS management platform, the system automatically reclaims their licenses. 

With this workflow, that SaaS license is instantly ready for quick redeployment. The result is optimized SaaS app licenses with no SaaS budget dollar going to waste.

What if you only want to reclaim unused licenses for an existing user or employee?

Reclamation from existing user

Keeping all other licenses in place, you want to make sure they no longer have access to SaaS apps they don’t use. To accomplish this SaaS management task, you run that very same offboarding workflow on-demand. 

All you need to do is select the user from the Directory grid and search for the workflow name in the action menu. 

Once you load it, this time, select only the actions you need to run for the users with inactive licenses, making sure to deselect all other actions.

It’s that easy.

So to sum it all up, by using the right SaaS spend management for IT, complete with robust automation capabilities, you and your team can leverage critical usage insights to:

• Identify inactive and unengaged users
• Uncover unnecessary SaaS spending, however you want to define it
• Work with finance and procurement during renewals to rightsize contracts 
• Reduce entry points for unauthorized users
• Operate either a manual or automated process to revoke unused licenses
• Save, ultimately, on the SaaS budget

Use BetterCloud, the only all-in-one SaaS management solution available today

BetterCloud is more than just a spend management tool. It’s a comprehensive platform that empowers you to gain control of your SaaS stack, users, data, and spending. Using BetterCloud, IT can both easily manage SaaS at scale while optimizing SaaS licenses and spending.

With robust, granular automation, BetterCloud helps you:

• Discover and manage all your SaaS subscriptions
• Enforce usage policies and prevent unauthorized spending
• Optimize your SaaS portfolio and licenses
• Gain new insights into SaaS spending

By leveraging BetterCloud’s powerful features, you can:

• Reduce SaaS costs by identifying and eliminating unnecessary subscriptions.
• Improve security by enforcing strong access controls and preventing unauthorized access.
• Scale IT impact by using intuitive, flexible, time-saving automation tools 
• Enhance efficiency by streamlining SaaS management processes including user lifecycle management.
• Make data-driven decisions with actionable insights into your SaaS spending.

Wondering how much you can save with BetterCloud?

Take control of your SaaS license management now.

Don’t let your expensive SaaS licenses sit idle, while spending spirals out of control. Take charge and ensure that your technology investments are working as hard as you are.

Schedule a demo today and learn how we can help you optimize your SaaS investments.