Cloud technology has reshaped all areas of business operations, none more so than in software, where an emergence of accessible, as-a-Service (SaaS) offerings has changed the standard approach for many. Organisations can now deploy new software in an instant, easily scale as they onboard new users, and embrace new levels of flexibility that a cloud-based model offers.
But this isn’t without its downsides. The ease of SaaS adoption has led to a significant spike in the number of tools and applications deployed across businesses. In fact, Productiv reports that an average organisation has a SaaS portfolio of 342 applications. While many of these are free tools or low-level subscriptions adopted by users in the spur of the moment to meet a specific need, many will be wider investments that incur monthly or annual charges as part of paid-for plans.
Over time, these subscriptions quickly add up. In 2024, the average organisation spent over $5000 USD on SaaS per user per year.
At a time where organisations are reviewing budgets with a keener eye, and want to ensure greater value from every investment, optimising your SaaS portfolio should be a fundamental part of your IT strategy for 2025 to help keep your business running at its best.
The hidden cost of software bloat
While the right software can quickly cement itself as one of your most powerful business assets, many organisations fail to get the full value out of their investments due to the sheer number of tools and platforms deployed.
The ease of adoption for SaaS solutions is both a blessing and a curse in this regard. While it allows organisations to quickly access new tools and capabilities, this can often be done without thinking about the long-term impacts on the business. A user or department may quickly seek out a new SaaS solution for a specific, single workflow, without considering if their existing software estate contains tools that offer the same functionality. It’s also not uncommon for organisations to overprovision user licences to these platforms, overestimating their utility and giving individuals access to tools that don’t actually support their day-to-day activities.
This can quickly escalate, especially if decision-makers don’t take the time to review their current software estate before authorising new software licences, or if nobody within the organisation has a centralised view of what software is currently deployed, and what it can do. This lack of oversight leads to the spread of “shadow IT” – software that has been adopted by users without the oversight of the wider business. These applications may have poorly protected access control and lax security, creating additional risk by potentially allowing bad actors to gain access to admin or billing controls for specific services.
A bloated software portfolio also leads to productivity and collaboration challenges. If different teams use their own SaaS solutions, their data can become siloed, limiting access and hampering collaboration across the organisation, while also increasing cloud costs further as multiple copies of the same data are stored for different uses.
The net result? Businesses spend more to continue their day-to-day operations with minimal short-term efficiency gains, while their IT environments become unnecessarily convoluted, less secure and increasingly expensive to manage.
Taking control of your SaaS costs
To start optimising your SaaS estate, it’s critical to first understand what software licences your business currently holds, and how these are currently being using. In practical terms, reviewing outgoing invoices for licence and subscription fees can be one of the best places to start building a comprehensive list. If the management of your IT is outsourced to an external provider, they should be keeping tabs on subscriptions and can help you build this list.
This audit helps to identify and remediate any obvious redundancies – whether these are licences going unused, duplicate subscriptions, or software that’s no longer needed for business operations.
In addition to removing these unwanted subscriptions, downgrading your licence level within certain platforms can help to reduce expenditure without sacrificing the features your users need. These changes are easy wins, bringing about immediate cost savings for your business and laying the groundwork for a more efficient IT strategy.
The next step is consolidation – many SaaS vendors offer a wide range of different functionalities as part of their platform, and choosing the right solution can help you unify multiple business processes within a single tool. By genuinely reviewing the capabilities of existing tools, or finding a more versatile alternative, you can streamline multiple workflows within the same SaaS platform to enable easier collaboration between users with different roles. This also reduces the training and onboarding time for new employees, who will no longer need to develop familiarity and capabilities across multiple tools.
CRM platforms are one common example. Many of these solutions also offer built-in email and social media management tools, which provide an easy way to bring sales and marketing functions into a single licence. In turn, this breaks down siloes around data, and helps your CRM become a stronger, unified resource across your business as a result.
Another common consolidation opportunity is with Microsoft 365. Many M365 licences include access to a range of applications beyond the traditional Microsoft Office suite, such as world-class cybersecurity tools, which can be utilised as part of an existing subscription to enhance your defences without the need to invest an additional, third-party apps.
While they incur an additional cost, software asset management (SAM) tools can also prove to be a powerful assistant to optimise your SaaS portfolio, especially for larger businesses or those with more complex IT environments. These solutions help keep your IT environment optimised automatically and manage your software licences with minimal human effort, often helping to save money in the long term.
Expert support for SaaS optimisation
SaaS optimisation can be a difficult process, but the benefit is clear – a simplified, cost-effective IT environment that works for all users in your organisation.
We’ve helped countless customers optimise their software strategy, ensuring they get the best deal while still harnessing the flexibility and scalability that SaaS can bring. If you’re worried your IT environment is growing out of your control, we can help conduct a full audit, clear out unneeded subscriptions, and consolidate your software licences. Get in touch today and start optimising your IT strategy for 2025 and beyond.