3 Reasons to Prioritize SaaS Spend Management

Developed and introduced in the early 2000s, Software-as-a-Service (SaaS) aims to provide a low-cost alternative to traditional IT installations, where the IT landscape has to be purchased, installed, and maintained by IT departments or external IT professionals.

Three important pillars of SaaS usage can be named, which will also help companies in the decision phase for the use of Software-as-a-Service.

But before we get started and take a closer look at the three main pillars, we first need to get the question out of the way:

What is Software-as-a-Service?

The Software-as-a-Service (SaaS) is a part of cloud computing. Based on the concept that the software and the IT infrastructure are operated by an external IT service provider and used by the customer as a service. The SaaS model is a service that can be used by the customer. For using online services, you need an internet-capable computer as well as an internet connection to the external IT service provider. Access to the software is usually realized through a web browser. In order to use and operate the service, its user pays a usage-dependent fee. The SaaS model saves the service user from some of the acquisition and operating costs. However, the service provider is responsible for the complete IT administration and additional services such as ongoing maintenance and updates. With this in mind, the IT infrastructure, including all administrative tasks, is outsourced and the service user can concentrate on its business.

Now back to the topic at hand:

What is SaaS Spend Management?

SaaS Spend Management is in the process of measuring the SaaS costs of enterprises and evaluating the performance of their SaaS inventory. The SaaS spending of businesses is increasing day by day. In addition, the number of SaaS solutions is increasing for many sectors. Businesses must measure the efficiency of their SaaS spending to make the most of their existing IT budgets.

SaaS Management aims to save on IT costs by evaluating the use cases of SaaS applications, their costs and the IT value of the applications.

Why is it advisable to prioritize Software-as-a-Service (SaaS) Spend Management?

In the following lines, we will give you the most important reasons and explain them in detail. These reasons will hopefully enlighten you and answer any open questions you may have about SaaS. We can also call these reasons the 3 pillars of SaaS:

Implementation and Control

Companies can save on their own IT architecture, development time, and coordination with other IT systems. The SaaS provider ensures, as a rule, that everything runs smoothly. Resulting in a permanently usable system. The only requirement for using and accessing the SaaS system is a stable Internet connection and a working computer. With the help of the SaaS, you can carry out your activities around the clock even with external access to the system. Companies should make sure that connections are always secure, in other words, encrypted. For this reason, the level of encryption should be carefully compared with other providers.

With regard to management, the provider must ensure that communication is possible internally and externally via the same platform. Moreover, automatic and routine data backups should be arranged. The company should be able to make adjustments and enhancements itself. When it comes to usability, it becomes essential that even older employees can be integrated into the system.

Flexibility and Accessibility

Fundamentally, flexibility is much greater with an on-demand solution than with a self-administered, more developed, and maintained on-premises solution. While the term flexibility is intended to describe more than just flexible usage and customizable subscription models, it is also aimed to describe the ability to manage and export data. Data presentation and export, as well as ease of use, must also be taken into account. Employees must also be able to use the software over time.

The use of SaaS is only flexible and logical if the company can use the software flexibly, regardless of the order. This means that the employees are not additionally restricted. As well, SaaS is particularly well suited for companies that are in the process of growth. The individual applications and functions can be used independently of each other and can also be added or removed as required. Customizing to new requirements is cost-effective and not a waste of time. It is worth noting that software updates can be taken over by the supplier without additional costs.

Cost Saving

A key benefit of using SaaS is the cost advantage. Before migrating from in-house software licenses to SaaS, companies want a transparent presentation of the expected costs. Suppliers are generally transparent enough to list and explain all costs from the outset. For example, it is common for in-house IT departments to spend more than half of the existing maintenance budget for the in-house IT landscape. Other maintenance and repair costs may also be unpredictable as well. The SaaS concept is particularly recommended for companies in the growth phase. In the starting phase of a company, enormous investments are made, which can be avoided at the beginning.

An itemized statement can provide each user of the software with an overview of the various variable and fixed costs incurred in the company. Particular interest is paid to the variable costs because, on the one hand, they can represent the additional costs, but on the other hand, they also stand for timely and well-needed flexibility. By avoiding the company's own entrepreneurial capital risk and offering flexibility, SaaS enables a stronger focus on the company's own main focus areas and thus an adaptation of the company's own IT competencies and resources in line with requirements. And with it a needs-based adjustment of your own IT skills and resources and thereby more time for your own customers. It is important to understand that the software used must be efficient and effective.

SaaS brings many other benefits that are adaptable to each company in any sector. Companies all over the world are switching to the SaaS system, where they can easily rent services and expand and optimize their workload in other fields. Other advantages worth mentioning are that no hardware has to be purchased, installed, and maintained. In addition, there are no expensive, recurring licensing costs. The SaaS offers, as also mentioned before, ease in compatibility.

How to Manage the SaaS Spend Better?

SaaS Management System

If you are looking for a SaaS system adapted to your company, we have the right solution for your IT infrastructure. By using our Loggle IT Asset Management Software, you can better manage your SaaS spending. Having an IT Asset Management Software equals more efficiency.

If you want to learn more about IT Asset Management Software and Loggle, have a look at the article by surfing our blogposts.

Feel free to contact us and we can make an appointment for a personalized demo and also consultation. As Loggle, we are happy to contribute to the growth and success of your business.