Discover a clear path to eliminate waste, enforce compliance, and streamline your SaaS environment.
Author: Jocel Siglos
Contributors: Kristine Briggs, Vinay Patel, Bernard Williams, Ph.D PMP
In today's digital landscape, Software as a Service (SaaS) applications have become integral to business operations, offering flexibility and scalability. However, the proliferation of these applications introduces challenges such as shadow IT, compliance risks, and escalating costs. People with company cards and good intentions subscribe to SaaS applications and put your company's data in them without telling you. Effective SaaS governance is essential to manage these challenges, ensuring that SaaS applications align with business objectives, maintain security standards, and comply with relevant regulations.
Many companies we have worked with acknowledge that SaaS Governance, or lack thereof, is a big problem, but they don't know how to tackle it or don't have the bandwidth to implement a solution. It is often unclear who, specifically, is responsible for cleaning up the situation and implementing governance processes. It seems overwhelming to even get started. To be clear, taking ANY steps to improve the situation is better than taking no steps. Craft a plan, and take it a step at a time. While doing it, ensure your entire company understands what you are doing and why it is essential.
This article will outline a straightforward, four-step approach to enhance SaaS governance within your organization.
Gaining comprehensive visibility into your SaaS environment is the foundation of effective governance. Organizations risk unmanaged applications, security vulnerabilities, and unnecessary expenditures without it. Unmonitored SaaS applications can lead to shadow IT, where employees use unauthorized tools that bypass IT controls, introducing security and compliance risks.
To tackle this, organizations can use SaaS management platforms (SMPs). These tools help identify and manage all active SaaS applications across departments. Additionally, monitoring network traffic and conducting regular audits can uncover unauthorized or redundant apps. Given the constantly evolving SaaS landscape, it is vital to implement continuous monitoring to keep track of new applications and maintain control.
A centralized governance framework brings structure and accountability to SaaS management. It defines how applications are procured, used, and eventually decommissioned. Clear procurement guidelines ensure that new tools are evaluated and approved systematically. Usage policies define acceptable use, data handling, and security requirements, while decommissioning procedures help safely retire applications when they are no longer needed.
Assigning responsibilities across departments strengthens accountability and streamlines governance. Adopting a "Freedom within a Framework" approach balances innovation and oversight, allowing teams to select the necessary tools while staying compliant with policy. This framework should also integrate with existing corporate governance structures to ensure consistency across the organization.
Securing your SaaS environment is critical to protecting sensitive data and maintaining compliance. This begins with access management. Role-based access controls (RBAC) help ensure users only access the information necessary for their roles, minimizing the risk of data exposure. Multi-factor authentication (MFA) adds an extra layer of protection, particularly for high-risk applications.
Data protection efforts should include ensuring encryption both at rest and in transit. Regular data sharing and storage practices audits are also necessary to identify vulnerabilities. Organizations must align SaaS usage with regulations such as GDPR, HIPAA, or industry-specific standards, reviewing and updating their compliance policies as needed.
Optimizing usage and managing costs ensures your organization gets maximum value from its SaaS investments. Application rationalization helps identify redundant or underutilized tools. Using insights from SMPs, organizations can consolidate overlapping functionality and eliminate waste.
Cost management requires ongoing oversight. Monitoring subscription plans and adjusting them to match actual usage prevents overspending. Negotiating vendor contracts using real usage data can lead to better pricing and terms. Where possible, adopting usage-based billing aligns costs with actual consumption. Tracking performance metrics, such as user adoption rates and productivity gains, allows organizations to measure the effectiveness and ROI of each application.
Effective SaaS governance is essential for managing the complexities of a growing SaaS environment. By tackling the four focus areas outlined above, your team can ensure that your SaaS applications support your strategic goals and mitigate your risks. Additionally, you can squeeze the costs out of your SaaS spend. Some companies report up to 27% savings. With the average cost per employee for SaaS licensing ranging between $1,200/yr for small businesses up to $9,600/yr for larger, more complex organizations, those savings can add up quickly. How do you think your organization stacks up when managing your SaaS licensing? You can find out and get a free assessment and a customized improvement plan that you can execute against to start driving change today. Go to the link in the first comment to learn more and take the quick 5-minute assessment.