SaaS (software-as-a-service) or online software with a subscription payment model has become the preferred choice for many businesses nowadays.
While this kind of software is easier to use, it also brings challenges. Some of the challenges include the process of managing subscriptions, costs, and user access.
Without proper oversight, you might end up wasting resources, facing security risks, and potentially violating compliance requirements.
This problem is especially true as your business grows.
Without a system in place, you could be overspending on unused Licenses or struggling to track which employees have access to specific applications. There’s also the risk of former employees retaining access to your systems.
SaaS License Management offers a structured approach to tackle these issues.
It involves keeping a central record of all your SaaS subscriptions and monitoring how Licenses are used across your organisation.
So today, we are going to discuss more about SaaS License management.
We’ll explore its definition, the process of implementing it, and some tips and best practices to help you optimise your SaaS License usage and maintain compliance with software agreements.
Without further ado, let’s get to it.
What is SaaS License Management?
SaaS License Management is the process of overseeing and controlling an organisation’s software-as-a-service (SaaS) subscriptions and Licenses. It involves tracking, optimising, and administering the various cloud-based software applications used within a company.
The primary goals of SaaS License management are:
- Cost control: monitoring and optimising spending on SaaS applications.
- Usage tracking: understanding how employees use different software tools.
- Access management: controlling who has access to which applications and features.
- Compliance: staying within the terms of software licencing agreements.
- Security: reducing risks associated with unauthorised access to company data.
SaaS License Management typically covers the entire lifecycle of a software subscription, from procurement to renewal or termination. It involves maintaining an inventory of all SaaS applications, monitoring their usage, managing user accounts, and making informed decisions about renewals and new purchases.
More in Nexalab’s blog: What is SaaS Spend Management? Definition, Benefits, and Best Practices
Why Your Business Needs a SaaS License Management Strategy
SaaS License management is important, especially if your businesses depend heavily on the cloud-based software. A clear approach to handling these Licenses can benefit your company in several ways. It can help you save money, make your systems more secure, and help your employees work more efficiently.
Cost Control and Optimisation
SaaS management helps control costs by tracking and optimising software subscriptions.
It allows companies to identify unused or underutilised Licenses, eliminate redundant applications, and negotiate better terms with vendors. This approach can lead to cost savings over time, ensuring that the business gets the most value from its SaaS investments.
Enhanced Visibility and Decision-Making
A SaaS management strategy provides clear visibility into software usage across the organisation.
It allows tracking of which applications are being used, by whom, and how frequently. This insight is useful for making informed decisions about renewals, upgrades, or cancellations of subscriptions, ensuring that the software portfolio aligns with business needs.
Improved Security and Compliance
A SaaS License management strategy improves security and compliance through accurate software inventory and user access management.
This approach reduces the risk of unauthorised access to sensitive data and ensures organisational compliance with licencing agreements and regulatory requirements. Consequently, the business gains protection from potential legal and financial risks associated with security and compliance issues.
Streamlined Procurement Process
With a clear understanding of the current software landscape, companies can streamline the procurement process for new SaaS applications.
A good management strategy helps avoid redundant or unnecessary acquisitions, informs decisions about new purchases, and ensures that new software integrates well with existing systems. This leads to a more efficient and cost-effective procurement process.
Increased Productivity and Efficiency
A well-implemented SaaS License management strategy can boost productivity across the organisation.
Effective SaaS License management creates workplace efficiency through smart tool allocation and software optimisation. This strategy also highlights areas requiring application-specific training, thus enhancing team proficiency with available tools.
How to Implement SaaS License Management Strategy
Implementing a solid SaaS License management strategy is vital if you want to get the most out of your software investments, stay compliant, and run your operations smoothly.
But where do you should start?
There are at least 7 steps that you need to do to manage your SaaS License. It starts from procurement to implementation and monitoring processes.
Let’s look at the basic process of SaaS License Management Strategy according to Let’s dive into the details of the basic process of SaaS License Management Strategy according to WalkMe.
1. Establish a Procurement Process
To establish an effective SaaS License management system, start by creating a structured procurement process.
This process should include assessing the software needs of your organisation’s departments and teams. Research and compare SaaS providers to find suitable options. Understand different licencing models such as per-user, per-device, and concurrent user. Learn to negotiate terms, including pricing, service agreements and scalability.
Implement an approval process involving IT, finance, and legal departments. This approach helps ensure that software purchases meet organisational goals and comply with requirements. It can also lead to cost savings and improved service.
2. Create and Maintain a License Inventory
The next step you need to do is maintain a complete inventory.
Use a software asset management tool or database to centrally store License information. Record details like License types, quantities, expiration dates, costs, and vendor information for each application. Assign responsibility for keeping the inventory accurate to specific individuals or teams. Conduct regular audits to ensure the inventory stays current.
Use version control to track software updates and maintain compatibility and security across your organisation’s software.
3. Ensure Compliance
Compliance is important in SaaS License management. Review and document the terms of each licensing agreement. Use tools to monitor software usage and make sure it matches License terms. Train employees on License compliance and proper software use to prevent violations.
Conduct regular internal audits to find and fix compliance issues early. Stay informed about changes in licencing laws and regulations that affect your organisation to maintain compliance over time.
4. Optimise License Usage
To optimise License usage and save costs, you can use software analytics to identify underused and overused applications. Use this data to reallocate Licenses based on actual demand.
Adjust License types and quantities to match usage patterns. Remove duplicate or overlapping software to streamline your portfolio. A digital adoption platform can provide insights into software usage and user behaviour, helping further improve optimisation efforts.
5. Manage Renewals and Cancellations
Manage License renewals and cancellations to control costs. Create a renewal calendar to track upcoming renewals and avoid rushed decisions.
Assess each application’s need and value before renewing. Use usage data and market information to negotiate better terms. Develop a process for retiring Licenses, including data extraction and account closure.
Consider alternative solutions or vendors during renewals to ensure best value for your organisation.
6. Implement Monitoring and Reporting
Regular monitoring and reporting are essential for maintaining an effective strategy.
Set up automated monitoring tools to continuously track License usage, compliance, and costs. Generate periodic reports on License utilisation, compliance status, and cost trends to provide visibility to stakeholders. Develop key performance indicators (KPIs) to measure the effectiveness of your License management strategy.
Conduct trend analysis to inform future software investments and strategy adjustments. Regularly communicate findings and recommendations to relevant stakeholders to ensure alignment and support for your SaaS License management efforts.
7. Integrate with IT Asset Management
Integrating SaaS License management with broader IT asset management practices provides a more holistic approach.
Make sure your License management strategy aligns with overall IT goals and initiatives. Understand how different software applications interact and depend on each other to avoid disruptions when making changes.
Where possible, use integrated tools that can manage both SaaS and on-premise software assets for a unified view of your software landscape. Coordinate License management with other IT processes such as change management and service desk operations to create a cohesive IT management framework.
Take advantage of the knowledge and skills of your IT team to strengthen your License management strategy, drawing on their expertise in software deployment and management.
Managing Your SaaS License with A Software
In general, SaaS License management is just the general framework for businesses that want to optimise the usage of their online software.
Most of the time, it is done manually using spreadsheets or basic databases. This approach involves tracking License details, renewal dates, and usage information by hand.
While this method can work for companies with a small number of SaaS subscriptions, it becomes increasingly challenging and time-consuming as the number of applications grows.
Manual management requires diligent record-keeping and regular updates to maintain accuracy.
It also relies heavily on individual team members to remember renewal dates, track usage, and report changes. This can lead to oversights, missed renewals, or inefficient License allocation.
As an alternative to manual management, you might want to consider using SaaS management platforms (SMPs). These specialised tools are designed to automate and streamline many aspects of SaaS License management.
One example of an SMP is Octobits by Nexalabs.
SMPs like Octobits offer centralised dashboards for tracking all SaaS subscriptions, automated renewal reminders, usage analytics, and tools for optimising License allocation. They can also help discover shadow IT and ensure compliance with licencing terms.
While implementing an SMP does introduce another software cost, it can save significant time and resources in the long run.
SMPs can automate many manual tasks, provide better visibility into software usage, and help identify cost-saving opportunities. This kind of software is especially helpful if you have a business with a growing number of SaaS subscriptions.
More in Nexalab’s blog: SaaS Management Platform: All You Need to Know, From Features to Benefits
Conclusion
Managing SaaS Licenses properly is key to keeping costs down and running efficiently.
Whether you manage Licenses manually or use a SaaS Management Platform, having a clear plan is essential. Manual methods can work for smaller needs, but more complex SaaS setups often benefit from automated solutions. Selecting the right approach can help you make the most out of your software and boost productivity.
Octobits by Nexalabs can help simplify your SaaS License management. It automates tasks like tracking, renewals, and usage analysis, giving you a centralised place to handle all your SaaS subscriptions. Octobits can help you better understand your software usage, find ways to save costs, and ensure you comply with License terms.
Contact Nexalabs today to learn more about Octobits.
