Intro

In today’s business world, we use software as a service (SaaS) to digitize both simple and complicated tasks. We hope to increase our value chain and assure business continuity by using SaaS.

For organizations, SaaS is akin to feeding a human. The meals and beverages we consume, as well as our habits, are inputs that have a significant impact on our health and quality of life. We may lose our health, motivation, and the results and values we produce if the inputs are not correct and straightforward.

Because SaaS is so important to our organizations, it is an important input. Just as choosing the right and adequately determining the inputs we consume as individuals is important, it is extremely valuable to use the right SaaS solutions and to optimize the solutions we have in terms of our organization’s health, business continuity, and resource allocation.

We’ll discuss SaaS cost optimization in this article, which is used to appropriately evaluate SaaS supply for the health, efficiency, and continuity of business processes.

What is SaaS cost optimization?

The examination of the costs and advantages of the software services supplied for our business processes, as well as the provisioning of the proper SaaS preferences by avoiding duplicate solutions in a straightforward and reasonable manner, are all examples of SaaS cost optimization.

In a similar vein, we should work to ensure that our organizations are well nourished.

Why is SaaS cost optimization important?

We are continually observing the deployment of diverse solutions for comparable needs for different departments in company processes. Some solutions are only employed on a limited basis, and this is owing to the existence of a SaaS solution provided for the needs of a different department, contrary to what would be expected based on the cost covered. In other words, because recurring solutions are purchased indirectly to meet a demand, the hidden cost component enters the equation, driving up expenses and wasting resources.

To avoid hidden costs, cluttered business processes, communication breakdown between business units, and customer dissatisfaction, SaaS cost optimization is critical.

What are the benefits of SaaS cost optimization?

By optimizing SaaS inputs and usage opportunities financially,

1. A resource can be created to invest in the future of the organization,
2. Multiple business functions can be integrated from a single source over a single SaaS solution,
3. Information security can be strengthened, and costs can be reduced in terms of information security by advancing through a single solution instead of having information in different systems,
4. Customer satisfaction can be increased, and internal stakeholder relations can be strengthened, as progress from a single system will enable more functional management of stakeholder relations and customer satisfaction.
5. Up-to-date technologies can be more easily integrated, and maintenance costs can be reduced.

How can companies achieve effective SaaS cost optimization?

Companies can better manage SaaS optimization by making a list of their assets, needs, and options, examining the cluster links between these lists in the context of their culture, and managing assets within that framework.

Simplex SaaS Cost Optimization Venn Scheme
Built by Baran Curu at Canva

The assets, namely the tools used, the services, and finally the needs and supply choices that meet these demands are all listed and mapped in this framework.

Let’s unpack this approach one by one.

1.    Listing Assets (Resources)

It would be correct to identify the assets covered by the present supply, as well as the cost of these supplies, for the tools and services we currently utilize. In the next step, each asset, tool, and service on this list should be linked to other clusters. As a result, with an integrated perspective, the maximum benefit and lowest cost will be noticed with the greatest amount of contact.

2.    Listing Needs

When listing the needs, it’s best to categorize them by department. Each department has processes that contribute to the value chain of the organization. Because these processes progress as a result of their interactions with various departments, listing the needs separately and, if possible, associating the listed needs with variables in other clusters in order to list them from beginning to end with an integrated perspective, will help to meet the minimum cost and maximum benefit targets and provide a solid input for the integrated perspective.

3.    Listing Options

Following the previous lists, the alternatives should be listed in such a way that they can be examined independently of the other lists before being combined. Standard information, such as cost, licensing models, maintenance charges, calendar information, and integrations, might be included in this section. In addition to this information, a representative from each department, in collaboration with the department, will evaluate and score the options based on a few needs’ parameters, and this process will be completed by all possible stakeholders, forming a solid foundation for the integrated approach in the final decision.

This process should be done through a common editable tool if possible and should be kept transparent. (Business Intelligence tools or a simple Google Spreadsheets, Microsoft Excel Web, Survey can be used accordingly.)

4.    Determining the Solution

The ideal solution, where the findings in the lists intersect at the center or closest to the intersection, should be preferred in the final decision, and development should be requested by proceeding through this solution, and a separate software supply for missing functions should be avoided as much as possible.

What are the challenges of SaaS cost optimization?

Managing existing cultures and assets will cause the most issues when it comes to reducing SaaS costs. Over time, existing solutions become habits. Individuals and organizations are attached to the procedures and methods they are familiar with; they will not embrace change that they are unfamiliar with, believing it to be a loss rather than a gain. As a result, change management, labor expenses, habits, stakeholder relations, and other elements based on the company’s culture should all be taken into account in a balanced and integrated manner.

Simplex SaaS Cost Optimization: Integrated Digital Systems Perspective in a Nutshell Venn Scheme
Built by Baran Curu at Canva