I once discovered a marketing team using five different design tools, each with its own subscription, because no one had time to evaluate which one worked best. That's when I realized SaaS optimization isn't just about cutting costs; it's about creating sanity.
In today's cloud-first environment, SaaS spending has become one of the fastest-growing line items in company budgets, often increasing 20-30% year over year. While Finance teams traditionally own cost-cutting initiatives, IT departments are uniquely positioned to lead SaaS optimization efforts. Their technical expertise, visibility across departments, and understanding of integration needs make them ideal partners in controlling runaway SaaS costs.
Why IT Must Lead SaaS Cost Optimization
Let's be honest: most Finance teams don't know the difference between Slack and Teams beyond their price tags. IT teams bring crucial context that transforms cost-cutting from a blunt instrument into a surgical tool.
Here's why IT needs to drive this process:
- IT sees the whole picture across departments. When Marketing buys Asana while Engineering uses Jira and Sales relies on Monday.com, only IT notices you're paying for three project management tools doing essentially the same thing.
- Technical integration knowledge lives in IT, not Finance. I've seen companies pay for premium Salesforce licenses while also maintaining a separate CRM because nobody realized the overlap. Understanding how tools connect requires technical expertise that Finance simply doesn't have.
- Usage data is IT's domain. Through single sign-on systems like Okta or Azure AD, IT can see which tools employees actually use versus what they claim they need. At one company I worked with, we discovered 40% of "business-critical" licenses hadn't been accessed in over 90 days.
- Vendor relationships belong to IT. When it's time to negotiate that renewal, IT knows whether there are viable alternatives or if you're truly locked in. I've seen this leverage turn a 15% price increase into a 10% discount during negotiations.
So what can IT actually do about it? Here's a practical approach that works:
- Create a Comprehensive SaaS Inventory
- You can't optimize what you can't see. And trust me, you're seeing only the tip of the iceberg.
- Action Steps:
- Deploy SaaS discovery tools like Zylo or Productiv. Don't have the budget? Even a simple browser extension scanner can uncover shadow IT your expense reports miss.
- Document ownership, contract terms, and spend in one place. I've seen spreadsheets work fine for companies with under 50 SaaS tools. You may download our free worksheet here.
- Categorize by function. When you group tools by what they do (communication, project management, design), the redundancies become painfully obvious.
- Make this inventory accessible to both IT and Finance. Transparency between departments is your secret weapon.
- Analyze Usage and Adoption Data
- Most companies are shocked when they see actual usage data. I've never seen a SaaS tool where 100% of purchased licenses were actively used.
- Action Steps:
- Pull login data from your SSO provider. This alone can identify zombie accounts that are costing you money.
- Flag licenses inactive for 30+ days. At one company, we recovered $37,000 annually just by reclaiming licenses from people who hadn't logged in for months.
- Compare usage with license tiers. I've seen entire teams with premium licenses who only use the basic features—a quick win for right-sizing.
- Create simple dashboards showing cost-per-active-user. This metric cuts through the noise and shows which tools deliver real value.
- Identify and Eliminate Redundancies
- Functional overlap is where the real money hides. I once found three separate teams paying for different video conferencing tools, each insisting theirs was "essential."
- Action Steps:
- Map applications by function. Create a simple grid showing which departments use which tools for the same purpose.
- Challenge the "we're different" excuse. When Engineering says they can't use the same project management tool as Marketing, ask why. Often the reasons are preference, not necessity.
- Test integration capabilities before consolidating. Make sure your chosen tool can support existing workflows.
- Plan the human side of migration. The biggest failure point isn't technical—it's forgetting that people hate change. Schedule training sessions and give teams time to adapt.
- Optimize License Management
- License management is boring until you realize how much money it saves. One client reduced their Salesforce spend by 22% through better license management alone.
- Action Steps:
- Connect user provisioning to HR systems. When someone leaves, their licenses should automatically be reclaimed, not left active for months.
- Create tiered access levels. Not everyone needs admin access or premium features. Create "viewer" or "basic" tiers for occasional users.
- Audit licenses 60-90 days before renewals. This timing gives you leverage with vendors before you're up against a renewal deadline.
- Develop a clear process for reclaiming inactive licenses. Set expectations that licenses unused for 60 days go back into the pool.
- Partner with Finance on Contract Negotiations
- IT and Finance bring complementary skills to vendor negotiations. I've seen this partnership turn routine renewals into significant cost savings.
- Action Steps:
- Build a joint renewal calendar with 90-day advance notice. Last-minute scrambles lead to poor decisions and missed savings opportunities.
- Push for contract flexibility, not just lower prices. The ability to reduce seats mid-contract often saves more than a small discount.
- Come armed with usage data. When a vendor sees that only 60% of licenses are active, their "standard increase" suddenly becomes negotiable.
- Consider multi-year deals only for proven tools. I've seen too many companies locked into long contracts for tools they later regretted.
Contrary to popular belief, the biggest obstacle to SaaS optimization isn't technical, it's cultural. Breaking down silos between IT, Finance, and department leaders is essential.
Regular Cost Reviews
Schedule quarterly SaaS reviews with Finance. These shouldn't be blame sessions but collaborative discussions about:
- Spending trends quarter-over-quarter
- Upcoming renewal opportunities
- Usage patterns for major applications
- Wins and savings to celebrate
Establish joint KPIs that matter to both IT and Finance:
- Cost per employee for key software categories
- Percentage of licenses actively used
- Savings achieved through consolidation
- ROI of major SaaS investments
Create dedicated spaces for ongoing SaaS discussions:
- A monthly optimization meeting with key stakeholders
- A shared Slack channel for quick questions and updates
- A collaborative workspace to track initiatives and progress
Here's a counterintuitive approach that works: instead of fighting shadow IT, recruit its leaders. The people bypassing your processes often understand their team's needs best. Turn them into allies by:
- Giving them a voice in tool selection
- Training them to evaluate new tools against existing ones
- Making them advocates for smart spending within their teams
While IT brings technical expertise, Finance brings crucial financial perspective:
Strategic Budget Allocation: Finance can help prioritize investments based on business impact. At one company, we created a simple scoring system for new SaaS requests that balanced cost against expected value.
ROI Analysis Framework: Finance can develop standardized methods for evaluating returns. This transforms conversations from "we need this tool" to "here's the value this tool will deliver."
Contract Expertise: Finance spots hidden costs that IT might miss. I've seen Finance teams identify auto-renewal clauses and escalating fees that would have otherwise slipped through.
Business Case Development: When consolidating tools, Finance helps build compelling cases beyond technical considerations. This is crucial for getting buy-in from resistant departments.
Measuring Success: Beyond Cost Savings
While saving money matters, the true value of SaaS optimization goes deeper:
- Improved Security: Every eliminated shadow IT application reduces your attack surface. One company I worked with decreased their security incidents by 30% after consolidating their SaaS stack.
- Increased Productivity: Fewer tools mean less context-switching. Teams spend more time working and less time juggling different systems.
- Better Data Integration: Consolidated systems create cleaner data flows. Marketing and Sales finally see the same customer information when they're using the same tools.
- Enhanced User Experience: Standardized tools create consistent experiences. New hires learn one system instead of five, reducing onboarding time and frustration.
Start by asking these questions about your current approach:
- Do you know every SaaS application being used across your company? (Hint: probably not)
- Can you see actual usage data for your major applications?
- Is there a process for evaluating new tools against what you already have?
- Do IT and Finance collaborate on SaaS management, or operate in silos?
- Identify and reclaim inactive licenses for your top 5 applications by spend
- Find obvious redundancies in major categories like project management or design
- Flag renewals coming in the next 90 days for joint IT-Finance review
- Create a simple approval process for new SaaS purchases
For more insights on optimizing your SaaS investments, visit www.cenplify.com.