SaaS sprawl is a problem that happens when a company’s software-as-a-service (SaaS) stack grows to a large and unmanageable size. It is also called “software sprawl.”

More often than not, SaaS sprawl can be unavoidable. Why? As a business grows, so does its need for digital tools. That means subscribing to an ever-increasing number of software over time, leading to SaaS sprawl, especially if the IT administrators need to learn about the purchases.

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SaaS sprawl can lead to several problems, including productivity loss, security issues, and wasted spending.

What Problems Can SaaS Sprawl Cause?

SaaS sprawl can cause several problems, the biggest of which are described below.

  • Productivity loss: Each application a company uses eats up bandwidth when used. If its IT department does not know how many applications are installed, they may exceed the bandwidth the corporate network can handle. Instead of helping employees work faster and more easily accomplish tasks, a network slowdown due to a lack of computing resources would lead to productivity loss.
  • Security issues: Not knowing about all the software installations throughout the network means not being able to protect each one from threats. The IT team may be unable to keep applications up-to-date and invulnerable to cyber attacks.
  • Wasted spending: The departments that purchase applications think of functionality first and may not prioritize system compatibility. Should the software they bought be incompatible with existing devices, they would be unusable and, therefore, wasted spending. Making them work may require changing computers, which also translates to additional costs.

What Are the Causes of SaaS Sprawl?

Certain company practices, especially among large enterprises, can lead to SaaS sprawl, including:

  • Lack of standardization: While the growing number of SaaS providers gives users as many choices as possible, the volume of available applications can also be overwhelming. Many of them have overlapping features that users may not be aware of. If purchases are centralized, the IT team can provide access to specific functionalities of the same software that one department already has to other teams, depending on their requirements. This method can save companies from purchasing redundant or duplicate apps.
  • Shadow IT: Another challenge companies may face is shadow IT, which occurs when employees purchase or use software without the IT and finance teams’ approval or knowledge. This problem can result in security and compliance issues and wasted spending.
  • Distributed workforces: This issue grew due to the pandemic, which led more companies to offer remote or hybrid working arrangements. As such, they had to invest in home productivity tools, such as videoconferencing and collaboration suites. That could lead to the rapid expansion of SaaS stacks.

How Can Companies Reduce SaaS Sprawl?

Organizations can employ the tried-and-tested procedures below.

1. Application Portfolio Rationalization

Rationalizing your application portfolio refers to the process of assessing which SaaS tools should be kept, consolidated, or retired from operations. It specifically requires you to assess and justify the subscription to every program so the company can gain total SaaS stack visibility and make informed decisions on which software should be retained and which needs to be renegotiated or terminated.

2. Procurement Process Centralization

SaaS sprawl can also be avoided if all software purchases go through the correct channels—the IT department, department heads, or a dedicated procurement team. So, if employees want to start using new tools or suggest changes to existing plans, these should be assessed by those with total visibility of the company’s entire SaaS stack. That would prevent purchases without the organization’s knowledge or consent, often resulting in shadow IT and possibly unnecessary software portfolio additions.

3. Thorough Onboarding and Training Provision

Employees lie at the heart of SaaS sprawl. Educating employees on digital operations can go a long way to prevent unnecessary additions to a company’s existing SaaS stack. Ensuring all staff members get comprehensive onboarding, training, and regular supervision can make them more adept at using company-approved software. If they know all there is to know about the available tools, they are less likely to purchase new ones independently, reducing SaaS sprawl.

While SaaS sprawl can affect any company, there are ways to prevent it.

Key Takeaways

  • SaaS sprawl or software sprawl is a problem that happens when a company’s SaaS stack grows to a large and unmanageable size.
  • SaaS sprawl can cause huge company problems, including productivity loss, security issues, and wasted spending.
  • SaaS sprawl can be caused by a lack of standardization, shadow IT, and distributed workforces.
  • While SaaS sprawl continues to affect an increasing number of companies, it can be avoided through application portfolio rationalization, procurement process centralization, and thorough onboarding and training provision.