New research shows SaaS spend per employee is topping $13K annually. U.S. enterprises with 800 employees spend $15 Million on SaaS to power their business. Of that spend, up to 30% is wasted, in part due to the complexities of SaaS pricing and the lack of control over the growing SaaS stack
Cleanshelf, the leading SaaS spend optimization solution just published its annual The State of Business’ SaaS Spend infographic which finds that the role of SaaS in organizations continues to rise. SaaS spend per employee has increased 164% over the last four years and now already stands at $13K. However, up to 30% of SaaS spend is wasted, requiring a new approach to data-driven SaaS vendor management and spend optimization.
“Companies are committing more budget to SaaS each year. Organizations now have dozens or even hundreds of cloud tools in their SaaS stack,” said Dusan Omercevic, CEO at Cleanshelf. “What CFOs and CIOs need to understand is whether the deployed cloud apps are driving the expected ROI.”
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The State of Business’ SaaS Spend 2019 infographic reveals U.S. organizations with 800 employees are now spending $15M on SaaS, up 28% in comparison to 2018. Key findings include:
- The typical employee uses 44 apps to do their job. Seven are never used.
- The annual SaaS spend per employee totals to more than $13K. Almost $4K is wasted.
- The typical 800-person U.S. company is paying to 141 SaaS vendors. More than $4M could be saved annually.
“SaaS has infiltrated businesses down to every individual and has become critical for collaboration and business success. All departments within companies rely on SaaS to power their day-to-day operations, which is especially interesting,” adds Patrick West, Head of Solution Engineering at Cleanshelf and co-author of this research. Sophisticated software is not limited to IT, sales and marketing, as we’ve seen historically. Finance, HR, legal, and other departments are seeing a notable increase in SaaS usage and spend as well.
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The benefits of SaaS are straightforward. However, SaaS spending quickly becomes a compounding issue that is often overlooked. Up to 30% of companies’ annual SaaS spend is wasted, the report finds. For a typical 800-person U.S. company this translates to more than $4M lost in a year. Businesses can no longer neglect SaaS management – it has become strategically important for their growth and bottom line.
The research, conducted by the Cleanshelf research team, analyzed the patterns of scaled app management and SaaS license and spend optimization. What is more, it revealed significant intelligence shedding light on the strategic importance of both visibility and accountability of cloud tools for finance and IT leaders. Although a growing and compounding issue, wasteful SaaS spending can be quickly solved when given attention and internal dedication.
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