Trimming the fat in cloud and SaaS spending

Trimming the fat in cloud and SaaS spending

A recent study revealed that 50% of companies are wasting more than 10% of their budget on software, SaaS and cloud infrastructure purchases.

Published on 15th February 2023

In today’s world, cloud and Software-as-a-Service (SaaS) are fundamental to companies’ IT infrastructures. As a result, the cloud’s share of the overall IT spending is increasing. Yet, many companies are struggling to see the return on investment.

Oomnitza’s 2023 Snapshot Survey: SaaS and Cloud Spend Optimization & Automation, a YouGov study, revealed that 50% of companies are wasting more than 10% of their yearly budget on software purchases, SaaS, and cloud infrastructure.

YouGov surveyed 213 senior IT professionals to explore the need for better SaaS and cloud resource management, governance, and process automation. Respondents from large enterprises (more than 5,000 employees) were twice as likely to experience significant (30%) software and SaaS spend management issues than their smaller peers (less than 5,000 employees).

The survey results also revealed that nearly one-third of companies squander 10-20% of their yearly application investments on unnecessary SaaS and software subscriptions and mismanaged licenses.

“Anyone with a credit card can spin up resources. That’s great for adoption and ease of access, but it’s also a recipe for overspending. Cloud instances that, for whatever reason, become abandoned can keep racking up charges for underlying compute, network and storage resources. Effective process automation capabilities add much needed control and optimization of SaaS, software and cloud investments,” said Valerie O’Connell, research director at EMA.

While many businesses have already set up automated processes to manage SaaS and cloud usage, the survey showed that the majority (54%) only assessed their workflows for governing allowed use and licensing of SaaS applications or cloud infrastructure as “satisfactory.”

As a result, 9% of companies said they experienced unexpected expenses and financial limitations due to the lack of maturity in their process automation.

Implementing SaaS management

To cut expenditure waste, Oomnitza suggests a comprehensive process automation solution. Automating SaaS and cloud processes can help organizations to reduce security exposures, eliminate wasteful spending, and improve utilization.

Automation can help to discover which apps are managed and unmanaged and categorize them by function and business unit. It can also help the IT teams to understand user roles, licenses, and contract assignments; enforce security policies for apps; track adherence to usage patterns and user access metrics. They can also ensure license compliance to avoid over-provisioning and automate workflows for onboarding and offboarding apps.

“This research serves to offer greater insight into quantifying the amount of software, SaaS and cloud expenditure waste. It also underscores the need for enterprises to mature and expand their IT process automation capabilities to improve operational efficiencies. We’re living in an era where IT has to do more with less, and that cannot be accomplished with manual ticket-based processes,” said Arthur Lozinski, chief executive officer and co-founder of Oomnitza.


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