SaaS is growing more rapidly than ever. Look no further than this BetterCloud report to get the picture: 73% of businesses plan to move all their systems over to SaaS by 2020. Apart from showing the growth of the industry, high SaaS adoption also marks a fundamental shift in the way IT is handled at enterprises. While IT was earlier characterized by a central department making implementation decisions for the entire company, the SaaS-powered workspace follows a less structured approach. One could even argue that this decentralized approach is one of the main reasons for its accelerated growth.
It’s important to note, though, that decentralization in SaaS originated organically. Let’s take the case of app ownership. Choosing apps used to be the primary function of IT, but with SaaS it’s usually up to team leaders. This is because SaaS doesn’t need a middle man. It empowers the subject matter experts to quickly test the app for themselves. And this focus on practicality over logistics—combined with relatively affordable subscription plans that can be canceled anytime—allowed team leaders to choose the apps that work best for their team.
But there are downsides
Like every system, SaaS too has its share of concerns that need to be addressed. Blissfully’s 2019 SaaS report states that there are, on average, 32 different billing owners for a medium-sized company. And when one of the owners who purchased a subscription leaves the company or changes roles, that subscription now has no owner. The report also states that organizations spend over $8000 dollars a year on apps that “may or may not be in use.”
Costs are one thing, but we must also take into account the security risk of company data residing on possibly unmonitored applications.
A middle path is needed—one that retains all the benefits of decentralization, but makes sure there are enough checks and balances to keep the system manageable.
Empower department leaders, but create a system of accountability
After looking at the security concerns over SaaS ownership and the potential for wasting thousands of dollars on nothing, it can be tempting to revert back to the single ownership model, but that would mean going back to a scenario where software implementation was chosen by a department that has no insight into how the team actually works. So the decision of which app to use should be left to the department or the team leader because it’s the leaders who have in-depth knowledge of the process and team dynamics, as well as a deeper understanding of the essential workflows required to get the job done.
However, companies adopting SaaS often have no system to govern app usage across teams. While the intention might be to preserve decentralization or empower team leaders, a system that focuses on empowerment without accountability is one that’s destined to fail. The balanced approach would be to completely leave SaaS decisions to team leaders but also hold them accountable for implementation. This way team leaders have skin in the game—an incentive to make responsible decisions while having the freedom to decide what is best for the team.
Focus on building an ecosystem
The sheer number of apps in the modern SaaS-powered workspace can be overwhelming, both in terms of keeping track of subscriptions and for people working with them on a daily basis. But there’s something interesting happening—while more and more SaaS apps are addressing various niches, applications which have been on the market for some time are moving towards a consolidated suite offering. Now we have even more choices, which means even more decisions to make.
In order to assemble a SaaS stack from such a diverse market, we should prioritize building an ecosystem of apps over selecting individual ones. If your goal is to build a network of apps that interact with one another, you’re now looking at implementing SaaS from a solution-centric standpoint rather than an app-centric standpoint.
An important ingredient in the execution of this solution-centric approach is an integration platform. Apart from providing team leaders with the ability to build custom solutions using applications that work the best for their requirements, it helps prevent decision fatigue.
One of the most annoying parts of the SaaS selection process is finding out the app that worked so well for a particular operation can’t be used because it doesn’t support integrations with the other apps you’re already using. With an integration platform, this is something you don’t have to worry about.
Operate under the assumption that change is inevitable
The same Better Cloud report also estimated that a mid-sized company changed 39% of their tech stack in 2017-18. This means almost half of their apps were replaced in a year or less. While it’s beneficial to find a set of apps and stick with them for years, this isn’t really the case in a SaaS-powered workspace. SaaS providers might pivot in a direction that isn’t conducive for your team’s specific requirement. Or you might find that some other app is so much better and more affordable that it doesn’t make sense not to change.
So the apps in your tech stack are most likely going to change. It’s up to each organization to be mindful of how frequent these changes are and that they don’t weaken the ecosystem leading to important data being isolated in multiple apps.
The role of IT in decentralized systems
When choosing and implementing SaaS becomes the responsibility of department leaders, it opens up IT to focus on issues pertaining to cost, security, and compliance. No matter how functional or convenient an application is, it shouldn’t be chosen if it doesn’t comply with your security and regulatory standards. IT can ensure that this doesn’t happen by doing periodic audits of the apps being used by each team. They can also lay out proper guidelines for department leaders, to make sure that non-compliant apps aren’t chosen in the first place. IT can also ensure that there aren’t any active duplicate subscriptions, and if a particular implementation works exceptionally well for a team, IT can suggest it to other departments.
When you have a department that manages and empowers decentralization instead of eliminating it completely, it creates a healthy environment for teams to operate under—and what’s healthy for the teams is healthy for the organization.