SaaS Sprawl Explained: How Decentralized Software Buying Destroys Negotiation Leverage.

Renewal is definitely your biggest opportunity for savings, even in SaaS subscriptions. The problem with renewals in some cases that mind map, they had hundreds of renewals and most of them were on auto renewal. Auto renewal is a big problem for enterprises, right? Because end user doesn't see it. It went on some corporate credit card somewhere and they get an email that says it's up for renewal that they delete and ignore and just auto renews. Right. But you know, that is where your biggest leverage is because it's the opportunity to right size and clean things up. Now it could be anniversary dates, like I said, Adobe is a great example. You can clean up and decrease the anniversary date M365 but renewal is typically the big one where it's like we can do the most impact now. Not always the case like that Adobe one was that I was talking about was renewed last year. They thought they had done a cleanup but they didn't have some of the data that they needed. We implemented the data governance piece that they needed this year and pulled more out of their contract. And we actually think that there's more coming because they're the ones asking us about that Adobe Pro versus Free and we're tackling that next so you can put governance in place to continue down the path. So if they went from say 500,000 to 400,000, maybe to 300,000 a year next year with its next peaks. Right. So it's not just a one and done. A lot of the challenges, organizations sign these three five year contracts and they think the work is done. I say now that the work is just starting. Right. And so instead of using your 90 day renewal windows to evaluate, you know, to evaluate actual uses versus actual use versus projected use, or identify unprovisioned modules or unused modules like in ServiceNow or over provisioned seats, you need to create a performance or negotiation plan that's tied to performance, not just price. Right. Like don't allow ServiceNow to come in anymore and bundle product that you're not gonna use or modules that you're not gonna use in order to get discount over here. Right. That game, you know, all the vendors run the same playbook. You can break it with the right data. And I had a Fortune 100 client to use this approach with ServiceNow where they just said, you know what, we're not playing the game anymore. They eliminated 1.4 million in unused modules and got some other concessions at renewal using their actual Usage data against ServiceNow. That's big and that's what you need to be looking to do. So if I go to, you know, the governance, what I call the governance flywheel, you have to look at all these things. You have to have the intelligence, the ownership, the leverage to get the results right. And the sweet spot is trying to get into the middle of this because sometimes you can have intelligence and get results, but you're not getting as good of result the best results that you possibly could, right? You're going to get some, but not the best. And a lot of the times the problem with organizations is they go and get a little bit of intelligence and they get results or they go and get ownership and they get some results, right? Or they go and get a little bit of leverage and they get results, right? Or they get intelligence and ownership but don't have leverage and can't get results right? So you can kind of see how these all play together, right? But it's like, you know, we had an organization and again, I'll just use a high level example. We had an organization, had a Microsoft EA renewal. It's all about L365 for them. It was 60, 70% of the contract and they had ownership and they went out with a little bit of intelligence and got some results. And what they were able to do was negotiate out about an incremental 5 to 7% at the last minute of the contract. Just pushing on now. We started working with them and gave them intelligence. And in the first year they pulled almost $2 million out of their O365 subscriptions on their anniversary date. This year they pulled another 500,000 out. Next year when the contract's up for renewal again, we've found leverage for them that even their servers and perpetual licenses that they're paying for them have more to come out. So think about that reduction year over year and what that means to that organization and for their budget.