How to manage SaaS subscriptions: Dealing with automated renewals

Automated subscriptions renewal offers the convenience of uninterrupted service in case the renewal date has been forgotten. But, a drawback that is valid particularly for large organizations, is the chance of getting the license renewed by mistake - due to lack of clear records on renewal terms, forgotten renewal data, etc, leading to unnecessary costs.

Large organizations are on average renewing 2 or 3 licenses per day. And if these licenses are part of shadow IT - i.e are not centrally managed by the IT department - they can incur increased costs and uncontrolled risks. How to efficiently manage SaaS subscriptions and handle automated renewals, then?

Tips on how to manage SaaS subscriptions and avoid unwanted renewals

Collect information about the renewals

To avoid unwanted renewals, it is important that you store the complete renewal details of each SaaS subscription, including notification period. There is no universal notification date and that may range from one day before renewal to 365 days upfront. Carefully examine the SaaS license agreement terms to identify the exact notification period, renewal date, price and other details. Make sure you are reviewing the latest agreement terms since those may change at times of upgrade, renewal or when important changes to the agreement have been introduced. Collect also information about the subscription such as users of this SaaS tool, features used, history of upgrades applied, etc.

Based on the information obtained, set up SaaS renewal slots in your schedule so you can perform a detailed review of the tool usage before actually renewing the subscription.

Perform renewal audit based on priority

If numerous SaaS tools are pending for renewal audit, you may need to prioritize the reviews. Start from the tools that are about to renew the soonest, or the ones that make a bigger share of the SaaS spend.

Identify the level of usage of each tool to be renewed

When auditing the tool to be renewed, take a look at the actual usage of the tool based on the last login date. Examine the last login within the past 30 to 90 days and identify whether or not there has been any login activity for this application. The answer you get will definitely help with taking a decision of whether or not to renew the tool. Typically, if no login occurred within the past 30 days, you may consider the license for removal or reallocate it to other users.

Deeper analysis into the actual usage of a tool upgrade features may support the decision of whether or not an upgrade package should be renewed. Check out any statistics on the usage of features which are part of the tool’s paid packages. If you find out that upgrade features do not actually get used, consider downgrading to a lower package to save unneeded costs.

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Collaborate with your team on renewals

Purchasing SaaS tools is no longer confined within the IT department only. The teams, individual employees and business structures within an organization are now signing up the majority of the SaaS inventory used. This results from the need to be flexible and move fast, from the shaping of specialized verticals within the organization and the very easy onboarding and upgrade of SaaS tools. With a vastly distributed SaaS spend, renewal information can be difficult to obtain. This leads to a big share of unknown and unplanned renewals.

Hence, it is a must for IT departments to take control over renewals by summarizing the available SaaS stack data, including information on upcoming renewals, and then collaborate with the teams and employees within the organization to keep this data current in the long run.

Set up a reliable license review and approval process

Having a license review process in place would definitely help with managing new SaaS purchases and renewals. By requiring approval for each new software purchased, it would be easier to document and track the SaaS spend, and hold software renewal audits on a regular basis. 

It is a good practice to assign a team of representatives from the IT, legal, finance and procurement departments to carry out the license review process,  so they can approve the spend based on the business goals of their team. A centralized record of all approved SaaS licenses should then be maintained by an appointed person from this review team. Such tracking, initiated at the time of the license approval for purchasing, is much easier to perform compared to tracking after the SaaS tool has already been signed up for.

Efficiently manage the SaaS subscription renewal process

Establishing reliable control over the SaaS renewals requires maintaining a good documentation, regular monitoring and planning. Having a SaaS management platform like Viio in place, can help your organization to easily discover and audit the SaaS stack used, put an end to surprise software renewals and reduce unnecessary SaaS spend. Find out more about how Viio can help to manage your SaaS stack - in a personalized demo.