Key Takeaways
- SaaS sprawl arises from easy self-registration and decentralized budgets.
- A typical consequence is multiple tools with the same function across different teams.
- Unlike Shadow IT, the applications may be known individually.
- A complete software inventory is the first step against sprawl.
How does SaaS sprawl arise?
SaaS sprawl arises because new tools are added faster than old ones are retired.
- Sign-up via email and credit card in just a few minutes
- Free trials that convert into paid subscriptions
- Budgets held by individual teams rather than centrally
- No responsible owner assigned per tool
- Projects end while subscriptions keep running
What are the consequences of SaaS sprawl for small and medium-sized businesses?
SaaS sprawl costs money and complicates security and offboarding. Multiple tools for the same task cause duplicate costs, data is spread across many providers, and when an employee leaves, nobody knows exactly which accounts need to be closed. Without an IT department, this often only becomes apparent during a cost review.
How can SaaS sprawl be curbed?
SaaS sprawl can be curbed with transparency and clear responsibilities.
- Automatically record all used apps
- Assign a responsible person to every tool
- Consolidate tools with the same function
- Onboard new tools through a short approval workflow
- Review contracts before every renewal
Example: SaaS Sprawl in practice
Example: During an inventory review, a media company with 95 employees finds 87 paid SaaS applications, including four project management tools and three survey services. After consolidation, one tool remains per task, leaving 61 subscriptions in total.
SaaS Sprawl vs. Shadow IT
| Aspect | SaaS Sprawl | Shadow IT |
|---|---|---|
| Core problem | Too many overlapping subscriptions | Lack of awareness and alignment |
| Scope | SaaS applications | Devices, software, and cloud services |
| Visibility | Apps may be known but uncoordinated | Services are unknown |
| Main risk | Costs and duplication | Security and data protection |
SaaS sprawl describes the uncoordinated proliferation of subscriptions, whereas Shadow IT describes the use of IT that is unknown to those responsible.
How does Sovaro help with SaaS Sprawl?
Sovaro captures used apps via the Sovaro Agent and the browser extension, even without SSO, and uses AI to match invoice line items to the right app. This puts all apps with their costs, contracts, renewals, and notice periods per subscription into a single overview. Which tools stay is decided by the team.