As software expenses continue to rise, accounting departments are faced with the daunting task of managing these investments effectively. In a recent webinar, Jason Parker of FinQuery dives deep into the critical importance of effective software management in today’s business landscape. With software expenses, particularly in the SaaS space, becoming a larger portion of business budgets, organizations must prioritize proactive strategies and processes to manage these investments effectively.
The Growing Importance of Software Spend Management
Parker begins by discussing the rapid growth of software spend, particularly in the SaaS space, and the need for businesses to prioritize effective management strategies. As he points out, “Finance, of course, is responsible for making sure that the money spent at an organization returns the commensurate value that you’re looking for. So if I’m a finance professional, I want to make sure I have visibility into spend across the organization.”
Effective management is increasingly critical, with software expenses becoming a larger portion of business budgets. Organizations must understand and optimize software spend across various departments and functions to ensure investments align with business goals and deliver value.
The Challenges and Risks of Limited Visibility
One of the biggest obstacles to effective software management is limited visibility into software investments. Parker explores the challenges and risks associated with this lack of transparency, including:
- Siloed decision-making
- Complex contract structures
- Inadequate understanding of software usage
These factors can lead to suboptimal renewal decisions, security risks, and wasted resources. Companies need to adopt a cross-functional approach and centralized processes to mitigate these risks and navigate the complexities of software management.
The Path to Optimization: Data-Driven Strategies and Processes
So, what can companies do to optimize their software investments and drive long-term success? Parker outlines several key strategies and processes, including:
- Centralizing contract management
- Automating IT processes
- Making data-driven purchasing decisions
As he emphasizes, “You want to be intentional about this. You got to make sure that what you’re using these tools for is solving the intended problems.”
Another crucial aspect of effective software management is measuring success through metrics like subscription spend per resource and license utilization rates. Parker notes, “What we see today is that almost every business is overspending on software because they don’t have the information they need to make the best decision. Managing that subscription spend per resource is important because just about every business out there can reduce that spend and obtain even more value in their investments.”
By adopting these data-driven strategies and processes, companies can optimize their software investments, mitigate risks, and ensure their investments align with business goals and deliver value.
The Bottom Line: Prioritizing Software Asset Management for a Thriving Company
In an increasingly software-driven world, effective software management is no longer a nice-to-have but a critical imperative for companies seeking to thrive. As businesses become more reliant on technology, companies prioritizing cross-functional collaboration, centralized processes, and continuous optimization will be best positioned to navigate the complexities of software management and drive long-term success.
By adopting the strategies and processes outlined by Parker, companies can optimize their operations and better serve their clients in navigating the complexities of the digital landscape. To learn more about how your firm can master the art of software management, be sure to watch the full webinar recording.