This year may officially be called the year of the shelfware explosion. New, better tools are coming out every day, people are working from home, all while businesses are buying more SaaS just to increase productivity.

Kleiner Perkins and its annual Internet Trends report, essentially the state of the union for technology, acknowledges this in a look at the relentless march of digital tools in technology companies today. You can also see how departmental spend increased since 2016 based on our 2019 The State of Business SaaS Spend which is another scary data of how enterprises buy.

SaaS Spending trends by Department or Business Unit in 2019 increases business risks
Enterprise SaaS spending trends are showing great increase each year especially in marketing and sales department.

Shelfware in marketing

Corporate reliance on apps is at another level. Marketing departments are among the worst offenders, regularly exceeding 90 deployed cloud services. Consider that for a moment: your marketing team may have nearly triple digit applications at a given time.

Impossible! marketers will protest. Business leaders may even raise a skeptical eye.

But trace the workstreams and one quickly understands the usage level, conscious or not, of cloud tools departmentally.

Consider notable martech influencer blog ChiefMartec.com and its probe of the marketer’s software use journey, below:

At the top of the pyramid, there are applications that we naturally think of as “marketing software” such as CRM (probably with extra “apps” installed), marketing automation, web analytics (likely several), your website CMS, possibly a separate blog system like WordPress. If you’re using WordPress, how many plugins do you have installed? Each one is small software program.

...perhaps you’re running little scripts (i.e., software) for A/B testing, mouse tracking, social sharing, personalization, live chat, discussion threads, feedback surveys, calling tracking, ad retargeting, etc. — possibly all coordinated through a tag management system.

Ever run an SEO audit or a security analysis on your website? More software.

Maybe you have software for content marketing management and social media management. There’s software you run for digital advertising — perhaps a DSP and a DMP, a keyword research tool, click fraud detection, but maybe just direct ad placement services (again, software) on Google, Facebook, LinkedIn, Twitter.

Audience research services (i.e, software) like Comscore and Nielsen?

Maybe a marketing resource management (MRM) or digital asset management (DAM) system.

But then there’s all the marketing software products you run locally on your computer to do marketing tasks, such as Excel, Word, PowerPoint…

A calendar app. Your email software. Image and design software, such as Adobe’s creative suite. Software for recording and editing videos, screencasts, podcasts. Software for hosting your own video conferences and webinars — and multiple client programs for accessing other people’s. Software like Box or Dropbox for file sharing.

Cue the finance and IT leaders’ audible gasps as comprehension of triple-digit program usage sinks in. So let's explain the basics and see what you can do about it.

What is shelfware?
Shelfware is a slang term used in the corporate world to describe software (SaaS) that is not used by anyone with the whole purpose just to sit there, either by leaders knowing or not.

Why does shelfware even exist?
Shelfware exists because enterprises buy software (SaaS) in volume to obtain a discount that is connected to the number of licenses or seats to use it.

Shelfware consequences

Below, are three key areas of concern that the accelerated presence of shelfware in today’s business raise.

Productivity takes a hit

report by Forrester showed that 56% of business and IT leaders feel apps require significant training, and 45% thought employees only leveraged a few features.

Getting employees on-boarded, trained and proficiently using available software takes time and cash. Productivity is correlated to proficiency. And when employees are trying to adopt software into their work, leverage features and stay apprised of updates, they are being distracted from the actual value-added deliveries they are employed to make!

Missed cost savings

Without central management of SaaS applications, teams are individually vetting, negotiating and procuring software. While there needs to be flexibility for particular teams and use cases, in general, this is concerning. These individuals are not positioned to have a strategic purview of a SaaS’ usefulness across an organization. They haven’t benchmarked usage or solicited competitive bids to effectively negotiate pricing or optimize license volume needs.

Similarly, they are often siloed from other departments who have already vetted or procured software for a particular use. This drives issues ranging from incompatibility to missed volume discounts – all ultimately impacting the bottom line.

Last year, Gartner Research published a report suggesting business can cut software spending by as much as 30% by implementing some license optimization best practices. Given software reductions’ immediate benefit to gross profit, this is welcome news. And especially so given the report’s recognition that businesses will have spent $332 billion on software by year’s end.

The rise of security insecurities

Perhaps the most striking point from the Internet Trendsreport is that surrounding security. The report cited cloud security company Netskope and its Cloud Confidence Audit, an objective measure of security, compliance, auditability and business continuity. The report’s finding: 94% of all apps are not “enterprise ready”.

SaaS deployment growth gives rise to increased vulnerability. And this is especially true when employees, teams and departments are actively procuring software on their own.

It is not easy to keep hundreds of apps updated and monitored; sooner or later security lapses will occur. Consider the Equifax breach that dominated headlines after hackers accessed the data of 143 million customers in May. Poor press, compromised contracts, customer abandonment – the impacts of the breach are literally catastrophic.

Wired Magazine’s take:

Equifax has confirmed that attackers entered its system in mid-May through a web-application vulnerability that had a patch available in March. In other words, the credit-reporting giant had more than two months to take precautions that would have defended the personal data of 143 million people from being exposed. It didn't.

Without excusing the disaster, the situation points to the reality: the more applications organizations run, the more significant the maintenance and management effort required. When administered appropriately, SaaS and software license growth may be executed well. But the shelfware explosion we are witnessing will likely over-stretch already overtaxed systems and staff.

How can Cleanshelf help?

Cleanshelf helps eliminate these issues by monitoring and reporting on shelfware and other SaaS subscriptions. By allowing businesses to clearly see what they’re spending money on, the volume of usage and location of deployments, companies can capture the productivity, security and financial benefits associated with a license management process.

Consider Cleanshelf’s off-boarding functionality (pictured above), for example. Customers can quickly review and deactivate services for employees who leave the company. Tracking and managing licenses during off-boarding is one of the simple tools that Cleanshelf offers to help manage shelfware creep. License re-allocation and cancellation are critical factors in reducing costs and ensuring optimal license deployment sizes.

By taking advantage of this, and other Cleanshelf SaaS management functionality, IT administrators and finance leadership can ensure prudent and secure usage of SaaS tools across the entirety of their companies. If you’re a prospective or current customer interested in putting a shelfware solution in place at your company, contact us today.

Ready to start controlling your enterprise SaaS?

Get Demo

0 Likes

About Cleanshelf

Cleanshelf is the leading enterprise SaaS management platform focused on tracking, controlling, and benchmarking SaaS applications. Their SOC 2-compliant and AI-powered technology helps companies save up to 30% on their SaaS spending by automatically identifying unmanaged contracts, duplicate licenses, and wasted cloud software subscriptions. Based in San Francisco, Cleanshelf provides an enterprise-grade solution to over a hundred clients, including Hilton, Looker, and CoStar Group.

Comments (0)