Remember when you had to install software to use it? Those were simpler times. Better yet, users needed administrator rights to install new software, so you never had to worry about the use of unauthorized applications in business.

Today, SaaS adoption is so widespread that any employee with a browser and a credit card can add new tools to your environment. As of 2025, this ease of access has brought convenience but also complexity. With remote work and distributed teams now a permanent fixture, securing and managing who uses what has become a full-time function. The benefits are undeniable.

SaaS solutions have transformed how businesses work and grow, automating many manual processes that previously took hours to complete. However, without proper management, these tools can quickly become a security and compliance nightmare. You may also incur unnecessary costs maintaining apps and licenses that are no longer in use.

In this post, we’ll look at how you can leverage SaaS user management to discover unmanaged tools and users, as well as curb SaaS sprawl. We’ll also discuss the challenges you’ll have to overcome and best practices for simplifying the SaaS user management process.

What is SaaS user management?

SaaS user management is the process of managing and controlling how employees access SaaS tools in your business.

This responsibility used to fall only on large enterprises with global teams and strict regulations. But after the 2020 shift to remote work, even small businesses now rely heavily on SaaS tools. Now, in 2025, the line between IT and business users is increasingly blurred, making user governance a must-have across all company sizes.

However, all this changed during the COVID-19 lockdown, when many businesses were forced to implement work-from-home strategies. The use of cloud solutions among startups and SMBs exploded — and has only been rising since. It’s predicted that 99% of companies will be using at least one SaaS system by the end of 2024.

Proper SaaS user management helps organizations maintain operational efficiency, reduce security risks, and meet growing regulatory demands. Whether you manage 10 tools or 100, this function plays a central role in ensuring smooth, secure digital operations.

SaaS user-management task checklist

These seven steps are the foundation of every effective SaaS user-management process:

1. Identify all the SaaS applications currently in use in your business.

2. Implement secure authentication mechanisms like single sign-on (SSO) coupled with multi-factor authentication (MFA).

3. Define permissions for each application. Use the principle of least privilege (PoLP) to ensure that users have only the access and permissions necessary to perform their roles.

4. Create a user account for new users to ensure that they can quickly access any application when they need it.

5. Delete user accounts when a user no longer needs access to a SaaS tool.

6. Monitor and log SaaS user activity and access — this will help identify underutilized SaaS apps and licenses.

7. Conduct regular access reviews and audits to help with security and compliance to SOC 2, ISO 27001, HIPAA, and other standards.

Currently, these tasks are no longer optional but are expected by auditors and investors alike. Businesses that operationalize these tasks through repeatable workflows gain more control, reduce risk, and are better positioned for scale.

The importance of SaaS user management

If you’re looking to sell the idea of SaaS user management to relevant stakeholders — or those just not convinced of its importance — here’s how different departments can benefit from formalized management of SaaS users:

Information security: Stay secure and compliant

According to the 2023 Verizon data breach investigation report, 22% of security incidents are insider threats — including former employees who retain access to an organization’s SaaS apps. Keeping track of user accounts and SaaS access ensures that employees are promptly offboarded after leaving the company.

Now, regulators expect businesses to enforce strict access controls and maintain audit trails. Managing SaaS users systematically allows your security team to align with ISO 27001, SOC 2, and GDPR requirements. Without these practices, you're leaving compliance — and your data — to chance.

IT department: Visibility into who’s using what

IT is no longer the sole authority when it comes to choosing the best software solutions for the business. That’s the unfortunate truth. However, this should not be an excuse for running SaaS applications without IT oversight.

Modern IT teams in 2025 must act as stewards of digital governance. With SaaS user management, IT regains visibility and influence over the tech stack. They can enforce security, optimize integrations, and eliminate redundancies, even if they aren’t the ones picking the tools.

HR department: Streamlined onboarding and offboarding

By maintaining up-to-date information on SaaS apps and users, HR will have the information they need to ensure that new employees easily gain access to the apps they need for their roles. Depending on the system in place, HR may also initiate the user account provisioning — or forward the request to the relevant party.

A well-integrated SaaS user management system builds trust between HR and IT. In 2025, HR professionals are increasingly expected to support digital onboarding and offboarding processes. Automating these flows protects sensitive data and gets new hires productive faster.

CTO: Informed decision making

Well-executed SaaS user management gives CTOs the data they need to decide whether to add a new tool or remove an existing one. More importantly, it enables them to easily strategize how these applications can be integrated to improve business efficiency and achieve organizational goals.

CTOs are now responsible not just for innovation but also for governance. Clean SaaS user data supports smarter architectural decisions, making it easier to build scalable, secure digital environments.

Finance: Budgeting and spend optimization

Implementing SaaS user account management can help identify cost-saving opportunities — for example, two applications that have overlapping functionalities, or paid licenses for inactive users. By comparing SaaS usage with associated costs, finance can also easily determine whether apps provide value for their money and decide whether to cut or retain them.

In today’s tighter economic climate, Finance teams are scrutinizing software spend more than ever. SaaS user data gives them a clear map of waste and value, helping guide renewals, consolidations, and budgeting decisions with confidence.

Challenges in SaaS user management

Here are the challenges you’ll need to overcome to achieve efficient SaaS user management in your business:

• Shadow IT. As we’ve discussed, IT is no longer in complete control of the apps that are adopted in the company. That’s why the first step in access management should be identifying all the SaaS apps being used in your organization. However, to really solve the problem, you’ll need to develop a strategy to deal with shadow IT, so that any new SaaS app introduced into the business has IT oversight. 

• SaaS sprawl. As with shadow IT, you’ll need a strategy to curb SaaS sprawl. Users won’t be happy that their preferred tools are getting cut, but having different tools doing the same work is just unnecessary management work.

• Managing access and permissions. Assigning employees the right access and permissions may sound easy, but it’s an intricate process that requires careful planning. Incorrectly configured access controls expose resources to unauthorized access.

• Compliance and governance. When implementing SaaS user account management, you also need to consider compliance requirements. Catalog all the regulations that apply to your business; then devise and document detailed access management strategies  that address each specific regulation.

• The SSO tax and complex setup processes. Standard identity and access management tools like Okta require SAML and SCIM protocols to connect with your SaaS applications. Unfortunately, most SaaS vendors support these protocols only on their enterprise plans — which means you’ll need to upgrade your license. The process is also technical and requires specialized skills to implement. The good news is, there are other great alternatives that let you manage user access without the extra cost or technical setups.

The process is also technical and requires specialized skills to implement. The good news is, there are other great alternatives that let you manage user access without the extra cost or technical setups.

SaaS management best practices

While SaaS user management has its challenges, there are ways to simplify the process. Here are our top four tips:

1. Establish clear user access policies by defining roles, access, and permissions. Take your time with this, as it will lay the foundation for other access management automation.

2. IT collaboration with the other departments. The team using certain tools tends to know them better than IT does. Their insights will be invaluable when developing access policies. You can also delegate some management tasks — such as approving new access requests — to them.

3. Leverage SSO and MFA. SSO creates a central point of access — which is easier to manage than having people using different authentication methods.

4. Make use of SaaS user management tools. One of the best decisions you can make when it comes to SaaS user management is to use a dedicated SaaS user management tool to automate some of the processes. We cover this in more detail below.

These practices are not just helpful; they’re table stakes for secure, scalable operations in today’s cloud-first environment.

Manual SaaS user management vs. automated SaaS management

Every company manages its SaaS users the same way at the beginning: spreadsheets.

This approach works early on, but as teams grow and tools multiply, spreadsheets quickly become unmanageable. In 2025, the cost of errors — like failing to offboard a former employee — is too high to rely on manual processes.

Automation brings consistency, auditability, and efficiency. For growing businesses, shifting from spreadsheets to platforms is the natural next step in maturing your SaaS strategy.

While it absolutely works, it’s also cumbersome and prone to error. As your business continues to grow, things will only get more complicated. That’s why many businesses opt for a dedicated SaaS management platform. 

Advantages of a dedicated SaaS user management solution

What are the benefits of using a SaaS user management tool rather than spreadsheets?

1. Automation saves you hours of manual work. To start with, a SaaS user management system will automatically discover all SaaS applications and user accounts that are in use in your business. Moreover, it lets you set up workflows for automated access approvals — as well as automatic account creation, modification, and deletion. And all of that is on top of the incredible ease of generating audit reports. 

2. Centralized user control for multiple SaaS tools. A SaaS user management platform acts as a single source of truth for SaaS apps and user account information. It’s not just for access management — you can also use it to track SaaS subscriptions and renewal dates.

3. Scalability and flexibility. A SaaS user management platform easily integrates with other SaaS services and simplifies the addition of new users and applications.

Conclusion

If you take away one thing from this post, it's the importance of having a SaaS user management process. It doesn't matter if you do it manually or through an automation tool. Initially, you must do it manually to identify the gap for automation.

By defining roles, permissions, onboarding procedures, and offboarding protocols, you'll understand the type of tool you need instead of just choosing what's popular in the market.

SaaS user management is a critical enabler of security, compliance, and operational agility. In 2025 and beyond, it is no longer optional — it’s foundational.