The SaaS Tax
SaaS has revolutionized software delivery by eliminating large upfront licensing costs and enabling rapid implementation. However, it has also created a new problem: the SaaS tax. Companies optimize for implementation speed rather than long-term cost management. Teams buy point solutions to solve immediate problems without considering integration, duplication, or total cost of ownership.
Licenses accumulate because no one tracks them systematically. Users don't adopt because they weren't involved in the selection process. The result is that the average mid-market company wastes 25-40% of its SaaS spend on unused, underutilized, or redundant licenses.
"For a 500-person company spending A$1.2-1.4M annually on SaaS, this waste totals A$300-560K per year."
This is not a small number. This is real money that could be reinvested into strategic initiatives, customer value, or profit. Yet most companies leave this money on the table because tracking and consolidating SaaS is tedious and requires cross-functional coordination. DSV's SaaS Rationalisation service brings discipline to this problem.
What You Get
A concrete, actionable set of assets that quantify waste and provide a clear path to cost reduction.
SaaS Audit
Complete inventory of all SaaS subscriptions, including vendor, cost, users, utilization, and contract terms. This inventory alone is valuable because most companies can't articulate what they're paying for.
Utilization Analysis
Assessment of usage by application, department, and user. Identifies which applications are highly used and which are severely underutilized.
Duplicate & Redundant Analysis
Identification of overlapping functionality across multiple applications. For example, you might discover three different tools that do project management.
Build vs Buy Analysis
For applications where you have significant custom requirements, analysis of whether building a custom solution is more cost-effective than buying SaaS.
Consolidation Roadmap
Recommendations for which applications to consolidate, which to eliminate, which to enhance adoption of, and which build-versus-buy decisions to prioritize.
Implementation Plan
A phased approach to executing consolidation, including migration strategy, change management, and timeline.
Financial Model
Quantified cost savings by action (eliminating redundancy, consolidating vendors, optimizing licenses), total annual savings, and payback period.
Healthcare SaaS Rationalisation:
From Sprawl to Strategy
The Challenge
A healthcare organization with 2,000 employees across 12 locations was struggling with SaaS cost management. Each department had purchased point solutions to solve immediate problems. Some applications were duplicative. Some were severely underutilized. The organization lacked visibility into what they were paying for.
Current State
Audit revealed 62 SaaS subscriptions costing A$1.8M annually. Usage analysis showed that 19 applications (31%) had minimal usage (fewer than 5 active users per month), and 6 applications duplicated functionality.
What DSV Did
Conducted detailed utilization analysis. Identified that 41 applications could provide the same coverage. Recommended consolidating 62 apps to 41, and analyzed custom build options for unique requirements.
The Results
By consolidating vendors, eliminating underutilized applications, and improving adoption of core platforms, the organization achieved a 16% reduction in SaaS spend. Consolidation improved data integration and user experience with minimal disruption.
Engagement Timeline
Complete SaaS inventory and spend analysis.
Utilization tracking and duplicate assessment.
Consolidation recommendations (2w) and implementation planning (1w).
Build vs Buy Shift:
Why the Economics Changed
The build versus buy decision has fundamentally shifted in the last 3-5 years due to AI-accelerated development. Historically, building a custom solution was expensive (6-18 months, six-figure budget, ongoing maintenance).
Buying a SaaS solution was cheaper and faster (weeks to implement, lower TCO, minimal maintenance). This was the obvious choice for most problems. Today, AI has changed the build equation.
With AI-assisted development (GitHub Copilot, Claude, other LLMs), a small team can build a custom solution for a specific problem in 4-8 weeks for 20-40% of the cost of a SaaS solution.
This means the build versus buy decision has become much more nuanced. Some companies are reconsidering whether they should continue paying SaaS premiums for generic solutions or build tailored solutions that fit their specific needs. Our SaaS Rationalisation service includes build-versus-buy analysis for your key platforms, helping you make optimal decisions.
When to Build vs Buy
The Evaluation Framework
Build If
The functionality is highly specific to your business, buying requires significant customization or integration work, and a small team can build a tailored solution in 4-8 weeks. Payback period is less than 18 months. You have internal capability or can hire it.
Buy If
The functionality is generic and applies across many companies, implementation is straightforward, adoption is strong, and SaaS cost is lower than build cost when accounting for total cost of ownership. You don't have the internal capability to build and maintain the solution.
Hybrid If
The core functionality is best sourced through SaaS, but you need custom integration or augmentation. This is increasingly common: buy the platform, build the integration and customization layer.
Frequently Asked Questions
The BPR Connection
SaaS Rationalisation is most effective when combined with business process reengineering (BPR). Broken processes create demand for more SaaS point solutions. When you reengineer processes, you often discover that you can consolidate SaaS platforms because you no longer need multiple tools to work around process issues.
This is why many clients conduct BPR first, then SaaS rationalisation. The result is cleaner processes and simpler, more efficient technology stacks.
Explore BPR Services