HYBRID IT - BEAMY

The European SaaS and cloud computing market is forecast to multiply from 53 billion in 2020 to 500 billion in 2027. SaaS platforms are becoming increasingly useful in optimising business processes and helping employees manage workflows. The growth of the SaaS market is reflective of the newfound reliance upon SaaS within organisations. Though the access to a wide range of tools for employees is promising for efficiency and productivity, it also creates difficulties for CIOs who manage IT systems. An insufficient management of SaaS can lead to major cyber and compliance risks, which pose an existential threat to businesses.

The SaaS explosion and pandemic-driven digitalisation

It is well established that the COVID-19 pandemic forced companies to rethink their workplace operations and accelerate their digital transformation. According to a report from McKinsey, COVID-19 sped up digital advancements by seven years, completely transforming how businesses operate. As a result, the number of tools on the market to serve the world of remote or hybrid working have also increased.

The adoption of SaaS platforms has had huge growth since the start of the pandemic. A reason for the influx of SaaS adoption is that the agile and hybrid nature of SaaS matches the hybrid style of work, which many companies adopted during the pandemic. Beyond the pandemic, the future forecasting of the industry is predicting huge growth, with the market value to reach $168.6 billon in 2024. While digital transformation was accelerated by the pandemic, it has taken on a life of its own. 

There is now a plethora of SaaS applications available to employees, with different uses and price points. Employees can download any software across several devices, this means multiple downloads of the same software, and multiple costs or payment plans. However, with employees bound in hybrid work settings, CIOs have less control over how these applications are onboarded and managed.

Hybrid working gives employees more autonomy, allowing them to choose their preferred SaaS applications for completing tasks. There is clear evidence that today’s workforce is demanding more control over how they accomplish tasks. Having access to a wide range of tools creates a decentralised model for IT systems, in which technology needs are self-defined by employees. For example, low-code applications can empower employees less proficient in IT to perform tasks at similar levels to their peers with little effort or in-depth knowledge. The democratisation of this process, while advantageous for team productivity and innovation, can also pose several risks to the infrastructure of businesses. Companies cannot build their own solutions to these issues with a one size fits all approach, they must adopt dedicated tools which have been created outside of their internal IT departments.

The risks of hybrid IT and unmanaged SaaS tools

In the average large enterprise, IT is only aware of around 40 out of 200 software apps being used by employees. Fifty percent of apps used are neither known or managed by IT teams or CIOs. Often referred to as shadow IT, the lack of any governance over the software can cause huge problems for a business.

This unregulated use of SaaS platforms can lead to security and data risks, as well as additional software costs. Shadow IT can also lead to disruption in the digitisation process, due to a lack of data backups on these platforms. Without an effective data recovery strategy in place, data may be lost, and time wasted.

Adopting cloud software may result in highly confidential data being leaked or stored in non-compliant ways. On top of this, more than 45 percent of SaaS is American, so the data being extracted may be hosted outside of its originating area. This can create a gateway for future vulnerabilities in security and looming compliance issues. While this is a huge data protection problem for the organisation, it can also reveal thousands in costs which could have been avoided.

Often viewed as a threat to businesses, shadow IT creates uncertainty amongst employees over the use of IT tools. However, under the right governance, it can help speed up the digitisation process.  Businesses should look to empower employees to digitise safely and effectively support their desire to make their work more efficient.

Solutions to managing and embracing workplace digitalisation

Companies must accept that the rising tide of SaaS platforms is unavoidable due to the ever-growing digitalisation of the business landscape. Luckily, the explosion of SaaS isn’t a bad thing, as there are many new tools and approaches to SaaS management. This means companies can have the best of both worlds. By embracing digitalisation, they can simultaneously embed a reliable governance and management framework into their IT systems to avoid any risks. By using AI technology which continuously monitors servers, there is more visibility to govern the entire IT ecosystem and locate any threats before they become an issue. Digital evolution is fast moving, so all departments of an organisation must move with it, or face being left behind. CIOs and IT teams should not have to fight against the risks that come with employees attempting to innovate their work. Instead, they should embrace digital change and locate tools which help them to manage and regulate shadow IT.

Democratisation of IT can still be possible, but this must go hand in hand with a governance framework which is respected by teams in all departments of an organisation. With more companies adopting a digitalised business roadmap, it is crucial for them to understand that their options are not limited when it comes to controlling shadow IT and cloud costs.  By coordinating business teams effectively, with the right management tools, the CIO can have full visibility over the organisation’s SaaS portfolio and its governance – without hindering productivity.