Month-end close is right around the corner, and opening your corporate credit card statements may seem like a game of trick or treat. There will likely be some surprise charges on the bill, and only time will tell how much they throw off your budget.
You can admonish employees who spent out of bounds in the hopes of preventing future transgressions, but that isn’t really an option for those individuals who have left your company - who had purchased software subscriptions and left the card running after they were long gone.
We call these zombie subscriptions, and they’re eating up your budget alive. Fortunately, a new type of weapon has emerged to help finance teams slay their zombie subscriptions once and for all. But first, let’s explore how they came about in the first place.
When SaaS Begins to Creep
Worldwide spending on business B2B on business software subscriptions doubled from approximately $60 billion in 2014 to $120 billion in 2019, and it is expected to rise 7.4% in 2021. According to Cisco’s Global Cloud Index, almost 60% of companies say their software is completely subscription-based, and that number is projected to exceed 80% by 2023.
The average company today spends $10,000 per employee per year on subscription services. And while many SaaS platforms are put to good use, other subscription products—$28 billion worth, to be exact—are downloaded by U.S. companies each year, but never actually used.
And while your first reaction upon hearing this may be to send SaaS to its grave, that wouldn’t be productive. When used intelligently, software tools can be a great benefit to your business. SaaS subscriptions offer specialized capabilities to streamline and automate otherwise manual and disparate workflows, at a lower upfront cost than enterprise software.
Engineering teams accounted for 90% of SMB SaaS product use in 2010, but only 20% in 2019. The rest is distributed across other departments, such as Sales, Marketing, and HR. In today’s End User Era, it’s employees in those departments who are purchasing their own SaaS subscriptions—not Finance or IT.
When finance teams lack visibility into this spend, they can't prevent the purchase of duplicate or out-of-bounds subscriptions, nor can they know to stop spending on subscriptions that are no longer necessary.
Enter Casper the Friendly Ghost (Cards)
Ghost cards are back from the dead. In their first iteration, these cards allowed you to assign different card numbers to different departments within your organization. Finance could track the card numbers back to individual departments and prevent fraudulent charges. Unfortunately, the process of creating these cards was quite manual, and they lacked the robust controls needed to manage spend.
But some innovation has occurred since then. Distributed spend management software can now issue ghost cards automatically within the full request-to-reconciliation workflow, instead of as a disparate, manual step. This unifies and streamlines the entire purchasing process, improving efficiency and eliminating manual work.
Furthermore, distributed spend management software can issue ghost cards more granularly than legacy systems. Instead of assigning different card numbers to each department, this technology can assign them to each employee. This eliminates the need to share card numbers and, thus, the challenges that arise from doing so.
Furthermore, because the system collects transaction data throughout the request-to-reconciliation workflow, each ghost card is enriched with much more detailed information than just the department. Because the cards are tied to each individual employee, finance teams can set spend limits and better track purchases to ensure that no one spends out-of-bounds or over budget.
Send Zombie Subscriptions to Their Grave
So, how can you get rid of zombie subscriptions for good? Just follow the steps below:
- Identify all of the software and vendors subscribed to across your organization
- Eliminate any subscriptions that are no longer in use
- Cross-check subscriptions to compare capabilities and prices—and then consolidate
- Enable proactive controls over spend, so employees don’t purchase subscriptions out-of-bounds
- Maintain real-time visibility into purchases requests for subscriptions
- Develop a plan for off-boarding employees and transferring or canceling their associated corporate cards
We know, we know: we might as well be telling you to slay an actual zombie. But before you abandon your quest, we’d like to clarify that you don’t actually have to do anything—software can do it for you.
Meet distributed spend management software, your secret weapon against zombie subscriptions. By automating the entire process—from request to ghost cards to reconciliation—distributed spend management software takes the tedious work off your plate, so you can easily identify and eliminate zombie subscriptions, and put guardrails in place to prevent them from becoming an issue again.
A treat for you...
Just because you slay your zombie subscriptions doesn't mean all the spookiness is gone! Celebrate the season and show everyone that you’re a zombie (subscription) slayer on your next video call with these spooky Zoom backgrounds.