Zylo

As the saying goes, “the essence of strategy is choosing what not to do.” Yet deciding when and how to offload important tasks like SaaS renewals to a third-party can be a difficult choice to make. Learn how the team at Redis leverage Zylo’s Managed Services alongside Zylo Benchmarks to take a strategic approach to optimizing their SaaS.

Chris Asing

VP and Head of Information Technology, Redis

As the saying goes, “the essence of strategy is choosing what not to do.” Yet deciding when and how to offload important tasks like SaaS renewals to a third-party can be a difficult choice to make. Learn how the team at Redis leverage Zylo’s Managed Services alongside Zylo Benchmarks to take a strategic approach to optimizing their SaaS.



Sharpening Your SaaS Optimization Strategy with Benchmarks

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SaaS is the future of software, the foundation of the hybrid workplace and the cornerstone of employee effectiveness.If you are an IT, Software Asset Management, or Procurement professional or executive looking to harness the power of your SaaS,&nbsp;optimize your investments, save money, and grow your business, check out these sessions from SaaSMe - the Enterprise SaaS Management Event powered by Zylo.

SaaSMe - The SaaS Management Event

Connor Mullany: All right. Hey, everyone. Thank you so much for joining us today for this breakout session. My name is Connor Mullany, and I'm a senior SaaS consultant at Zylo, regularly working with Chris and the Redis team. When working on any SaaS renewal, it's important to understand not only what your organization's usage of an application is, but also to know how the price a vendor is giving you comparison to the market. An early adopter of Zylo benchmarks, the Redis team has been able to do just that, by combining the data from benchmarks with Zola's managed services, ultimately ensuring that the team takes a strategic approach to optimizing every SaaS renewal. With that, I'll pass it over to Chris.Chris Asing: Hey. Thank you, Connor, appreciate it. Well, let's jump right in. I'm Chris Asing, I lead the IT, SaaS, procurement, and the corporate real estate and facilities group at Redis. I get to talk to you about the struggle and success that we've had with this, really, an incredibly small team that kind of gets this job done. With the help of some subject matter experts in SaaS procurement, real estate facilities, finance, legal and security, along with our partners over at Zylo and the Zylo platform itself, we've been able to just manage this chaos. Let's go ahead and get started, and I'll jump right into the agenda for today. Here's a look at what we're going to be talking about today. I'll give you a little history on our SaaS journey, but also just a little bit of history about Redis. I'll talk about our approach in terms of how we got started. We'll talk about some key priorities and where the platform sits into that picture, and then we'll look at some of the business outcomes that we've realized and some of our near term focus. Then we'll close it off with maybe just reiterating, capping up with some key takeaways. We'll leave some time for Q and A as well. All right, let's get started here. Our journey. Just a quick history lesson on Redis. Redis was founded just over 10 years ago with Redis Open Source, and later introduced the enterprise product. The enterprise product serves up a number of different capabilities, features like high availability, scalability, security, and compliance features. It offers these through its core product. Interestingly enough, with the more recent vector similarity search capabilities, it positions Redis really well and nicely for market trends that have come underway with generative AI and large language models. While just a relatively small company of around 400 people back in 2020, Redis shared all those challenges that you would see in a larger scaled maturity scaled mature enterprise company. These are the kinds of things that you prototypically think of as SaaS sprawl, things like app redundancy, outdated app ownership. As people had kind of come and gone through the organization, a large proportion actually of expensed versus purchased equipment, purchased SaaS on a PO, and utilization was all across the board. That was sort of our problem. Those are the challenges that we are dealing with. With those challenges came a number of other interesting knock- on effects. This lack of visibility, and it resulted in some interesting things. It told us we didn't realize quite what we had to deal with, and without really knowing what you have, it makes renewals and the process of that entire management, a very reactive experience. All the supporting parties from those legal, security, IT, finance organizations were sort of all reacting to having to deal with renewals. This intern really kind of makes a whole process time and effort very, very inefficient. If you think about it, in 2020 to 2021, for us, this was a period of very high double- digit growth. From a macro view, the climate really put a lot of pressure on the organization. Those same organizations that were helping us were really prioritized on helping the revenue side contracts to close out the sales deals over the buy side deals. The bottom line, it was a highly inefficient and unfavorable sort of supply demand economics internally, which really compromised the quality of the output in our operations. That's the backdrop of what we were dealing with. Moving on to how we got started, then, really, we focused and we had to focus on efficiency. It was just a matter of survival. Things were coming to us faster than we could react to, and we had very little insight into being able to understand the composition and characteristics of each of those SaaS, be it a new SaaS or be it a renewal of an existing SaaS. One of the first things we had to do was we had to settle on a source of record, and instead of having to look at identity platforms and specific SaaS platforms to export and then try and figure out usage, et cetera, we settled on Zylo being the system of record. Now, it's important to call out that we inherited Zylo. When I joined the company, Zylo was already in place, but it was heavily under attended. We actually had to put some effort in some thought around it. We settled on Zylo being the system of record and we just focused on a couple of things. Number one was we really focused on basically this idea of a 95% data accuracy on some very important key attributes. I'll share some of those attributes with you. These were things like contract start and end dates, any sort of renewal clauses, or auto- renewal clauses, the annual spend figures, who the contacts were in the business, the application, and the system side. Then where we could, we really tried to drive towards leveraging IDP or SAML integrations. For many of you who are Okta customers, this is ensuring that the way that you're tying together your app is done through a SAML integration, but we couldn't really address everything, so we had to prioritize. There were more than 200 apps or SaaS apps in Zylo at the time. The question was, which do we focus on? Of course, we looked at data risk. We had to, where there was intellectual property concerns, or customer data, or even employee data, naturally, that was a concern. For us, the bigger thing was actually having to approach this more tactically. We focused on a couple of different areas. The very first area was looking at spend that was greater than$ 50,000 a year, and for those things that were near term in terms of renewals, because we had to deal with them, it was just survival. Nothing magical, nothing highly strategic, nothing really, really smart about it. It was really just operating and executing. If you fast- forward from 2020, 2021 to today, middle part of 2023, that's still somewhat true today. What's interesting is that given our economic climate, the focus has shifted. Probably like many of you, we've shifted towards a really heavy emphasis on optimization and efficiency. It was always important, it's always important to drive value out of your purchases, but now it's a probably one of the most important things beyond just pricing in terms. I'll get into that a little bit more, but we'll move on to the next piece here. The journey. We have to talk about utilization and consolidation. What is the right level of utilization? What is the right level of adoption in your organization? It really depends. It really depends where your sensitivities are. For us, I'll just sort of share with you, we started with the approach of looking at those applications that were last used in 90 days or more, meaning those things that haven't been touched within the most, the nearest 90 days. What we found is that was a really good idea. It gave us a sense for people who may have been provisioned something, but really weren't using it. We had a very different mentality at that period in time. We said, " Well, look, if you have it and you're using it, great, it's not a waste. If you have it and you aren't using it, it's a waste. Let's see what we can do about sort of reclaiming that." 90 days seemed like a really sensible approach, and we learned a lot of things, some examples where we learned about people who had premium Zoom licenses, and they really didn't need them. We started taking some approaches there to get more efficient. Then we tightened our lens a little bit deeper, and we said, " Instead of 90 days, let's look 60 days back. Those people who haven't logged in their apps or used their apps within 60 years, let's start to look at those and see what we can do about that." Then more recently, we started looking at the most recent 30 days. It really did clarify a lot of business behaviors for us, and has allowed us to do some very interesting things. That is a very aligned approach across our business. It's not really an IT driven or a solely IT driven thing. It's highly aligned with our financial executives and our financial outlook. Then it's very aligned with our internal goals and vision for being a more automated and efficient sort of a service organization. We're able to sort of capitalize on these business objectives, and then turn them into these IT or development sorts of efforts, with low or no code sorts of automations, gather those insights, and then take some action on them. That's been a really good sort of approach to that. We also sort of took a look at another dimension, which is the optimization story. When we're evaluating a new software or when we're renewing an existing software, we look at what is the right level of adoption? If we need a hundred licenses over the course of the year, but we can only see that 90 will be useful, we go with that approach of a 90% license optimization. We have a much, much shorter overhead room between what we've licensed and what we actually need. We try to build in the contract terms that allow for either the same price or lower price, should we start to breach our contracted rate within that period. The more recent trend for us has really been a shift toward shorter term versus the multi- year sort of agreements, particularly when there's some uncertainty as to the life of the process, or the reliability of the platform and tool. For your more stable types of tools, your Salesforces of the world or your Octas of the world, it's pretty hard to decouple. It makes a lot of sense to really consider the multi- year terms. It hasn't affected us in some of the larger SaaS areas. Moving on, let me see here. There we go. All right. Onto benchmarking, whether you're really talking about a renewal or a proof of concept that's going to turn into a new deal, it's pretty important for us to get a sense for the market rates. Procurement teams can sort of use that information to negotiate more favorable terms, obviously. How do we do this? Well, how we did it in the past was you call up your friends and say, " Hey, what are you paying for this? What are you paying for that? What is your term? What is your quantity?" Et cetera, et cetera. To be completely honest, that's still highly valuable, trying to get that anecdotal data and use some real data, coupling those things together make for a more rich and enlightening deal making process. Actually, I see a comment here. It's key in having the ability and flexibility to adjust the activity threshold where it makes sense based on the app. Absolutely. Johnny, thank you for that comment. Johnny's actually near and dear to our sort of process and review of our sales management, and absolutely no one particular app is used the same way, and there's no one size fits all approach for sure. Back to benchmarking, though. One of the tricky things about this is that having worked for a couple of decades now, one of the default behaviors is to just reach out and call your friends to figure out what they're paying and how much they're paying, and what are the characteristics of their deal? You try your best to compare that to what kind of deal you would like to strike in your renewal or in your new deal. Now, with benchmarks, this is obviously a tool that takes some really important data across your cohort, meaning the quantity of licenses you're purchasing, the term your license, the term that you want to sort of go into, and then use that data to make a better decision. We couple those things together. We use the qualitative data from our peer network, we use the quantitative data from maybe more statistically reliable population that Zylo's able to provide for us. Ultimately, we kind of reach our goals of trying to become faster and better and cheaper. We get better by improving the quality of that information. It's certainly faster, because sometimes our friends just are unavailable to answer our calls. Who knows what kinds of other deals that they have sort of struck, that it may be legacy or may be more alliance driven, that may influence the price of their deal. Benchmarking has been extremely powerful for us in terms of being able to calibrate that information, versus relying solely on the anecdotal data. Moving on, let me see here. I've got a little popup here that's blocking me to advance this slide. One second. Let me see. There we go. Moving on. As you're sort of getting to the tail of this year, we've been with Zylo for a couple of years now, and we've had a number of wonderful successes, either through the managed service offering, as well as through some of the tools that we were able to self- serve with. One of the great things, yeah, I'll just sort of share with you, our Salesforce renewal, this was roughly a 60K savings across a three- year period. FreshWorks, we were historically on monthly billing arrangement. We've shifted to an annual arrangement. That garnered us a good 20% savings over the period. More recently, one that's not up here is actually the deal that we just are in the final stages of renewal with Atlassian. That was a 40% cost avoidance, based on a mixture of benchmarking, annual utilization trending. Let's see, moving on here. Let me head over here and just sort of a glimpse of things, we've had some really wonderful history. A two- year look back of our savings realized through, again, a combination of the services of the SaaS negotiator and benchmarking, in FY22 for us, we realized the largest total savings, because there's just so much low hanging fruit there. There's just so much we hadn't been attending to. By the time we sort of hit FY23, that saving surge declined a little bit, but we still exceeded at 20% savings, just breaking a 200K mark. Wonderful, wonderful success here. Yeah. I see some of the comments here. We are you being overcharged by your vendors and marketplace? Absolutely. There's always something. There's always something they could squeeze, tighten, tune, so love it. With that, I think I want to just share some key takeaways here. With so many factors that go into contracts, we've sort of learned, it's really helpful to know where you stand against your cohort. This is not, again, going to replace your peer network. Your peer network is very, very powerful, and it gives you a good sense for back channeling the intel that you need. Using these two things, using the back channel and using the platform, really do enrich your frame of reference. I've made the mistake way too many times to use enterprise size, scaled pricing for the little startup that I might work for, and it's just very difficult to have a meaningful dialogue. Yeah. These are the tools to help you calibrate yourself, maybe even humble yourself. I've worked for many large organizations, and then when I moved to these little startups who have very little in terms of quantity influence when it comes to striking a deal, you do have to sort of humble yourself in terms of what you're about to pay. We looked at it as shifting the reflexive motion, and instead of going straight to our friends and our network is go straight to the platform, and then go to your friends. Then use the two, and use the data and use the anecdotal pieces together. Yeah. Yeah. It's more about knowing that you're on the same plane. Absolutely right. Peer to peer, you don't want to be the sucker paying way more than your partners are, your friends. If you're one of the few companies not focused on cost, I'll just say this, hey, good for you. Congratulations. Maybe you worked for TikTok or something, and this whole cost optimization thing doesn't even phase you. If you're like us or the rest of us, it is definitely one of our number one priorities. I think it's definitely key to look at some of these pieces and use the tools to your advantage. That's actually all I've got for today. I just wanted to thank you. I'm going to go ahead and take a look at the chat here at any Q and A that I might have missed. Nicole or Connor, please keep me honest if I might have skipped through and missed any of these. Yeah, drop the name if you aren't focused on cost, and I think everyone here is going to be looking at the careers page. Yeah. Okay, good. I don't think I missed anything here, then. Wonderful. Well, thank you very much for the time. I'm very grateful I was able to share some of this insight with you. Yeah, that's all for us. Thank you.