The Growing Challenge of App Sprawl
App sprawl isn’t a minor inconvenience—it’s a business risk that’s expanding rapidly. According to the State of SaaS 2025 report, concerns about SaaS sprawl have increased by 55% in just one year.
This proliferation happens for several reasons:
- The rise of departmental buying outside IT’s purview
- Free trials that convert to paid subscriptions without oversight
- Employee-purchased applications flying under the radar
- Mergers and acquisitions bringing duplicate tools
- Rapid AI tool adoption without proper governance
What starts as an innocent effort to improve productivity quickly becomes a management nightmare. Marketing might purchase Canva, while individual designers are subscribing to Adobe Creative Cloud. Sales uses HubSpot, but customer success independently adopts Salesforce. The finance team has its own expense tracking software, while HR is managing employee expenses through a completely different platform.
The Hidden Costs of Uncontrolled SaaS Growth
When your tech stack grows without proper oversight, the consequences extend far beyond messy spreadsheets.
Financial Waste
Without visibility into your entire application landscape, you’re likely paying for:
- Multiple tools serving the same function
- Unused or underused licenses
- Higher-tier plans than necessary
- Former employee accounts that remain active
Security and Compliance Risks
Each new application represents another potential vulnerability:
- Sensitive data scattered across dozens of platforms
- Applications without proper security reviews
- Inconsistent access controls and authentication practices
- Compliance blind spots that can trigger regulatory penalties
Integration Headaches
When applications multiply without planning:
- Data gets trapped in disconnected silos
- Teams waste time manually transferring information
- Inconsistent data creates confusion and errors
- Workflows break down at the boundaries between tools
Productivity Drains
The cognitive load of juggling too many tools takes a toll:
- Employees must remember multiple logins
- Training requirements multiply with each new tool
- Context switching between applications wastes valuable time
- Inconsistent user experiences create friction
Shadow IT: The Hidden Driver of App Sprawl
The democratization of software purchasing has created a phenomenon known as “shadow IT”—technology adopted without IT department knowledge or approval. What was once exceptional has become the norm, with some estimates suggesting that 40% of IT spending now happens outside the IT department.
The rise of AI tools has accelerated this trend. Employees eager to boost productivity are signing up for AI writing assistants, image generators, and data analysis tools, often using personal credit cards or expense accounts. This “shadow AI” represents an even greater risk than traditional shadow IT, as these tools may process sensitive company data through external systems with unclear security practices.
Building a Unified Governance Framework
Solving app sprawl requires a strategic approach that balances enterprise needs with employee flexibility.
Centralize Visibility with a SaaS Management Platform
You can’t manage what you can’t see. SaaS management platforms (SMPs) give you a complete picture of your software landscape by:
- Discovering all applications in use across the organization
- Tracking license utilization and spending
- Monitoring security configurations and compliance
- Managing renewal dates and contract terms
Top SMPs like Zluri, Zylo, and Torii offer comprehensive discovery mechanisms that can identify applications through multiple methods, including SSO integration, expense system analysis, and browser extension monitoring.
Create Clear Procurement Processes
Establish transparent processes for software acquisition:
- Develop a software request form that captures business justification
- Create a pre-approved application catalog for common needs
- Implement tiered approval workflows based on cost and data sensitivity
- Define criteria for evaluating new tools (security, data handling, integration capabilities)
Rationalize Your Existing Stack
Take a methodical approach to cleaning up your current technology portfolio:
- Categorize applications by function
- Identify redundancies and opportunities for consolidation
- Evaluate usage patterns to find underutilized subscriptions
- Create migration plans for moving away from deprecated tools
Implement Strong Integration Practices
Break down data silos with intentional integration planning:
- Build a central integration hub (like Zapier, Make, or custom middleware)
- Prioritize API capabilities when selecting new applications
- Document data flows between systems
- Create data standards to ensure consistency across platforms
Establish AI-Specific Governance
The rapid proliferation of AI tools requires targeted governance:
- Create an AI tool evaluation framework that addresses data security
- Define which types of company data can be processed by external AI
- Educate employees on the risks of sharing sensitive information with AI tools
- Conduct regular audits of AI tool usage
Change Management: The Human Side of SaaS Governance
Technology governance isn’t just about policies and platforms—it’s about people.
Foster a Collaborative Approach
Move from a restrictive “no” culture to a “yes, with guardrails” approach:
- Include departmental leaders in governance conversations
- Create a cross-functional SaaS steering committee
- Recognize and address the needs that drive shadow IT
- Promote the benefits of coordinated purchasing (better pricing, support, security)
Educate and Communicate
Help employees understand the why behind SaaS governance:
- Develop training on software procurement processes
- Share success stories of improved integration and cost savings
- Create easy-to-follow guidelines for evaluating new tools
- Regularly update teams on available approved applications
Case Study: A Phased Approach to App Sprawl
A mid-sized financial services company discovered they were using 247 different SaaS applications, with 40% unknown to the IT department. Their approach:
Phase 1: Discovery (30 days)
They implemented an SMP to create a complete inventory of applications, documenting ownership, costs, and renewal dates.
Phase 2: Rationalization (60 days)
The team identified:
- 17 different project management tools
- 4 CRM systems
- 12 different file sharing applications
They consolidated to one enterprise solution for each major function, creating migration plans and timelines.
Phase 3: Governance Implementation (90 days)
They established:
- A tiered approval process based on cost and data sensitivity
- An application review committee with cross-departmental representation
- Regular SaaS spending reviews
- Integration requirements for new applications
Results
Within six months, the company:
- Reduced their SaaS portfolio by 40%
- Cut annual software spending by $430,000
- Eliminated 60% of shadow IT
- Improved data consistency across systems
The Future of SaaS Management
As SaaS continues to dominate the software landscape, effective governance will become a competitive advantage. Companies that master this challenge will benefit from:
- Cleaner data flows and better business intelligence
- Faster employee onboarding and reduced training costs
- More strategic vendor relationships
- Better negotiating position for enterprise deals
- Reduced security vulnerabilities and compliance risks
App sprawl may be inevitable as businesses digitally transform, but its negative impacts aren’t. With the right combination of technology, processes, and people, companies can build a SaaS ecosystem that balances innovation and control.
The differentiator won’t be which companies use SaaS—it will be which ones manage it effectively.