SaaS Sprawl is Real: How MSPs Help You Regain Control Over Cloud Chaos

It starts innocently enough.

A new marketing team member signs up for a design platform. The sales team is testing a CRM with a free trial. HR signs up for a new payroll app because the old one was too clunky. Everyone’s trying to solve problems fast. But soon, your business is running on 20+ different SaaS tools—and nobody knows exactly who’s using what, where data is going, or what’s actually being paid for.

Welcome to the world of SaaS sprawl.

What Is SaaS Sprawl?

SaaS sprawl happens when multiple departments independently adopt software-as-a-service tools without central oversight. Over time, this creates a fragmented, unmonitored stack of cloud applications—many of which overlap in functionality, cost money, and pose security risks.

A 2024 study by Productiv found that an average company uses 371 SaaS apps, but only half of them are actively used each month. That’s a lot of unused subscriptions—and a lot of wasted budget.

How SaaS Sprawl Hurts Your Business

Let’s break down why this matters.

1. Wasted Spending

Duplicate tools, forgotten trials that turned into paid subscriptions, and multiple departments using different versions of the same tool—these are common causes of budget leakage. In many cases, businesses are spending thousands each year on software nobody’s using.

2. Security Blind Spots

Each SaaS platform is a potential access point for your company’s sensitive data. When there’s no centralized visibility, it becomes difficult to track who has access to what and whether any of it is secure. Tools without proper offboarding protocols are especially dangerous—former employees might still have access to tools housing sensitive data.

3. Poor Productivity

Ironically, the software meant to “streamline” work can often do the opposite. When different teams use different tools that don’t integrate, data silos form. Processes get duplicated. Time gets lost toggling between dashboards. The result? More confusion, not less.

4. Compliance Risks

For industries that have to follow strict compliance standards—healthcare, finance, legal—the risks grow significantly. Unmonitored SaaS tools can result in accidental data leaks or regulatory violations you didn’t even know were happening.

So, What Can You Do?

This is where Managed Service Providers (MSPs) come in.

MSPs are often associated with helpdesk support and IT infrastructure, but they play a powerful role in SaaS governance as well. Here’s how they can help:

SaaS Discovery and Inventory

The first step is awareness. An MSP will perform a full audit of your existing SaaS tools—what’s installed, who’s using what, and how often. You’d be surprised how many “rogue” apps show up in this step.

License Optimization

Why pay for 20 seats when only 7 people are using the app? MSPs review active usage data and help you right-size licenses, downgrade unnecessary tiers, or cancel unused subscriptions altogether.

Access Control and Security

Using centralized identity tools like Azure AD or Okta, Managed Service Providers can bring all your cloud apps under one umbrella—ensuring that only the right people have access and revoking access automatically during offboarding.

Integration and Standardization

An MSP can help your team consolidate tools across departments. Instead of five different task managers, they’ll help you pick the one that integrates best with your systems—and set up automation workflows so the tools talk to each other.

Strategy and Vendor Management

Your MSP isn’t just there to clean up. They’re there to plan for growth. They’ll help you create a centralized SaaS management policy, negotiate contracts with vendors, and implement a strategy to scale software usage without letting chaos creep back in.

It’s Not About Saying “No” to Software

One of the biggest misconceptions is that MSPs want to cut out tools or restrict innovation. That’s not the case. The goal is to empower teams to use the right tools effectively, while making sure the business stays secure, cost-efficient, and scalable.

Modern-day employees are more empowered than ever to make tech choices, and there’s a need for a balance between flexibility and control. MSPs help you strike that balance.

SaaS sprawl is happening in small and mid-sized businesses, too. If your team is drowning in a sea of dashboards, licenses, and renewals, it’s time to step back.

With the right MSP partner, you can untangle the mess, cut costs, improve security, and give your teams the tools they actually need—without the extra noise.

Get in touch with RTCS today!