Australian IT leaders struggle with SaaS sprawl, turn to AI

New research indicates that Australian mid-market organisations are experiencing significant challenges related to the proliferation of software-as-a-service (SaaS) applications, with a majority turning to artificial intelligence (AI) to address related operational concerns.

The 2025 SaaS Sprawl Snapshot surveyed 2,000 IT decision-makers internationally, including participants from Australia, and found that nearly half of Australian mid-market businesses manage between 51 to 200 SaaS applications, with half introducing a new tool every two to four weeks. The report outlines that this trend is contributing to increased workflow complexity, higher compliance risks, and a strain on IT resources.

According to the findings, 92% of Australian IT teams are currently using AI technologies to help identify redundant software, automate application integrations, and optimise overall usage. This represents the highest rate of AI adoption among all countries surveyed, which included Australia, the United Arab Emirates, the United Kingdom, and the United States.

Keith Payne, Regional Vice President, APAC at Nintex, said, "In Australia, software sprawl is holding organisations back and taking the wind out of their sails. Budgets are overflowing, compliance risks are piling up, and scaling feels like sailing with a dropped anchor. Nearly every mid-market organisation knows it's a problem, but with IT teams stretched thin, fixing it can feel like trying to bail out a sinking ship with a teacup."

The survey revealed that while 93% of respondents believe addressing SaaS sprawl should be a top priority, 58% reported that their existing processes for managing this sprawl are not effective. This percentage was the highest among all nations included in the study. The impact of these ineffective processes is notable: 91% of organisations reported a moderate-to-major financial burden, 41% identified increased security and compliance risks, and 34% said that SaaS sprawl is directly hindering their ability to scale operations.

The report observed that the principal responsibility for dealing with SaaS sprawl is often placed on IT departments, with 77% of respondents indicating that these teams are accountable for managing the issue. However, the survey noted that these IT teams are often under-resourced, lacking the necessary time, budget, or personnel required to implement an effective strategy.

Payne commented on operational practices observed among local organisations, stating, "Many local organisations are layering new software over old processes in a race to fill capability gaps with band-aid fixes. It might solve the problem of the day, but over time it's creating deeper disconnections between systems, teams, and workflows."

The research also highlighted broader systemic issues beyond technology itself. Only 34% of organisations provide training to their staff to help them effectively use new software, a factor the report links to the rise of unused software subscriptions and unsanctioned IT initiatives. The lack of staff enablement is described as a critical gap that exacerbates problems associated with SaaS sprawl.

Payne added, "Let's be clear, no amount of software can save a broken process. If organisations keep piling on tools without fixing the foundations, they're not transforming, they're treading water with a sinking stack."

The international survey underpinning the report was conducted by Censuswide, which surveyed senior IT leaders in four countries between March 27 and April 2, 2025, and abided by ESOMAR and British Polling Council principles.