Show Notes
Emily asks: "We're doing a quarterly audit of our subscriptions and our software bills are absurd. There are features we never use but some we do at the premium level. How do we cut our software bloat without breaking the operation?"
In this episode, Scott exposes the "software moat" (how SaaS companies trap you in premium plans), shares his access rules and 45-day login audit policy, and tells the Hertz cell phone story about finding zero-minute phones still on the bill. You'll learn the "cut, cut, cut—add back" mantra, how to handle vendor fear tactics (sunk cost fallacy), and why mapping your workflows is essential before you cut anything.
The bottom line: Cut, cut, cut—add back if needed. Audit logins. Map workflows. Don't let fear keep you paying for tools you don't use.
Got a business question? Ask Scott here: https://scotttodd.net/ask
📜 Full Transcript (Click to expand)
Scott Todd (00:00)
Welcome to Fix My Business, the show that, well, helps you to fix your business. How do we do it? Simple, we answer your questions or questions from people in the audience who have questions who are stuck. I think that's the best way to learn is to look at what other people are stuck at and figure out how you can avoid that or get yourself unstuck learning from others. I'm your host, Scott Todd, and today's question comes from Emily, and Emily writes, we are doing
a quarterly audit of our subscriptions. Yes. 100 % pat yourself on the back for that one. I'm going to continue. And our software bills are absurd. I hear you. There are so many features we never use, but some we do and are at the premium level. How do we cut our software bloat without breaking the operation? All right, look, this is
This is really the software company's game. This is what the software companies do is they've got this thing dialed in. I call it the software moat. And what I mean by that is they know what the top tier ⁓ features are. They put it in the top tier plan so that you only use, let's say, one or two of those top tier features. The rest of them you don't even care about. And then to make matters worse, they give...
they don't give you an option on how you get your employees in there. Meaning, if I have 10 employees that need access to this tool, they all have to pay the premium plan, even though none of them or one of them uses the premium tool. That is crazy to me. And I think it's one of the fundamental flaws of software pricing today. And that's probably why they're going to take a hit with the whole AI thing, but that's a different story. Here's the deal.
Here's the way you gotta think about this. My rule is this, I'm gonna give people access to the tools who need it. It's too easy to give the access tool to the tools to everybody that needs it or everybody that wants it, but that's not the way that it is. They have to justify their request of it. And then what we wanna do is we want to build tools for the people who need, or we need to build tools for the people to get into
to support their material. So let me clarify that statement that I'm just making here. If somebody needs access to a particular tool, they should get it. However, if you're just read-only, or if you're not providing to the conversation, if you're not editing, and if you're not doing the heavy lifting, well then you don't get full access. You get guest access, and if the particular tool doesn't offer a guest access, guess what we're gonna do?
we're going to create some sort of a portal or some sort of a shared user experience to get them the read-only access that they need. We are not giving access to everybody. Now, I also have some other rules. If you do have access to a system, like I have a system in my business where everybody gets it by default, because I think it's so important that they need it. They need it. But I also pay $24 per user per month.
And basically what happens is within our company, we go in every 60 days, actually every 30 days, we're going in there and we're looking. If you have not logged into that tool within the last 45 days, you're out. We're throwing you out. You're out. We cancel your subscription. It clearly is not needed. And if you do need it, you can request access. So even though I want you in there, even though I want you to use it, if you're not using it, I'm not paying for it. That's the rule.
So if you need it, 60 days from now, you can request new access and we may or may not grant it to you. But that's the thing. We're not paying just for you to have it, just as a tool that you go in there once a year and pay for it. That's a negative. Now, when I worked at Hertz, one of the things that we did on a regular basis, and you would be surprised at this, but one of the things that we did on a regular basis, and not often enough, it was probably about once a year.
is we would pull all of the cell phone records for the company. you like you would pull all the cell phone records for the part of your company that you managed. You'd pull that and you would look for cell phones with zero minutes. Think about that one for a second. Zero minutes used in the last year. That means that somebody had a cell phone, they left the company and the company never canceled the subscription. That happens all the time. And look, this isn't a big company problem.
Within my own company, that tool that I told you that we go in and review, we just found like four people who had left the company that we still were paying subscriptions on. Three, three people that had left the company, they were still in the system, we were paying subscriptions. That's like $75 a month. Now imagine that at a very large company with a cell phone bill. Man, guess what? You cut off the phone. And then somebody shows up and they're like, my phone's not working.
Well, why didn't you use it for the last year? Where has it been? So here's the rule. Here's what I want you to do. I want you to cut, cut, cut. And if you cut too far, add back. Just keep telling yourself, cut, cut, cut, and just add back. Now, here's what's gonna happen. When you go to cut, these companies are really, really good. The companies are really, really good at stopping you from cutting their services. And they're gonna use fear to stop you from doing it. They're gonna start to tell you, wait,
Wait, wait, wait, wait, wait. If you cut, you're going to lose all this data that you stored up. And they're going to give you just enough time to pause. Pause. And that's what they want you to do. They want you to pause and say, ⁓ wait a minute. Do I really want to give up that? I've been rolling over credits for months. I'm going to give up 700 credits. Cut it. Cut it. Let it go.
Let it go, because that's the sunk cost fallacy. You cannot hold onto that. Now, Emily brings up a very valid question, though. And she says, how do you cut without breaking your operation? And here's the one thing, the one caveat that I see. What I see so many times is that we know the tools that are being used within our company.
pick the tool, doesn't matter. I don't need to name them. You know what's used in your company or your industry. But what happens is we don't know how that tool is used or by whom. So we give everybody access and we assume that they're using it. We assume that they're using it the way that we want them to. But then we go and we find out that they're not logging in. So we get them out there. But one of the things that I do within my company is we do heavy mapping. We do mapping of processes.
Okay, we map out our systems and our workflows and the way that we do that or the reason that we do that is because I want to know if this tool goes down, what's lost? If this tool is removed, what's lost? If a new tool comes along, I want to see what feeds into this tool and what comes out of that tool and the only way that I can do that is mapping workflows, mapping processes. Okay, so
I want to know how people, how people, you know, what work people do. I want to know what work the tools do. And I want to see where our biggest risk is because if I do need to change something out or change a person out, I can click what they're doing. I can see what's coming in and what's going out. And when I do that, I have instant power. So that's what I'm going to recommend that you do too is yeah, cut, but then you need to undertake a constant
culture of mapping where the work is within your business. All right, appreciate the question. If you have a question, head over to scotttodd.net forward slash ask. And by the way, on Thursdays on YouTube, not every Thursday, but generally Thursdays, we are blocking off time to do live streams on YouTube, where we are talking about system design and automation. I'm showing you how we do it in my company. And if that's of interest to you, make sure you're subscribed over on YouTube.
I will see you in our next episode.
Welcome to Fix My Business, the show that, well, helps you to fix your business. How do we do it? Simple, we answer your questions or questions from people in the audience who have questions who are stuck. I think that's the best way to learn is to look at what other people are stuck at and figure out how you can avoid that or get yourself unstuck learning from others. I'm your host, Scott Todd, and today's question comes from Emily, and Emily writes, we are doing
a quarterly audit of our subscriptions. Yes. 100 % pat yourself on the back for that one. I'm going to continue. And our software bills are absurd. I hear you. There are so many features we never use, but some we do and are at the premium level. How do we cut our software bloat without breaking the operation? All right, look, this is
This is really the software company's game. This is what the software companies do is they've got this thing dialed in. I call it the software moat. And what I mean by that is they know what the top tier ⁓ features are. They put it in the top tier plan so that you only use, let's say, one or two of those top tier features. The rest of them you don't even care about. And then to make matters worse, they give...
they don't give you an option on how you get your employees in there. Meaning, if I have 10 employees that need access to this tool, they all have to pay the premium plan, even though none of them or one of them uses the premium tool. That is crazy to me. And I think it's one of the fundamental flaws of software pricing today. And that's probably why they're going to take a hit with the whole AI thing, but that's a different story. Here's the deal.
Here's the way you gotta think about this. My rule is this, I'm gonna give people access to the tools who need it. It's too easy to give the access tool to the tools to everybody that needs it or everybody that wants it, but that's not the way that it is. They have to justify their request of it. And then what we wanna do is we want to build tools for the people who need, or we need to build tools for the people to get into
to support their material. So let me clarify that statement that I'm just making here. If somebody needs access to a particular tool, they should get it. However, if you're just read-only, or if you're not providing to the conversation, if you're not editing, and if you're not doing the heavy lifting, well then you don't get full access. You get guest access, and if the particular tool doesn't offer a guest access, guess what we're gonna do?
we're going to create some sort of a portal or some sort of a shared user experience to get them the read-only access that they need. We are not giving access to everybody. Now, I also have some other rules. If you do have access to a system, like I have a system in my business where everybody gets it by default, because I think it's so important that they need it. They need it. But I also pay $24 per user per month.
And basically what happens is within our company, we go in every 60 days, actually every 30 days, we're going in there and we're looking. If you have not logged into that tool within the last 45 days, you're out. We're throwing you out. You're out. We cancel your subscription. It clearly is not needed. And if you do need it, you can request access. So even though I want you in there, even though I want you to use it, if you're not using it, I'm not paying for it. That's the rule.
So if you need it, 60 days from now, you can request new access and we may or may not grant it to you. But that's the thing. We're not paying just for you to have it, just as a tool that you go in there once a year and pay for it. That's a negative. Now, when I worked at Hertz, one of the things that we did on a regular basis, and you would be surprised at this, but one of the things that we did on a regular basis, and not often enough, it was probably about once a year.
is we would pull all of the cell phone records for the company. you like you would pull all the cell phone records for the part of your company that you managed. You'd pull that and you would look for cell phones with zero minutes. Think about that one for a second. Zero minutes used in the last year. That means that somebody had a cell phone, they left the company and the company never canceled the subscription. That happens all the time. And look, this isn't a big company problem.
Within my own company, that tool that I told you that we go in and review, we just found like four people who had left the company that we still were paying subscriptions on. Three, three people that had left the company, they were still in the system, we were paying subscriptions. That's like $75 a month. Now imagine that at a very large company with a cell phone bill. Man, guess what? You cut off the phone. And then somebody shows up and they're like, my phone's not working.
Well, why didn't you use it for the last year? Where has it been? So here's the rule. Here's what I want you to do. I want you to cut, cut, cut. And if you cut too far, add back. Just keep telling yourself, cut, cut, cut, and just add back. Now, here's what's gonna happen. When you go to cut, these companies are really, really good. The companies are really, really good at stopping you from cutting their services. And they're gonna use fear to stop you from doing it. They're gonna start to tell you, wait,
Wait, wait, wait, wait, wait. If you cut, you're going to lose all this data that you stored up. And they're going to give you just enough time to pause. Pause. And that's what they want you to do. They want you to pause and say, ⁓ wait a minute. Do I really want to give up that? I've been rolling over credits for months. I'm going to give up 700 credits. Cut it. Cut it. Let it go.
Let it go, because that's the sunk cost fallacy. You cannot hold onto that. Now, Emily brings up a very valid question, though. And she says, how do you cut without breaking your operation? And here's the one thing, the one caveat that I see. What I see so many times is that we know the tools that are being used within our company.
pick the tool, doesn't matter. I don't need to name them. You know what's used in your company or your industry. But what happens is we don't know how that tool is used or by whom. So we give everybody access and we assume that they're using it. We assume that they're using it the way that we want them to. But then we go and we find out that they're not logging in. So we get them out there. But one of the things that I do within my company is we do heavy mapping. We do mapping of processes.
Okay, we map out our systems and our workflows and the way that we do that or the reason that we do that is because I want to know if this tool goes down, what's lost? If this tool is removed, what's lost? If a new tool comes along, I want to see what feeds into this tool and what comes out of that tool and the only way that I can do that is mapping workflows, mapping processes. Okay, so
I want to know how people, how people, you know, what work people do. I want to know what work the tools do. And I want to see where our biggest risk is because if I do need to change something out or change a person out, I can click what they're doing. I can see what's coming in and what's going out. And when I do that, I have instant power. So that's what I'm going to recommend that you do too is yeah, cut, but then you need to undertake a constant
culture of mapping where the work is within your business. All right, appreciate the question. If you have a question, head over to scotttodd.net forward slash ask. And by the way, on Thursdays on YouTube, not every Thursday, but generally Thursdays, we are blocking off time to do live streams on YouTube, where we are talking about system design and automation. I'm showing you how we do it in my company. And if that's of interest to you, make sure you're subscribed over on YouTube.
I will see you in our next episode.