What Is Tech Stack Rationalization?
Evaluating and consolidating a company's technology tools to eliminate redundancy, reduce costs, and improve data flow between systems.
Tech Stack Rationalization Explained
Tech stack rationalization is the process of auditing every software tool a company uses, identifying overlap and waste, and consolidating to a leaner, more integrated set of tools. Most growing companies accumulate 50 to 100+ software subscriptions over time, many of which overlap or go unused.
The typical findings are sobering: 30 to 40% of SaaS subscriptions are underutilized or redundant. Different departments buy different tools for the same function. Data lives in silos because tools do not integrate. Nobody owns the overall technology strategy.
The process starts with a complete inventory: every tool, its cost, who uses it, what it does, and how it integrates with other systems. Then categorize by function, identify overlaps, evaluate consolidation options, and build a migration plan.
For PE portfolio companies, tech stack rationalization is a common 100-day initiative. It typically yields $50K to $500K in annual savings while improving operational efficiency and data quality.
Why Tech Stack Rationalization Matters
The average company spends $2,600 per employee per year on SaaS tools (Zylo). 30% of that spend is wasted on redundant or unused software. Beyond cost, fragmented tech stacks prevent data from flowing between systems, which limits visibility and decision-making.
Common Mistakes
- 1
Choosing the cheapest tool instead of the one that integrates best with your core systems
- 2
Rationalizing too aggressively and removing tools that teams depend on without migration support
- 3
Not involving end users in the evaluation, leading to adoption problems with replacement tools
Related Terms
Process Optimization
Analyzing and improving business processes to increase efficiency, reduce costs, and eliminate waste, often combined with AI automation.
AI-Powered CRM
A CRM system enhanced with artificial intelligence to automate data entry, predict deal outcomes, recommend actions, and surface insights automatically.
Operational Due Diligence
The assessment of a target company's operations, technology, processes, and team before acquisition to validate assumptions and identify risks.
Private Equity (PE) Portfolio Operations
Strategic and operational support for companies within a PE firm's portfolio, focused on driving growth, improving margins, and preparing for exit.
How Attainment Helps
Frequently Asked Questions
How do you start a tech stack rationalization?
Start with a complete inventory: list every tool, its annual cost, primary users, and core function. Group tools by function. Identify overlaps (e.g., three tools that send emails). Evaluate which tools to keep based on functionality, integration, cost, and user adoption.
How much can tech stack rationalization save?
Typical savings range from 20-40% of total SaaS spend. A company spending $300K annually on software tools can often save $60K to $120K through consolidation. The bigger value is often operational: fewer tools means cleaner data and simpler workflows.
Ready to Put This into Action?
Book a Discovery Call. We will show you how Attainment can help with tech stack rationalization and more.
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