Departments of a Software-as-a-Service (SaaS) Company
Running a successful Software as a Service (SaaS) company is a team sport and requires collaboration across multiple departments. Each department has its own unique considerations for how accounting and finance support it.
This article expands upon the concepts in the article about creating a chart of accounts (CoA) for a SaaS company. As mentioned in that article, the account numbers and names are just part of tracking the company’s activities. Classifying revenue and expense by department also helps a ton with accounting and financial reporting.
Key Elements of a SaaS Company
While the size and structure of a SaaS company varies based on its stage and its market. Key elements of any SaaS company can usually be broken into four main functions:
- Building the Product
- Selling the Product to Customers
- Maintaining the Product and Customers
- Running the Company
Everything the company does falls within these main functions. These four main functions, frequently called divisions, segments, class, or category, in accounting, HRIS, payroll and other systems. For this article I’ll call them divisions. Those divisions are called:
- Research and Development (R&D) or Product
- Sales and Marketing (S&M) or Go-to-Market (GtM, GTM)
- Customer or Cost of Sales (COS)
- General and Administrative (G&A)
Within those divisions are various departments, depending on your specific company needs. Each department should be assigned a number or code to make classifying transactions better. Below is a sample breakdown of the division and department codes.
Sample Division and Department Framework
| Division | Division Code | Department | Department Code |
| R&D | 1000 | Engineering | 1010 |
| R&D | 1000 | Product Management | 1020 |
| R&D | 1000 | UX/UI | 1030 |
| R&D | 1000 | Design | 1040 |
| GtM | 2000 | Sales | 2010 |
| GtM | 2000 | Marketing | 2020 |
| GtM | 2000 | Partnerships | 2030 |
| GtM | 2000 | Customer Success | 2040 |
| Cost of Sales (CoS) | 3000 | Customer Support | 3010 |
| Cost of Sales (CoS) | 3000 | Hosting | 3020 |
| G&A | 7000 | Executive | 7010 |
| G&A | 7000 | Finance | 7020 |
| G&A | 7000 | Accounting | 7030 |
| G&A | 7000 | Legal | 7040 |
| G&A | 7000 | HR | 7050 |
| G&A | 7000 | IT | 7060 |
| Company-wide | 8000 | Revenue | 8010 |
| Company-wide | 8000 | Cost of Sales | 8020 |
| Company-wide | 8000 | Expenses | 8030 |
| Company-wide | 8000 | Other Income | 8040 |
| Company-wide | 8000 | Other Expenses | 8050 |
The Company-wide departments allow things to be classified outside of specific departments. With these accounts you’re essentially making a philosophical decision as to how to classify incomes and expenses. I’m a proponent of an “ability to control” philosophy. That means for most departments, only the things that the leader of that department can control should be assigned to their department. This drives accountability and focus on the financial performance of the department. For example, if the company uses Microsoft Office for all employees, adding to that software expense to each specific department broken out by headcount or payroll spend creates an expense on each department’s financial reporting that they can’t control. Therefore it is ignored by that leader. The more of these that sit in their financial reports, the less they care what those reports say.
Finance and Accounting Considerations for Departments
A successful SaaS (Software as a Service) company relies on a well-structured organization where each department contributes to the overall goal of delivering value to customers. While each department has specific responsibilities, they work interdependently to create, promote, sell, and support the company’s software product. This post will explore the key departments in a SaaS company, highlighting their roles, essential titles within each team, and what these roles entail on a day-to-day basis.
Engineering
Role: The engineering team builds, tests, and maintains the software. They focus on creating a reliable, high-performance product that meets user needs.
Key Titles:
Software Engineer/Developer: Writes and tests code, develops new features, and fixes bugs.
Engineering Manager: Oversees engineering projects, manages timelines, and ensures code quality.
DevOps Engineer: Manages the infrastructure, automates deployments, and monitors system performance.
Quality Assurance (QA) Engineer: Conducts testing to identify bugs and ensure a seamless user experience.
Daily Tasks: Engineers start their day with a stand-up meeting, where team members discuss progress and address any blockers. They spend most of their day writing, testing, and reviewing code. DevOps engineers work on optimizing infrastructure, while QA engineers test new features and work with developers to resolve issues.
Product Management
Role: Product management bridges the gap between business goals and technical execution. They create the product roadmap, prioritize features, and ensure the product meets market needs.
Key Titles:
Product Manager (PM): Sets the product vision, creates the roadmap, and coordinates development with engineers.
Technical Product Manager: Works closely with engineers on highly technical products to ensure specifications are met.
Product Owner: Acts as a bridge between stakeholders and developers, ensuring that the team is building the right features.
Daily Tasks: Product managers start with cross-departmental meetings, especially with engineering and design, to discuss ongoing projects. They analyze user feedback, check key performance metrics, and refine product priorities. They also conduct competitive research to ensure the product stays relevant.
UX/UI Design
Role: The UX/UI team focuses on making the product user-friendly, visually appealing, and intuitive to use.
Key Titles:
UX Designer: Conducts user research, creates user personas, and designs workflows.
UI Designer: Focuses on the visual aspects, such as layout, color schemes, and fonts.
User Researcher: Gathers insights through interviews, surveys, and usability testing.
Daily Tasks: UX/UI designers begin by reviewing design feedback or user testing results. They work on wireframes, prototypes, or conduct user research to refine the product interface. They collaborate closely with product managers and engineers to ensure their designs are feasible and align with the product vision.
Design
Role: The design team creates all visual assets for the SaaS company, supporting both product and marketing initiatives.
Key Titles:
Graphic Designer: Designs visuals for marketing campaigns, social media, and website assets.
Brand Designer: Maintains the company’s brand identity and ensures consistency across all visuals.
Illustrator: Creates illustrations for product visuals or marketing materials.
Daily Tasks: Designers work closely with the marketing and product teams to create brand assets. They start with team briefings, followed by designing and revising visuals based on feedback. They collaborate to ensure that the product’s look aligns with brand guidelines.
Sales
Role: The sales team generates revenue by acquiring and closing new customers. They work on converting leads into paying customers through various outreach and negotiation tactics.
Key Titles:
Account Executive (AE): Engages leads, performs product demos, and closes deals.
Sales Development Representative (SDR): Qualifies leads, conducts outreach, and schedules meetings.
Sales Manager: Oversees the sales team, monitors performance, and develops sales strategies.
Daily Tasks: Sales reps start by reviewing their pipeline and planning their outreach. SDRs focus on lead generation and cold outreach, while AEs conduct product demos and follow up with prospects. Sales managers review progress and conduct training or coaching as needed.
Marketing
Role: Marketing attracts and engages customers through campaigns, content, and targeted outreach.
Key Titles:
Content Marketer: Writes blog posts, creates videos, and manages social media.
SEO Specialist: Optimizes content for search engines to increase organic traffic.
Growth Marketer: Focuses on metrics-driven strategies to increase user acquisition and retention.
Daily Tasks: The marketing team starts with a team meeting to discuss ongoing campaigns. Content marketers create posts and work on content calendars, SEO specialists analyze keyword performance, and growth marketers adjust campaigns to improve key performance indicators.
Partnerships
Role: Partnerships create alliances with other companies to expand reach, add value to the product, and drive growth.
Key Titles:
Partnership Manager: Identifies, negotiates, and manages relationships with other businesses.
Affiliate Manager: Manages relationships with affiliates who promote the SaaS product.
Channel Sales Manager: Focuses on indirect sales through partner networks.
Daily Tasks: Partnership managers research potential partners, conduct outreach, and handle relationship management. They focus on co-marketing opportunities, integrations, and other collaborative ventures that benefit both companies.
Customer Success
Role: The customer success team focuses on ensuring customers get value from the product, helping to reduce churn and increase retention.
Key Titles:
Customer Success Manager (CSM): Works with customers to understand their needs and maximize product usage.
Onboarding Specialist: Helps new customers set up the software and get started.
Renewal Specialist: Manages subscription renewals and upsells.
Daily Tasks: Customer success managers engage with customers to assess their satisfaction, provide training, and suggest additional features. They monitor usage patterns and reach out to customers who might need extra support.
Customer Support
Role: The customer support team assists users with technical issues and product questions.
Key Titles:
Support Representative: Answers customer queries via chat, email, or phone.
Technical Support Specialist: Assists with more complex, technical issues.
Support Manager: Ensures quality service and tracks performance metrics.
Daily Tasks: Support reps handle incoming requests, providing guidance and resolving issues. They escalate complex issues to technical support. Support managers analyze support metrics and identify areas for improvement.
Finance
Role: Finance manages budgets, forecasts, and financial planning for the company.
Key Titles:
Financial Analyst: Tracks financial performance and creates forecasts.
Controller: Oversees accounting practices and financial reporting.
Chief Financial Officer (CFO): Leads the finance team, sets financial strategies, and ensures financial compliance.
Daily Tasks: The finance team analyzes financial data, prepares reports, and manages budgets. The CFO focuses on strategic financial planning, while analysts focus on monitoring cash flow, revenue, and costs.
Accounting
Role: Accounting ensures accurate financial reporting and compliance with tax laws and regulations.
Key Titles:
Accountant: Manages accounts payable, receivable, and payroll.
Tax Specialist: Ensures compliance with tax regulations.
Accounting Manager: Oversees the accounting team and ensures accurate reporting.
Daily Tasks: Accountants handle daily transactions, tax specialists manage tax filings, and the accounting manager ensures reports are prepared on time and in compliance.
Legal
Role: The legal department manages contracts, protects intellectual property, and ensures compliance with laws.
Key Titles:
General Counsel: Leads the legal strategy and manages legal matters.
Compliance Officer: Ensures the company adheres to regulations.
Contracts Manager: Manages all contractual agreements.
Daily Tasks: The legal team reviews contracts, manages intellectual property, and ensures regulatory compliance. They collaborate with other teams on partnership agreements and data privacy.
Human Resources (HR)
Role: HR handles recruitment, employee relations, benefits, and compliance with labor laws.
Key Titles:
HR Manager: Manages HR activities and ensures employee satisfaction.
Recruiter: Identifies and hires new talent.
Benefits Specialist: Manages employee benefits and compensation.
Daily Tasks: HR managers handle employee relations, recruit new hires, and oversee payroll and benefits. They work on employee engagement and training initiatives.
IT
Role: The IT department manages the company’s technology infrastructure and ensures data security.
Key Titles:
IT Manager: Manages IT operations and team.
System Administrator: Manages hardware, software, and networks.
Security Analyst: Ensures data protection and security.
Daily Tasks: IT teams monitor the network, troubleshoot issues, and manage security protocols. They also support onboarding by setting up new employees’ devices and managing software licenses.
