This is true even with fully-managed SaaS though. There are always users who don't want the new UI, the changed workflow, the moved button. But the update mechanism isn't really the problem IMO, feature flags and gradual rollouts solve this much better than version pinning

Sure. I'm just saying in the context where fully-managed SaaS was already decided not to be an option, and a customer is deploying vendor code in their environments, the update mechanism can in fact be a problem. It's not just poor CISO management.