That's the way things worked for years, and the way most software still works (except through app stores) and it wasn't a madhouse of anarchy and suffering, it was perfectly fine.
Installing software "manually everywhere you want to use it" implies installing it once in 99% of cases, maybe twice in most of the rest, where "install" is a trivial process. Businesses will require that everyone use the same set of installed software, so that's not even an issue to begin with. It's not unreasonable to expect people to have a PDF reader, or Adobe software if you're working in graphics, for instance, or for Windows users to be able to read Windows documents.
Plus... you do know native software can handle automatic updates and security patches as well, right? And if you don't think people can share documents or collaborate easily with native software, I mean, that's been a thing since Napster and IRC. FTP and USENET. SAAS didn't solve any of those problems, because they were never problems.