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Strategic Investor Relations for Technology Companies

A Strategic Approach to User Experience

This post is an excerpt of our new report “The PADS Framework for Application Performance and User Experience”.  You can download the free report here.

The PADS Framework helps companies take a more strategic approach to user experience.  The PADS acronym stands for performance analytics decision support.  It’s a framework that lets IT and business managements understand the link between next-generation application performance management (APM) and big data analytics to enable improved application governance and operational performance.

Across industry sectors, companies that unify APM and user experience outperform their peer group in financial results and market valuation.  These companies also use 30% few tools to achieve these results.  The majority have consolidated onto a core platform from one vendor, with tactical deployments of other vendor solutions for specific use cases, departments or technologies.  They consistently deliver stellar user experiences with greater IT productivity and lower costs than their less-performing peers.

As such, the business cases for the PADS Framework approach to unified APM and operational intelligence are enhanced customer satisfaction and loyalty and greater operational efficiency.  The twin missions of the PADS Framework are to:

  1. facilitate communication and collaboration among IT and business teams to proactively anticipate, identify and resolve application performance and user experience problems across the entire application delivery chain; and,
  2. enable IT to orchestrate and manage internally and externally sourced services efficiently to improve decision-making and business outcomes.

For companies moving business-critical applications to the cloud, continuous user monitoring is a prerequisite.  In addition, as more applications are delivered to mobile users, application owners and developers need greater visibility into the performance and availability of critical apps from the user experience perspective.

APM for the App Economy

In the application-driven economy, no technology is more strategic to generating value than APM.  Well-performing applications enable enterprises to deliver greater value to customers while deriving more value from their data assets.

The better apps perform, the more engaged employees are with customers and the more satisfied customers are with their user experience.  Companies can generate more revenue from existing customers and win new ones.  They can enhance productivity and reduce capital and operating expenses.  And they can tighten adherence with GRC (governance, regulatory, compliance) and security initiatives.  These are the levers to improving competitiveness and achieving return on investment (ROI) and risk management objectives.

But it’s no longer enough for applications to work; they must now perform to user expectations.  Users have little to no tolerance for poor application or website performance – regardless of their location or the device they are using.  Studies have shown that users consider page load times of up to two seconds acceptable. At 3-5 seconds, they lose patience and by 8-10 seconds they are gone.

And service outages can be quite costly.  Depending on the industry sector, slow responsiveness or complete outage (brownouts or downtime) of a company’s most business critical application can cost between $100,000 and $1 million per hour.  The fallout from poor transaction performance can be a loss of customers, poor operating performance, regulatory fines for non-compliance and damage to firm reputation.

Computing megatrends such as cloud, mobile and social have dramatically increased access to information.  They have also given users unprecedented choice and amplified their voice.  As a result, user experience has become a critical element of customer influence and loyalty.

However, these megatrends also raise complexity as more apps are beyond the direct control of IT.  Modern applications have far greater connections points between the end user and the data center.  Performance issues anywhere along the application delivery chain increase the risk of user frustration.  Internally, the cost is lower productivity and employee engagement.  Externally, poor application performance can result in lost business and customer loyalty.

A Unified Approach Correlates to Financial Outperformance

Yet because IT is held accountable for application performance – even across networks and systems that are beyond its purview – monitoring and managing user experience across all environments is a necessity.  Only a strategic and unified approach to APM that collects, integrates and analyzes all data across the entire application delivery chain – from behind the firewall and out to the Web, including third-party cloud providers and mobile apps – can provide the operational intelligence to ensure a consistently outstanding end user experience.

Delivering superior end-user experiences – to customers and employees – has become the differentiator between companies that win customer loyalty and market share and those that don’t.  This translates into numbers that C-level management, including CIOs, and investors appreciate.

Amid a do-more-with-less budget environment and more pressure on IT to justify resources, CIOs can strengthen their role in the strategic planning process by having intelligence about revenue-generating transactions, customer interactions and usage consumption patterns that drive improved business outcomes.  A more operationally efficient IT team enables businesses to act on intelligence gained from implementing a PADS Framework unifying APM and operational intelligence.  These improvements have a domino effect across all functional areas of the organization.

Download the free report here.

 

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