Application Management ROI: How to Show Real Results to the Business

Delivering ROI with a fast payback is a top priority for businesses. Although the economy is beginning to stabilize, businesses continue to look to IT to drive down costs. Improved application performance is directly tied to productivity and revenue generation and remains one of the best paths to a better bottom line. Here, Knowledge Center contributor Carl Eberling explains how the right application performance management solution can provide significant, measurable value to the business.

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Application management solutions that monitor and manage the entire application infrastructure, detect performance and availability problems in real time, and enable fast root-cause diagnosis can save businesses money by reducing application downtime.

In addition, application management solutions that automate much of the application management effort can boost the efficiencies of business-critical applications and staff productivity, further reducing the costs of IT operations. In short, the right application management solution can deliver significant, positive ROI with a short payback.

To deliver ROI with a short payback period-one of the most important metrics for evaluating technology investments-application management solutions must provide significant, direct benefits (as well as harder to measure indirect benefits). Direct benefits provide savings in staffing, time and overall costs that can be realized almost immediately. These direct benefits include reduced hardware, support and consulting costs, and reduced service-level agreement (SLA) penalties.

Indirect benefits provide returns such as customer satisfaction, increased productivity, business flexibility and others that are not directly measurable but still are important to the overall ROI picture. These benefits often are recurring and likely to increase over the years as the product is deployed to additional users, so it's important to take a measured approach to calculating them.

How do you show the business that the benefits of a proposed application management solution outweigh its costs? Your ROI calculation should include the following: