With the recent news of Hewlett-Packard’s split into two companies, and struggling vendors like TIBCO Software going private to nurse their wounds, September’s news that application performance management (APM) leader Compuware was running both the split-apart and go-private gauntlets sent shock waves through the APM marketplace. The story this time, however, was not a vendor who had lost their way. On the contrary, Compuware’s split represents a shrewd move by a player focused on growth.
Compuware’s internal transformation, furthermore, is a harbinger of a broader shift in the APM space as digital transformation initiatives take hold at organizations around the world. As the broader technology landscape undergoes its own dramatic change, forcing businesses to double down on their customer focus, managing the performance of applications has never been more critical to the bottom line. As a result, the APM market is in the eye of the digital transformation hurricane.
Dynatrace Makes a Splash
When private equity firm Thoma Bravo bought Compuware, they divided the newly private company into two parts: Compuware, focused on the traditional mainframe business, and Dynatrace, taking over the APM offerings. This dividing line neatly separates the high-margin, gradually declining value business that retains the Compuware name from Dynatrace’s position as the acquisition’s growth play.
To be sure, growth is Dynatrace’s challenge as well as its opportunity. As the market leader over established APM players IBM, Dell, CA, and HP, as well as a large crop of smaller, fast-moving competitors, Dynatrace clearly has their work cut out for them. As John Van Siclen, General Manager of Dynatrace points out, “the digital world is different from the traditional world.”
However, Dynatrace isn’t satisfied to play a slow-moving market leader. Instead, they have created their own internal “startup,” ruxit, to drive innovation for the company as a whole. ruxit leverages artificial intelligence in smartscape, an analysis tool that automatically uncovers the root cause of performance issues in real-time, replacing the need for noisy alerts or busy dashboards that operations people must watch constantly. Furthermore, as Van Siclen says, “ruxit is targeted at cloud natives.” Time will tell whether ruxit’s innovation will help Dynatrace maintain its market leadership position.
Raising the Bar on APM
The digital world is where the growth in the APM market clearly lies, and yet, digital also raises the bar on APM. Managing web performance is vastly more complex than it was in the early days of the web, because today’s web sites – as well as modern mobile apps – typically include numerous third-party services.
“Most web pages and mobile apps these days are composed of multiple services – anywhere from dozens to hundreds,” explains Jyoti Bansal, Founder and CEO of Dynatrace competitor AppDynamics. “All of the moving parts may be working all right by themselves but there may be issues with how they interact with each other.” Online advertising, web statistics, and third-party logins using your Facebook or LinkedIn password are all examples of such third-party services that complicate the application management challenge.
Furthermore, user expectations of performance have never been higher. We’re all spoiled by fast web sites, so now we expect every site, no matter how interactive or image-laden, to load in less than a second. And paradoxically, people are actually even more demanding of their mobile interfaces.
Today, slow is not simply annoying. For businesses looking to find and support customers, slow means abandoned shopping carts, angry customers, and losing business to the competition. The result: APM is now a must-have for the digital team as well as the IT organization.
Putting the User at the Center
However, managing applications has never been trickier. Perhaps the most significant change to the APM market is that the entire notion of an application has undergone a radical transformation over the last dozen years or so, an “unprecedented change” in the market, according to Steve Tack, Vice President of Product Management at Dynatrace.
The APM story used to be about traditional enterprise applications – those monolithic monstrosities that operations people had to nurse carefully since they were so convoluted and inherently fragile. Today, however, the APM story is all about the user experience.
Yet, while users interact with web and mobile interfaces, those customer-facing apps hide extraordinary complexity under the covers – and every component must perform individually and together to keep the user happy. However, “traditional APM was not designed to manage these highly distributed apps,” AppDynamics’ Bansal says. “In these modern distributed apps, the majority of issues happen because of the interplay between different services.”
To this end, Dynatrace offers a variety of different technologies and approaches for monitoring applications, regardless of whether they are traditional on-premise apps, web or mobile apps, or cloud-based SaaS apps. “Whatever an app is doing,” says Dynatrace’s CMO Nicholas Robbe, “we can instrument it.”
AppDynamics offers similar functionality. “To ensure and maximize the web/app performance and deliver the right user experience, very tight orchestration and management among all these moving parts is required,” explains Bansal. “That’s where AppDynamics comes in – to provide full visibility into how each of the moving part is doing, but also how they interact with each other for a particular user click to ensure performance. So that if anything goes wrong, it can be detected and fixed immediately.”
The full visibility that AppDynamics offers is also a feature that Dynatrace and others tout, as it’s no longer sufficient simply to sample application monitoring data. In this modern, data-driven world, customers want and need to analyze all the performance data in order to uncover problems, and ideally, to prevent problems from impacting the all-important user experience. “You need to be proactive,” according to Dynatrace’s Robbe, for events like retailers’ Black Friday. After all, the day comes but once a year, so a single site failure can be catastrophic to the business.
In fact, this ability to be proactive is a common thread across different products in the market. It’s essential to go “beyond averages” and look at all the performance data, according to Dan Kuebrich, Product Manager for AppNeta. AppNeta is one of several relatively new entrants to the APM market that focuses on optimized web applications, cloud-based software-as-a-service (SaaS) applications, and end-user monitoring.
Bringing Everyone to the Same Table
Of all the changes that the dynamic APM industry is facing in today’s increasingly digital world, perhaps the most important aspect of the industry’s rebirth is how it’s bringing digital professionals and IT personnel together – giving them real facts to discuss that are relevant and important to both groups. In fact, APM dashboards can facilitate “fact-based discussions between the business and performance guys,” according to Peter Galvin, SVP of Marketing for mobile and web performance testing vendor Soasta.
Jyoti Bansal of AppDynamics echoes Galvin’s statement. According to Bansal, AppDynamics enables customers to “know what’s happening with the business 24 x 7 in depth” – providing critical information to both business as well as technical users. For digital professionals struggling to leverage the value of their organization’s investments in IT, the impact of web and mobile performance on the user experience can be the hook that motivates a tighter relationship with the back office.
And for CIOs and other technology executives who struggle to cast off the “cost center” mentality that has dogged IT for years, a renewed focus on the user experience may very well be the ticket to sit at the boardroom table. Now that the language of APM is laser focused on supporting customers rather than managing technology, we finally have effective tools for achieving long-elusive business/IT alignment.
Intellyx advises companies on their digital transformation initiatives and helps vendors communicate their agility stories. As of the time of writing, AppDynamics and AppNeta are Intellyx customers. All other companies mentioned are not. Dynatrace covered Jason Bloomberg’s expenses to attend their recent Perform Global User Conference, a standard industry practice.