Four out of five businesses (81 percent) are expected to see a negative impact on revenue in the next 12 months if they fail to complete digital transformation initiatives, according to the MuleSoft Connectivity Benchmark Report 2018.
While IT budgets have remained relatively static, IT Decision Makers (ITDMs) have seen project volumes grow, on average, by 27 percent. As a result, IT departments are being stretched even thinner. Most concerning, the research reveals an IT delivery gap, with two-thirds of ITDMs admitting they were unable to deliver all projects asked of them last year.
Integration Headaches are Creating an IT Delivery Gap and Hindering Innovation
One of the main contributors to the growing IT delivery gap is integration, which continues to be a significant drain on time, budget and resources. The survey results show the vast majority (89 percent) of ITDMs believe that integration challenges are slowing or hindering digital transformation within their organizations.
■ According to Gartner, “Worldwide IT spending is projected to total $3.7 trillion in 2018, an increase of 4.5 percent from 2017.” Based on Mulesoft's survey results, organizations are spending nearly a quarter (22 percent) of their annual IT budgets on integration and thus could equate to over $800 billion spent on integration in 2018.
■ On average, organizations are using 1,020 individual applications across their business. However, on average, a relatively small number (29 percent) of these applications are currently integrated or connected together.
■ A significant number (81 percent) of ITDMs admit that point-to-point integration has created some of the biggest headaches their organizations have ever seen. This is clearly a source of frustration for many ITDMs; in fact, at least 80 percent agree “point-to-point integration must die in the next five years if organizations are to reduce costs, deliver on business needs faster, remain competitive, deliver innovation faster, and extract more value from data.”
“When it comes to digital transformation, it is no longer a case of ‘if’ but ‘when’ for organizations. However, there is growing impatience at a business level to make the goals of digital transformation a reality right now, as those that fall behind will start to lose revenue and market share fast,” said Ross Mason, Founder and VP of Product Strategy, MuleSoft. “Today, CIOs and IT decision makers are under a huge amount of pressure to meet business expectations, but it’s clear that they are struggling to keep up. Integration challenges are creating an IT delivery gap, and organizations can no longer afford to let it drain time, resources and budget.”
Inefficient IT Operating Models are Slowing the Pace of Change
It is clear that organizations need to adopt a more efficient IT operating model. Yet, this is easier said than done as ITDMs continue to face the age-old dilemma of ‘keeping the lights on’ versus innovating. Furthermore, when it comes to building new applications and services, it is very common for development teams to work in isolation, meaning organizations are unable to discover and reuse the assets that have been created.
■ ITDMs continue to spend the majority (63 percent) of their time on “running the business” activity compared to innovation and development projects.
■ 93 percent of ITDMs admit that their application development process could be more efficient.
■ Just a third of organizations’ internal IT software assets and components are available for developers to reuse. 83 percent of ITDMs say their organization does not always reuse software assets when it comes to developing new products and services.
API Strategies are Delivering Greater Efficiency, Innovation and Revenue
For organizations to deliver digital transformation and innovate quicker, they need to enable self-serve IT, where the wider business can do more on its own without relying on central IT for each project. By making IT assets discoverable and reusable via APIs, organizations can become more agile and competitive to drive revenue.
■ 93 percent of ITDMs believe that IT self service will be critical to their digital transformation success. From those organizations that own APIs, more than half (58 percent) have been able to leverage them to increase productivity; while nearly half (48 percent) have increased innovation.
■ By leveraging APIs, organizations have been able to increase employee engagement and collaboration (43 percent), meet line-of-business demands quicker (35 percent), increase IT self service (35 percent) and decrease operational costs (34 percent).
■ On average, ITDMs reported that a quarter of their organization’s revenue is now generated from APIs and API-related implementations. More than a third (35 percent) of respondents stated over a quarter of their organization’s revenue came from APIs.
Marshall Van Alstyne, MIT digital fellow and Boston University professor, commented: “As the digital economy continues to grow, more organizations are starting to realize the benefits of an API strategy and the financial benefits it can bring. MuleSoft’s Connectivity Benchmark Report corroborates our own findings that there is a positive relationship between the intensity of API usage and financial performance.”
“Digital transformation isn’t just a matter of buying new software and hoping it solves all problems. In today’s digital economy, more data, applications and devices need to be connected than ever before – yet organizations are suffering from the chronic integration issues of the past. However, through application networks, organizations can make more of their IT assets reusable and make application development much more efficient. This will truly transform how IT functions in the modern enterprise and deliver greater value to the business,” added Mason.
Methodology: The survey was commissioned by MuleSoft and independently carried out by Vanson Bourne. The total sample size was 650 IT Decision Makers (ITDMs) working at organizations with 1,000+ employees: US (250 ITDMs), UK (100 ITDMs), Germany (75 ITDMs), Netherlands (50 ITDMs), Australia (50 ITDMs), Singapore (50 ITDMs) and China (75 ITDMs). Fieldwork was undertaken in November / December 2017. The results in the 2018 Connectivity Benchmark Report cannot be compared to previous years due to the change in research firm and methodology.
In Episode 2, Jonah Kowall, CTO of Logz.io and former Gartner Research VP, joins the AI+ITOPS Podcast to discuss some of the hottest topics in ITOps today, including AIOps, Open Telemetry, Observability, and the challenges of Big Data in AI ...
Dennis Drogseth, VP at EMA, on the AI+ITOPS Podcast: "Digital transformation ... and the need for IT to enable digital business outcomes, is greater than ever, and all the tools including AIOps and automation ... are critical in making the difference ..."
Application or network downtime is expensive, and given the growing numbers and types of high-availability and mission-critical applications, systems and networks — and our increasing reliance on them — ensuring consistent access to mission-critical applications is essential for ensuring customer loyalty and keeping employees productive. Businesses must recognize that applications availability depends on the network and implement a strategy to ensure network-aware application performance monitoring ...
Business leaders around the world are comfortable and optimistic about the broad scale shift toward remote work, according to the Riverbed Future of Work Global Survey 2020 that included 700 business decision makers, however findings also indicate the vast majority of organizations were not well prepared when the COVID-19 pandemic began ...
APMdigest and The Field CTO joined forces to launch the AI+ITOPS Podcast. The mission of the podcast is to discuss the struggles faced by ITOps — such as digital transformation and the need to keep IT services "always on" — and explore how AI/ML, AIOps, APM and other ITOps and DevOps technologies can help. Episode 1 features guest Dennis Drogseth, VP at Enterprise Management Associates (EMA) ...
One of the most frustrating experiences for website visitors is a slow, unresponsive website. Worst-case scenario, a web bounce causes prospects to permanently bounce from your company. In an effort to help companies improve web performance, Google launched the Web Vitals initiative in May and announced three new search engine ranking factors ...
Organizations have benefited from the use of modern applications to adapt and maintain agility and reliability during the COVID-19 pandemic, according to new research by VMware. The global study also reveals improved perceptions of alignment across app developers, IT and business decision makers as they collaborate to help their organizations operate amid the pandemic ...
According to The State of ITSM in the COVID-19 Pandemic, a survey by ManageEngine, 72% of IT professionals affirm ITSM's continued effectiveness even in remote work scenarios. However, only one in two organizations have a bring your own device (BYOD) policy to support continued productivity in new remote work environments ...
Many remote employees must access a corporate private network from home to continue business as usual. Organizations are turning to virtual private networks (VPN) as never before to keep remote workers connected to critical information and tools. To protect sensitive data and network bandwidth, however, companies must secure and control that network access such as by incorporating digital certificates into their cybersecurity strategy. Follow these five VPN best practices for secure remote worker access ...