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How Do You Quantify the ROI of Network Monitoring?

Dirk Paessler

Return on Investment is a tricky term. It is quite simple to take the total cost of software and amortize it over a period of time. But in the case of network monitoring, that analysis ignores what the software actually does. Put simply, network monitoring gives IT visibility and insight into their infrastructure, helping spot problems before they start, and ensuring uptime and availability. Calculating ROI for such software without acknowledging its impact would be akin to amortizing the cost of a sales enablement tool without considering if it increases sales. A more forward-looking approach that accounts for the software’s impact is necessary, but the analysis is not without its issues.

When used correctly, network monitoring software can prevent a number of problems – mail server crashes, website failures, and network downtime, among others. The benefit to users and IT is obvious, but the effect on the bottom line is more difficult to quantify. Losing email for a day affects productivity, but losing email at 9 a.m. on a Monday is different than 4 p.m. on a Friday. Similarly, a website crash is a disaster if it happens for a retailer on Cyber Monday, but is less of a problem for most other businesses.

There have been studies aimed at quantifying the costs of IT failures. In 2012, industry analyst Michael Krigsman published an article that put the total cost of IT failures on the world economy at $3 trillion per year. A Gartner study from 2014 put a finer point on the issue, stating that the average cost of network downtime is $5,600 per minute, or $300,000 an hour. While the effects of downtime and outages will be felt differently by individual businesses, these studies highlight both the need for network monitoring, and illustrate the financial case that can be made for it.

IT managers looking to make the case for network monitoring in their budgets do not need to use analyst figures or estimates. Instead, they can look at a number of local factors – including the costs of IT staffing, the average time it takes to restore failures, number of network failures in the previous year, and SLAs with various service providers. By arming themselves with data, IT leaders will have an easier time explaining to the business side about the need for network monitoring.

The budgeting process for IT grows more difficult every year. Nearly every part of the business now spends money on technology, and in some cases a great deal of the budget is shifted towards marketing and sales enablement. As IT managers are constantly asked to do more with less, they need monitoring more than ever – it keeps an eye on infrastructure when they can’t. It is imperative that IT departments do not lose out on a critical tool simply because it does not have the eye-catching appeal of the "Next Big Thing". But with hard numbers and a little common-sense thinking, IT can make the case for network monitoring successfully.

Dirk Paessler is CEO and Founder of Paessler AG.

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How Do You Quantify the ROI of Network Monitoring?

Dirk Paessler

Return on Investment is a tricky term. It is quite simple to take the total cost of software and amortize it over a period of time. But in the case of network monitoring, that analysis ignores what the software actually does. Put simply, network monitoring gives IT visibility and insight into their infrastructure, helping spot problems before they start, and ensuring uptime and availability. Calculating ROI for such software without acknowledging its impact would be akin to amortizing the cost of a sales enablement tool without considering if it increases sales. A more forward-looking approach that accounts for the software’s impact is necessary, but the analysis is not without its issues.

When used correctly, network monitoring software can prevent a number of problems – mail server crashes, website failures, and network downtime, among others. The benefit to users and IT is obvious, but the effect on the bottom line is more difficult to quantify. Losing email for a day affects productivity, but losing email at 9 a.m. on a Monday is different than 4 p.m. on a Friday. Similarly, a website crash is a disaster if it happens for a retailer on Cyber Monday, but is less of a problem for most other businesses.

There have been studies aimed at quantifying the costs of IT failures. In 2012, industry analyst Michael Krigsman published an article that put the total cost of IT failures on the world economy at $3 trillion per year. A Gartner study from 2014 put a finer point on the issue, stating that the average cost of network downtime is $5,600 per minute, or $300,000 an hour. While the effects of downtime and outages will be felt differently by individual businesses, these studies highlight both the need for network monitoring, and illustrate the financial case that can be made for it.

IT managers looking to make the case for network monitoring in their budgets do not need to use analyst figures or estimates. Instead, they can look at a number of local factors – including the costs of IT staffing, the average time it takes to restore failures, number of network failures in the previous year, and SLAs with various service providers. By arming themselves with data, IT leaders will have an easier time explaining to the business side about the need for network monitoring.

The budgeting process for IT grows more difficult every year. Nearly every part of the business now spends money on technology, and in some cases a great deal of the budget is shifted towards marketing and sales enablement. As IT managers are constantly asked to do more with less, they need monitoring more than ever – it keeps an eye on infrastructure when they can’t. It is imperative that IT departments do not lose out on a critical tool simply because it does not have the eye-catching appeal of the "Next Big Thing". But with hard numbers and a little common-sense thinking, IT can make the case for network monitoring successfully.

Dirk Paessler is CEO and Founder of Paessler AG.

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Kubernetes was not initially designed with AI's vast resource variability in mind, and the rapid rise of AI has exposed Kubernetes limitations, particularly when it comes to cost and resource efficiency. Indeed, AI workloads differ from traditional applications in that they require a staggering amount and variety of compute resources, and their consumption is far less consistent than traditional workloads ... Considering the speed of AI innovation, teams cannot afford to be bogged down by these constant infrastructure concerns. A solution is needed ...

AI is the catalyst for significant investment in data teams as enterprises require higher-quality data to power their AI applications, according to the State of Analytics Engineering Report from dbt Labs ...

Misaligned architecture can lead to business consequences, with 93% of respondents reporting negative outcomes such as service disruptions, high operational costs and security challenges ...

A Gartner analyst recently suggested that GenAI tools could create 25% time savings for network operational teams. Where might these time savings come from? How are GenAI tools helping NetOps teams today, and what other tasks might they take on in the future as models continue improving? In general, these savings come from automating or streamlining manual NetOps tasks ...

IT and line-of-business teams are increasingly aligned in their efforts to close the data gap and drive greater collaboration to alleviate IT bottlenecks and offload growing demands on IT teams, according to The 2025 Automation Benchmark Report: Insights from IT Leaders on Enterprise Automation & the Future of AI-Driven Businesses from Jitterbit ...

A large majority (86%) of data management and AI decision makers cite protecting data privacy as a top concern, with 76% of respondents citing ROI on data privacy and AI initiatives across their organization, according to a new Harris Poll from Collibra ...

According to Gartner, Inc. the following six trends will shape the future of cloud over the next four years, ultimately resulting in new ways of working that are digital in nature and transformative in impact ...

2020 was the equivalent of a wedding with a top-shelf open bar. As businesses scrambled to adjust to remote work, digital transformation accelerated at breakneck speed. New software categories emerged overnight. Tech stacks ballooned with all sorts of SaaS apps solving ALL the problems — often with little oversight or long-term integration planning, and yes frequently a lot of duplicated functionality ... But now the music's faded. The lights are on. Everyone from the CIO to the CFO is checking the bill. Welcome to the Great SaaS Hangover ...

Regardless of OpenShift being a scalable and flexible software, it can be a pain to monitor since complete visibility into the underlying operations is not guaranteed ... To effectively monitor an OpenShift environment, IT administrators should focus on these five key elements and their associated metrics ...