NAPM Investment: Why the Value Extends Far Beyond the Network
July 23, 2020

Sergio Bea
Accedian

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Over the last decade, the public cloud has completely transformed enterprise IT, allowing for more agility, flexibility and scalability, and creating new business and technology opportunities. It has, however, also placed incremental burden on IT teams.

The role of the IT department was once manageable — straightforward tasks such as computer desktop support, installing and configuring hardware and software, and monitoring and maintaining systems and servers were commonplace. But as a result of digital transformation and the adoption of new and emerging technologies, IT teams are now responsible for driving business strategy and cost savings. With all of the new responsibilities, it's not surprising that we've seen new disciplines emerge, such as NetOps, DevOps, SecOps and DevSecOps.

At the same time, as the point-person for overseeing IT teams, the role of the CIO has expanded — now leading everything from the adoption of new technology stacks to the management of customer experience. In a world where every customer engagement point can make or break brand loyalty, it's more important than ever for CIOs to adopt a digital-first strategy. This includes implementing the right processes, procedures and technologies that ensure optimal performance of networks and applications.

Networks and applications drive the efficiency of business processes and the experience of customers, and subsequently, they drive revenue and profitability for organizations. But, according to IDG, over 75% of IT organizations still suffer from degraded business applications.

Network and Application Performance Management (NAPM) technology provides visibility into performance issues, empowering CIOs and IT teams with the ability to quickly identify and resolve problems before they impact the end user experience. According to a recent study from Accedian and the Centre for Economics and Business Research (CEBR), the technology also offers many business and economic benefits to IT teams far beyond its role in performance, with huge boosts to the overall economy, but with an immediate impact on an organization's employee productivity.

The Impacts of NAPM Investment

It's common for many IT teams to focus on a specific scope of responsibility – whether it's the network, systems, cloud, application or database. NAPM technology provides teams with end-to-end performance visibility, proactively delivering actionable insights to detect and fix issues impacting business productivity.

In fact, when NAPM technology is deployed, Accedian's research found there was an economy-wide increase in productivity among IT workers (as much as a 7.7% boost in productivity), which translates to more than $18.9 billion added to the U.S. economy by 2024. To put this into perspective, that's over 50% of the entire economy of the state of Vermont. If anything, these figures are conservative, as this study was carried out pre-COVID-19 when workers were not as reliant on the network.

When looking at industry-specific data, IT, telecoms and communications services experience the greatest benefits from NAPM technology. Across this sector, IT worker productivity contributes $13.3 billion of value to the general economy. And even beyond this increase, NAPM in the sector contributes a further $1.5 billion in reduced network downtime — meaning the financial consequences associated with network outages are significantly mitigated. But that's not to say this is the only industry where NAPM offers big benefits. A boost in IT productivity in the finance and insurance industries, for example, contributes $4.2 billion of total economic general value add. Retail comes in with a comparatively small boost of $200 million, but with high competition among retailers who are increasingly relying on online revenue, this number is still significant.

Productivity isn't the only benefit that the research found from NAPM technology adoption. The benefits cascade across entire industries, greatly affecting cybersecurity and uplifting the overall economy. The study found a massive reduction in data breach-related fines by as much as $157 million by 2024. Overall, it has the potential to add as much as $32.7 billion to the overall U.S. economy by 2024, representing a 0.13% increase in forecasted GDP.

Your Network and the New Normal

The COVID-19 pandemic has shown us how important network and application performance really is, as we are now reliant on it for everything from work to school to shopping for everyday necessities. This makes network uptime all the more necessary. CIOs and IT teams must understand the true importance of network performance and rise to the occasion, taking the network into consideration when configuring organizational technology stacks.

Sergio Bea is VP Global Enterprise and Channels at Accedian
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