Research released by Compuware Corporation has revealed that European manufacturers lose more than 0.7M (736,387) every year due to performance-related problems with cloud-based applications, such as e-commerce sites not optimised for mobile devices and Internet-based business applications with slow response times. Furthermore, the survey of 300 European IT directors revealed that 58 percent of manufacturing businesses are slowing down or stopping adoption of further cloud applications until they can solve these application performance issues.
Richard Stone, cloud computing solutions manager at Compuware explained: "Manufacturers have already been investing in cloud applications, such online collaboration tools, but have done so without giving too much consideration to the hidden business risks that result from poor performance. Although these businesses clearly understand the flexibility and cost benefits of the cloud model, our research indicates that further adoption will be severely hampered unless cloud performance management is tackled. Customers' expectations have changed dramatically in the last few years -- today's customers are impatient, unencumbered with antiquated notions such as brand loyalty, and expect things to just work. The only way that manufacturers can successfully re-connect with their customers, increase confidence and ensure full cloud ROI is by updating their approach to application performance management to align with these new expectations."
The research also found that 69 percent of manufacturers admitted that their ability to guarantee service levels is severely restricted because cloud applications, by their very nature, are delivered over an open network - the Internet. Historically, manufacturing organisations have structured their application performance management strategies around internal infrastructures where they have complete control. However, as the nature of business applications continues to undergo extensive changes, moving from inside the borders of the manufacturing business to a "borderless" environment outside of the firewall, the approach used to manage them must also become borderless.
The research did indicate that most manufacturers understood this. 78 percent of those questioned stated that they would expect more rigorous SLAs that go beyond simple availability metrics if they increase their use of business-critical cloud applications. In fact, to increase the level of adoption, those surveyed demanded SLAs based on end-user experience. The key question is no longer "Is it available?" but rather, "Is it fast enough?". 68 percent of IT directors in manufacturing firms also stated that their IT teams had the skills needed to negotiate the more complex SLAs needed for cloud services.
"This research shows us that cloud adoption is being hampered by concerns around application performance. However, there are signs that this can be overcome," added Stone. "Firstly, the manufacturing companies surveyed know that, in order to get the most from cloud applications, an end-user view is needed. They have also indicated that their IT teams have the skills needed to negotiate these more end-user oriented SLAs. Security concerns are obviously still important but it's clear that performance is now becoming the 'day in, day out' business inhibitor in manufacturing organisations, and that has to be solved. The good thing is people are becoming aware of the issue . They understand that end-user application performance has a direct and dramatic impact on revenue, and so the end-user experience can't be compromised."
The survey consisted of 300 European IT directors from the financial services, retail, and manufacturing industries. It was commissioned by Compuware and conducted by independent research company Vanson Bourne.