Measuring ROI of digital transformation initiatives

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By David Noël, GVP, EMEAR at AppDynamics

Last year, across the region, digital transformation allowed enterprises of all industries and scales to marshal a defense against the economic backlash brought about by the pandemic. And, of course, enterprises did all this at breakneck speeds. There was no time to plan. Existing digital rollouts were accelerated, and new ones were quick-marched to production.

In AppDynamics’ Agents of Transformation 2021: The Rise of Full-Stack Observability report, IT professionals in the UAE confirmed that transformation projects had been accelerated due to the pandemic. The report also uncovered concerns that the pace of change would not abate in the coming months. Some 87% of UAE technologists see the need for speed in transformation as their biggest challenge for 2021.

Business leaders will push for new investments in technology, and IT will be called upon to deliver. But they must also be ready to show the return on investment (ROI) of their decisions ― there will soon come a time when IT budgets will once again start to be scrutinized in more detail and business leaders will want cold hard data to evaluate the impact of technology investments.

Lacking the right tools

Because of the siege mentality induced by the pandemic, businesses have largely been ignoring ROI, concentrating on the here-and-now needs of customers and employees.

While technologists are eager to deliver optimal digital experiences for customers and employees, they often lack the right tools to accurately measure the impact of digital transformation on business goals. Technologists point to a lack of visibility across what has suddenly become an expanding IT estate.

UAE technologists have cited new sets of priorities and challenges (85%); acceleration to cloud computing (86%); and technology sprawl and a patchwork of legacy and cloud technologies (84%) as reasons for IT complexity. And 85% point to multiple monitoring solutions that do not integrate as a major reason why complexity persists.

Demonstrating ROI

Without visibility, IT teams that have delivered real digital boons to their businesses will not be able to demonstrate ROI. 99% of UAE technologists recognize having the ability to monitor all technical areas across their IT stack and directly link that performance to business outcomes is important. But 67% say they lack the strategy and tools to effectively measure how technology decisions impact business outcomes. This does not bode well for sustainable ROI.

The data that comes from the new hybrid infrastructures we have created for ourselves is only useful if we can funnel it into a unified analytical framework that produces coherent insights. IT professionals can then turn those insights into quick, effective action that has a positive business impact. Without the right tools, technologists are unable to prioritize innovation, and technology silos and wasted investments loom large.

Against this backdrop, technologists are beginning to see full-stack observability as a solution to addressing these pressing challenges. Full-stack observability differs from the monitoring solutions that many organizations currently have. It allows IT teams to have a single high-level view of the entire IT environment ― from customer-facing applications down to core network and infrastructure. It allows admins to identify the source of performance issues and address them in time to prevent damage to their organization’s brand.

Many good works by technology teams will be undone if full-stack observability does not capture the imagination of boardrooms. Business leaders must equip IT with the tools it needs to make its case when the time comes for scrutiny of technology investments. At that moment, CIOs and others will be able, with the right platform, to prove their worth by linking their hard-won digital transformation to positive business outcomes.