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CIO Authors: Jason Bloomberg, Adrian Bridgwater, Ed Featherston, Jackie Kahle, Srinivasan Sundara Rajan

Related Topics: CIO, IT Strategy, Enterprise 2.0

CIO: Article

Leaders vs Laggards in the Application Economy By @JackieKahle | @CloudExpo

What you need to learn from the application economy leaders, based on a new global research study

Leaders Versus Laggards in the Application Economy

Today, we’re at a crossroads. Some companies are choosing to dive into the application economy, while others stand back afraid of the change. It should come as no surprise then that companies that are embracing the application economy are emerging as victorious.

That’s because customers today are far more likely to experience brands through software than in-person interactions. Everything is connected through the application-based world, and customers are demanding superior user experiences.

What can you learn from the leaders in the application economy, and what will it take for you to join their ranks?

The study

We ask ourselves this every day, and our customers come to us for our advice as well. So we thought it would be helpful if we got some hard data.

Several months ago CA technologies commissioned the research firm Vanson Bourne to conduct a global survey with 1,425 senior business executives to find out what enterprises today were actually doing to respond to the application economy.

Leaders versus laggards

In looking at their responses to several questions, we were able to develop two segments we call the application economy “leaders” and “laggards”. We were then able to look at each segment’s self-reported revenue growth, profit growth, and percent of their revenue, which is coming from new products and services.

The differences are pretty compelling (see the chart below).  The leaders (as compared to the laggards) have:

  • More than double the revenue growth
  • 68% higher profit growth
  • 50% more business coming from new products and services

Okay, bet we have now have your attention!

What makes the leaders successful?

The survey didn’t stop there – we went on to look at what specific things the leaders were doing differently from the laggards – things our customers could also potentially replicate. And we discovered four concrete behaviors that differentiate the application economy leaders:

Leaders embrace DevOps to accelerate delivery of proven, high-quality applications.

Almost half (49%) of the leaders have adopted DevOps versus only 6% of the laggards. Moreover, they are far more likely to use external metrics (such as revenue and customer experience) to measure DevOps success – 58% of the leaders versus only 26% of the laggards.

Leaders use security as a business enabler rather than just a way to control access.

A full 47% of leaders (versus 18% of laggards) report that they have seen increased revenue from new services enabled by security, and 54% have seen an increase in the number of customers using their apps and services due to their security initiatives (versus 20% of laggards).

To enable a full application eco-system, 93% of leaders also open access to their APIs versus 49% of the laggards.

Leaders manage IT as a business and report better overall IT performance. Leaders are far more likely to frequently use software tools to manage IT as a business – 43% use them to share KPIs with the business (versus 6% of Laggards), 50% to evaluate shifts in IT investments (versus 12% of the Laggards) and 53% to evaluate whether IT is achieving their KPIs (versus 20% of Laggards).

Leaders adopt an enterprise-wide approach to mobility and report higher levels of consumer satisfaction and faster time-to-market from their mobility apps/services.

Rather than approach mobility as a set of siloed projects, 67% of leaders have adopted enterprise mobility (versus 14% of laggards). Just over half (52%) of leaders report increased customer satisfaction from their mobility initiatives (versus 21% of laggards) and 53% report faster time-to-market (versus 16% of laggards).

Survive and thrive in the application economy

If you still have doubts about how the application economy is going to affect your business, or are not convinced you need to transform your current IT practices in response, we encourage you to download the research report  How to Survive and Thrive in the Application Economy.

It will also give you much more details on how we developed the leaders and laggards segments. Then let me know what you think – via Twitter @jackiekahle or LinkedIn at www.linkedin.com/in/jrkahle

More Stories By Jackie Kahle

Jackie is a 30-year veteran of the IT industry and has held senior management positions in marketing, business development, and strategic planning for major systems, software, and services companies including Hewlett-Packard, Compaq, and Gartner. She currently manages the strategy and execution of CA Technologies thought leadership programs. Jackie has an MBA from the Whittemore School, University of New Hampshire, a BA in Mathematics from New York University and is the Vice-Chair of the N.H. State Council on the Arts.