Leaders and laggards

Based on respondents' answers to several key questions in the Vanson Bourne study*, a set of leaders and laggards has been defined in the application economy, and their self-reported business performance was examined.

Overall, leaders are outperforming laggards by a significant percentage across all business metrics examined.

Leaders are achieving more than double in revenue growth, 68% higher profit growth and have 50% more business coming from new products and services - a key indicator of innovation and future success. Clearly, the leaders must be doing something right.

Since this survey looks broadly at many of the technologies and processes needed to succeed as a software-driven business, the leaders' responses to key questions can be analysed in order to develop a set of recommendations and best practices for success in the application economy.

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 only 18% of laggards) report 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/services due to their security initiatives (versus 20% of laggards). To enable a full application ecosystem, 93% of leaders also open access to their APIs versus just 49% of the laggards. While security is often a concern in doing this, leading enterprises understand they can use modern tools to secure access to their APIs.

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 laggards) and 53% to evaluate whether IT is achieving their key performance indicators (KPIs) versus 20% of laggards. As a result, 42% of LOB executives in leader organisations report being "completely satisfied" with IT's ability to understand business needs (versus 6% of laggards).

Leaders are achieving more than double in revenue growth.

Leaders adopt an enterprise-wide approach to mobility and report higher levels of consumer satisfaction and faster time-to-market from their mobility applications and services. Rather than approach mobility as a set of siloed projects, 67% of leaders have adopted enterprise mobility (versus 14% of laggards). Fifty-two percent 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).

There are four clear lessons to be derived from this research:

Lesson 1:
DevOps needs to become a best practice in if a company is to succeed in this new application-driven economy.

Lesson 2:
Security needs to enable the business to pursue new opportunities in the application economy, not just protect it.

Lesson 3:
Enterprises must take a strategic approach to IT and manage it according to aligned business metrics to ensure success in the application economy.

Lesson 4:
To respond to the challenges of the application economy, enterprises need to approach mobility not as a series of piecemeal projects, but with an eye to a long-term enterprise-wide strategy.

Following these best practices and learning from the leaders will provide a blueprint for business strategy, as well as an action plan to ensure companies are not left behind in the application economy.

Future reports in this series of Industry Insights will explore the key areas noted above in more depth, and provide insightful guidance on how to evolve a company's business and IT strategy.

* The survey: This global study was conducted online by UK-based Vanson Bourne in July-August 2014, with 1 425 senior IT and line-of-business executives at enterprise organisations with revenue of at least $500 million. The survey was conducted across five industry verticals of financial services, healthcare, retail, telecommunications and media/entertainment in the following 13 countries: US, Canada, Brazil, UK, France, Germany, Italy, Switzerland, Spain, Australia, China, India and Japan. For further information, log on to: www.ca.com/za.