Reshaping Business with Speed – Part I

User experience is an all-dominating factor in our digital world. Whether you sell products through web-based platforms or you, use convenient facilities for banking activities, or you get in touch with close friends through social networks, the speed of those IT services influence you massively.

A forward-thinking organization has demonstrated that 100 ms load time improvement results in 100 Mio. $ growth in sales. In this post, I will outline why and how speed can push business ahead of their competitors.

Performance at work

A 24/7 availability has become standard for many web-based services. In our good old days, 20 years back in time speed was a luxury problem. Customers were happy if they could use some basic services such as online banking and nobody claimed about slow response times. Nowadays, things changed dramatically. If load times are above 4 seconds, 50 % of the user stop using those slow websites and spend their money on a more reliable site.

Speed has an impact on sales and satisfaction rates. The former affects sales immediately while the latter is more a long-term development which leads to loss of attention, an increase of processing times and general aversion of those services. No matter how rich your application’s functionalities are if they respond slowly to users input they get branded as a failure. Imagine that you invested real money in the new product and your entire investment gets at risk due to a simple performance problem.

Some outstanding players in our retail business solve their business problems with speed. There is Amazon which massively increased its sales after a performance push or Google and Yahoo which were able to raise advertisement profits due to delivering faster search results.

Opportunities and Risks

Due to the growing service portfolio, users are more and more in the driver seat because they decide where they spend their money. Nobody enjoys a not responding web page. No matter if you are buying products or navigating through an information provider websites, slow loading pages will increase the likelihood that you will abandon to use this site. Fast loading services will pay several times back because a reduction in abandon rates will lead to happy customers, more traffic on your site and less operational efforts.

On the risk side of a performance optimization effort are high investments due to not appropriate tools and methodologies. Costs of performance engineering suites vary, and large players often charge a dramatically higher price than their mid-size competitors. Also, open source load and performance testing solutions are in some cases a good fit but don’t forget that they offer limited simulation methodologies and often require high efforts to set up and execute load tests. In recent years organizations tend to use those freeware solutions because it has become difficult for them to get the budget for tool investments approved. Apparently, this is short time thinking with high risks involved.

Operational efforts of performance engineering suites can be high. In one of my recent writings, I’ve compared a SaaS-based with an on-premise based load and performance testing solutions. The return on performance investment of the former has outperformed the latter several times. Evaluate and compare tool, maintenance, engineering and hardware costs of the solutions on your shortlist before you make your decision. Often cloud-based platforms are the cheaper opportunity.

In my next post on this topic, I will write about how companies are speeding up their services in DevOps environments, management challenges involved and the way forward.

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