By Mehdi Daoudi, CEO of Catchpoint

Mehdi Daoudi, CEO of CatchpointForrester predicts 2017 will be the year that enterprises start moving to the cloud in a big way, harnessing it to power their core business systems and customer-facing applications. Specifically, the forecast is that the global public cloud market will reach $146 billion this year, up from $87 billion in 2015.

Software as a service (SaaS), one of the earliest and most widely adopted cloud services, has now reached the mainstream and will continue to dominate the IT conversation. The combination of quick deployment, easy scalability, and economic efficiency make SaaS applications quite appealing, and we can expect a greater number of software vendors to move their offerings to the cloud. But while the rise in SaaS application usage has many positive benefits, one drawback is that SaaS application providers themselves are having a more difficult time ensuring high-performing, fast and reliable services, at the same time end-user performance expectations are increasing.

February’s Amazon S3 outage illuminated this point in a painful way, showing the ripple effect that performance issues can have across the broader SaaS ecosystem. But it also served as a teaching moment for both SaaS providers and SaaS user organizations that it’s high time to get your performance management strategies in order.

Modern-Day Performance Expectations Present Numerous Challenges

The ecommerce industry has long understood the importance of fast, reliable services with a simple formula: a slow site or a site that’s down results in lost revenue. The same now holds true for SaaS providers. Whether it’s employees using internal applications, partners and suppliers using collaboration applications, or customers accessing their accounts, the expectation is the same: SaaS providers must deliver exceedingly fast and convenient experiences for their user organizations’ end users.

Many SaaS providers are feeling the pressure. A recent survey conducted by TechTarget revealed that nearly half of providers are confronted with substantial challenges in delivering adequate performance. The majority also reported they lack sufficient insight into application performance at the end-user level.

Adding to these concerns is the increasing complexity of IT infrastructure required to support the business, such as new applications and workloads. Forty-five percent of respondents reported that their organizations have at least doubled the number of systems in their technology stacks over the last two years. In these fast-changing and increasingly geographically dispersed IT environments, delivering strong performance becomes even more challenging because the number of potential points of failure increases exponentially. Most SaaS providers report that they often discover performance issues, reactively and directly from SaaS user organizations. Plus the consequences of failing to meet SLAs can be extremely costly; the average penalty in this survey measured $359,000.

Make SaaS Investments Work with a New Approach

Despite these complexities, a scalable, peak-performing SaaS model is still a viable reality. The best way to move forward is an approach where SaaS providers and SaaS user organizations work together, supported by the right technologies that provide insights into performance and metrics that ensure end-user expectations and service level agreements are being met.

SaaS user organizations can do their part, regularly monitoring service level agreements (SLAs). This will help keep their providers accountable, laying the groundwork for regular performance reviews. With SaaS user organizations playing a bigger role in managing the performance of their own applications, they can see when performance may be dropping off, understanding when their SaaS provider may be the root cause, and alerting them proactively when appropriate. It’s important to remember that SaaS performance can vary greatly, depending on how far away end users are located from the provider’s data center. With the right tools, SaaS user organizations can gauge true end-user performance levels across all geographic locations. This helps foster productive conversations with providers, flagging when certain end-user segments may need greater infrastructure support.

Both SaaS providers and their user organizations may be struggling with growing pains due to the rapid adoption and growth of cloud-based services. Unfortunately, this is not likely to change anytime soon. The challenge is for all parties to be more vigilant in monitoring the digital experience of these necessary services. However, with new management approaches like those outlined above, the performance of SaaS can keep pace with the enormous projected growth ahead. Ultimately this will help SaaS providers expand their operations and improve their offerings, while ensuring SaaS user organizations’ investments pay off.

About the Author

Mehdi Daoudi is the co-founder and CEO of Catchpoint Systems, a premier provider of web performance testing and monitoring solutions. His team has expertise in designing, building, operating, scaling and monitoring highly transactional Internet services used by thousands of companies that impact the experience of millions of users.

Before Catchpoint Systems, Mehdi spent 10+ years at DoubleClick and Google, where he was responsible for Quality of Services, buying, building, deploying, and using monitoring solutions to keep an eye on an infrastructure that delivered billions of transactions daily.