Justifying the cost of application monitoring tools

Author: Mr. Nagarajan Pichumani

Published on: June 28, 2017

One CIO flared up when we met him last week. ''I have 48 servers on which our apps are running; I spend a rental of $100 for each server box. You ask me to pay $20 per month to monitor each server!! Are you mad to ask 20% of the cost of the server itself, just for monitoring?!!!"''- he kept on going on these lines.

I was listening carefully for 10 minutes, until he lost all his energy. I politely asked him, sir, is it ok for me to ask just 4 questions? He said yes, go on (in a bad tone of course).

I:  How many applications are running on these 48 servers?

CIO:   Around 15 apps are running - such as HR, CRM, MIS reports etc.

I:  How big is the development and testing team that maintains these 15 applications?

CIO:   We have a 15 member application team that does all these work.

I:   Great. How long these app team members working on to get these apps, up and running in production?

CIO:   Oh, this team has developed these apps over the last 18 months.

I:   How many customers/employees are using these 15 applications sir?

CIO:   Around 8000 end users and 200 odd our own employees.

Then I said, sir, this is my one last question. Answering it is upto you.

A set of 15 applications used by 8000 end users and 200 employees, developed by 15 member team over 18 months, would have easily costed you more than $450,000, assuming just $10 per hour billing. That is a big chunk of software. Don't you think, it is worth to spend 48 * 20 = $960 per month to monitor the health of a $450K worth application suite?

The CIO took a minute and understood the value proposition.

People think only about the hardware cost; they simply forget the cost of the software that runs on those hardware. We must all remember that 80% of the cost goes towards software maintenance and the initial development cost is only 20%.

It is not enough just to have kids; we need to ensure that the kids are properly monitored and given resources to learn, play and grow. The same thing is applicable to software too. Ensure you monitor your apps, so that they get the required resources to run.

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