Unlocking the Potential Beyond Traditional SLAs

Unlocking the Potential Beyond Traditional SLAs

Introduction

In today’s fast-paced digital landscape, organizations rely heavily on their IT applications to drive business operations and customer experiences. To ensure seamless functioning, many businesses invest in incident SLA-led AMS (application management services) to manage and resolve incidents promptly. However, despite the undeniable benefits of these services, some organizations struggle to justify the return on investment (ROI) associated with them. In this blog, we delve into the paradox of incident SLA-led AMS services, exploring why ROI justification might be elusive. The article is aimed at addressing the challenges for the organization for applications catering to enterprise processes (ERP,SCM) like Oracle eBS,Oracle Fusion ERP, etc.

Limited Cost Reduction

For a customer with a limited enterprise application footprint, there is limited cost arbitration because of the optimized delivery model and hard-negotiated contract. While every service provider offers SLA-linked AMS services, there is hardly any attempt to measure the business benefit of improving business operations because of efficient AMS services. The direct impact on the bottom line may not be as pronounced if it goes unnoticed. As a result, organizations might find it challenging to allocate budgets to services that don’t show immediate cost-cutting benefits.

Difficulty in Measuring ROI

Quantifying the ROI for AMS services is a complex task. While some benefits, like improved system availability and enhanced user satisfaction, are invaluable, they are challenging to translate into monetary terms. The lack of clear, measurable metrics makes it challenging to calculate the exact ROI, leaving decision-makers sceptical about the value of these services, leading to a lighthearted approach to limited investment.

Invisible Prevention

Incident SLA-led AMS services are designed to prevent incidents from causing significant disruptions to business operations. However, when these services work as intended, incidents are either avoided altogether or resolved behind the scenes, leading to the perception that the investment isn’t providing visible benefits. This “invisible” prevention can make it difficult to convince stakeholders of the ROI’s true impact.

Short-term Perspective

Traditional ROI calculations often prioritize short-term gains and cost reductions. AMS services, however, focus on long-term stability and reliability, which might not be immediately apparent in the ROI calculations. Organizations seeking immediate returns might hesitate to invest in services that promise long-term benefits.

Cyclical Incidents

Some organizations experience a lower frequency of incidents or encounter cyclical patterns. In such cases, the perceived lack of frequent incidents might lead stakeholders to question the necessity of investing in incident SLA-led AMS services. The sporadic nature of incidents can hinder straightforward ROI justification.

Limited Customization

Incident SLA-led AMS services often follow a standardized approach to application management, which might not align perfectly with the unique requirements of every organization. This lack of customization can make stakeholders doubt the relevance of the services to their specific needs, impacting the perceived value and ROI.

Conclusion

Its time for customers to start asking some tough questions about ROI for their business for the traditional SLA-based AMS services. While ROI justification might seem elusive due to the complexities of measuring non-monetary benefits and long-term perspectives, the true value of AMS services lies in risk avoidance and a focus on business operations improvement, not just solving incidents in time.

As organizations adapt to evolving technological landscapes and dynamic customer demands, the importance of investing in proactive IT services cannot be understated. Instead of solely relying on traditional ROI metrics, organizations should consider the long-term impact, customer satisfaction, operations efficiency improvement, and risk reduction brought about by incident SLA-led AMS services when making investment decisions.

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