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Application Performance Monitoring (APM) Explained: Components, Pros/Cons, and Best Practices

Ofer Dekel

Product Manager, Intel Granulate

Application performance monitoring (APM) is a process of monitoring and managing the performance and availability of software applications. APM tools are used to identify and troubleshoot issues that may be impacting the performance of an application, and to optimize the performance of an application in order to enhance user experience.

APM involves monitoring various metrics related to the application’s performance, including response time, throughput, error rate, and resource utilization. These metrics can be collected from various sources, such as the application itself, the underlying infrastructure, and external user experience monitoring tools.

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APM tools provide real-time visibility into the application’s performance and allow for proactive identification and resolution of issues. They also offer features such as alerts, dashboards, and analytics to help teams quickly diagnose and resolve problems. By monitoring and optimizing application performance, APM can help organizations improve the reliability and availability of their applications, reduce downtime, and ultimately enhance user satisfaction.

This is part of an extensive series of guides about performance testing.

In this article:

Why Is Application Performance Monitoring Important? 

Application performance monitoring is important for several reasons:

  • Enhancing user experience: APM helps to ensure that applications are performing well and meeting user expectations. Slow or poorly performing applications can lead to frustration and dissatisfaction among users, which can ultimately impact business revenue and reputation.
  • Improving application reliability: APM helps to identify and address issues that may be impacting the reliability of applications. By detecting and resolving issues proactively, APM can help to prevent downtime and ensure that applications are available when they are needed.
  • Optimizing resource utilization: APM provides insights into the resource utilization of applications, which can help organizations to optimize their infrastructure and reduce costs.
  • Supporting DevOps practices: APM can be integrated into DevOps workflows to help teams identify and resolve issues quickly. By providing visibility into the performance of applications, APM can help to ensure that changes are made with confidence and that applications are deployed successfully.
  • Meeting SLAs: APM can help organizations to meet service level agreements (SLAs) by ensuring that applications are performing well and meeting performance targets.

What Are the Components of APM?

Here are the primary components of an APM solution:

Integration with Runtime Application Architecture

Integration with runtime application architecture is essential for APM tools to monitor and analyze application performance. This real-time analysis is essential for understanding how an application performs under various conditions and for identifying issues as they occur.

Such integration enables APM tools to collect detailed data on how different parts of an application are functioning during runtime. This data can include information on memory usage, CPU utilization, and response times for various components of the application. Modern APM solutions use distributed tracing techniques to analyze application performance, and pinpoint the root cause of issues, across physically distributed components. 

Real User Monitoring

Real user monitoring (RUM) involves monitoring the behavior and experience of real users interacting with your application. This might include tracking page load times, user interactions with different elements of your application, and overall user satisfaction.

By monitoring real users, you can get insights into how your application performs in a real-world scenario. You can identify any bottlenecks or issues that might be impacting the user experience and take corrective actions accordingly. This proactive approach helps in enhancing the overall user experience, leading to increased user satisfaction and loyalty.

Business Transactions

Business transactions monitoring provides visibility over the flow of transactions through various components of your application. An example of a business transaction is a user adding an item to an eCommerce shopping cart. By keeping an eye on these transactions, you can identify any performance issues that might be affecting the smooth flow of these transactions, and by extension, business results.

For instance, if a particular transaction is taking longer than expected, it might be due to a performance issue in one of the components involved in the transaction. By identifying such issues, you can take the necessary actions to fix them, ensuring the smooth flow of transactions and thereby enhancing the user experience.

Component Monitoring

Component monitoring involves monitoring the performance of individual components of your application. This could include the database, web server, or any other component that contributes to the overall performance of your application.

Monitoring individual components allows you to pinpoint any performance issues at a granular level. For instance, if your database is taking too long to respond, it could be affecting the overall performance of your application. By identifying such issues, you can take the necessary actions to fix them, ensuring the optimal performance of your application.

Analytics and Reporting

The final component of APM is analytics and reporting. This involves collecting and analyzing data about your application’s performance and presenting it in a way that’s easy to understand. With the help of analytics and reporting, you can gain valuable insights into the performance of your application, allowing you to make informed decisions about how to improve it.

Analytics and reporting can help you identify which components of your application are performing well and which ones need improvement, and highlight trends and patterns, allowing you to predict future performance issues and take proactive measures to prevent them.

How Does APM Work? 

APM works by constantly observing the performance of applications and checking whether they are behaving as expected. If the applications are not performing as expected, data is collected to identify the source of the issue. This data is then analyzed to determine the impact on the business, and the application environment is corrected to prevent similar problems from occurring in the future.

When configuring an APM platform, it is important to consider three categories of data: Metrics, Traces, and Log Files.

  • Metrics: Quantified measures used to understand the status of a specific process. They are often compared to a defined baseline to analyze the status of the system or process. Changing metrics can indicate an underlying issue.
  • Traces: Show the complete processing of a request, illustrating the entire journey of a request as it travels through all the components and services of the network. Traces can contain hundreds of data points, which can be used to diagnose errors, detect security threats, and isolate network issues.
  • Log files: Automatically created by an application or operating system, logs contain information about user behavior and events that took place on the app. Log files can be used to perform root cause analysis, understand why a metric changed, and identify where an event began.

Although APM can provide valuable insights, monitored data and analytics may not always be sufficient to ensure adequate user experience. Performance management systems may need to combine monitoring data with automation and orchestration to bring a level of autonomy to problem remediation.

What Metrics Does Application Performance Monitoring Track? 

APM tools can track a variety of metrics to help assess the performance of an application. Here are some of the most commonly tracked metrics:

Response time 

This metric measures how long it takes for an application to respond to a user request. It can be broken down into server response time, which is the time it takes for the server to process the request, and network latency, which is the time it takes for the request to travel across the network.


This metric measures the amount of data that can be transferred between an application and its users or other systems over a period of time. It can help determine whether an application is able to handle the expected volume of traffic.

Error rate 

This metric measures the percentage of requests that result in errors, such as server errors, client errors, or timeouts. By tracking the error rate, APM tools can help identify and resolve issues that may be impacting the user experience.

CPU utilization 

This metric measures the percentage of CPU capacity being used by an application. High CPU utilization can indicate performance issues that may be affecting the application’s response time.

Memory utilization

This metric measures the amount of memory being used by an application. High memory utilization can indicate issues with memory leaks or inefficient code.

Network usage

This metric measures the amount of network bandwidth being used by an application. High network usage can indicate performance issues that may be affecting the application’s response time.

Disk usage 

This metric measures the amount of disk space being used by an application. High disk usage can indicate issues with inefficient data storage or data retention policies.

Database queries 

This metric measures the number of queries being executed against a database by an application. By tracking this metric, APM tools can help identify slow or inefficient queries that may be impacting performance.

Page load times 

This metric measures the time it takes for a web page to load in a user’s browser. By tracking page load times, APM tools can help identify issues with slow-loading pages that may be affecting the user experience.

Transaction volume 

This metric measures the number of transactions being processed by an application over a period of time. By tracking transaction volume, APM tools can help identify issues with scalability and capacity planning.


This metric measures the amount of time an application is available and accessible to users. High uptime is critical for maintaining user satisfaction and avoiding potential revenue loss. APM tools can monitor uptime and alert teams if the application goes down or experiences issues that may impact availability.

Application Performance Monitoring vs. Application Performance Management 

Application Performance Monitoring and Application Performance Management are related but distinct concepts in the field of software performance management.

Application Performance Monitoring is the process of monitoring and collecting data about the performance of an application in real-time, with the aim of identifying and diagnosing issues that may be affecting the application’s performance. These tools typically collect data on key performance metrics such as response time, latency, throughput, and error rates, and use this data to provide insights into how the application is performing. It focuses on the real-time monitoring and analysis of an application’s performance, with the aim of identifying and resolving issues before they impact end-users.

On the other hand, Application Performance Management is a broader concept that encompasses the entire process of managing an application’s performance, from development through to deployment and ongoing maintenance. It includes a range of activities such as performance testing, capacity planning, performance optimization, and continuous monitoring. It focuses on the overall management of an application’s performance throughout its lifecycle, with the aim of ensuring that it meets the required performance standards and user expectations.

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What are the Benefits of APM?

Improving Performance and Availability

APM tools provide real-time analysis of application performance data, allowing teams to identify and resolve issues before they impact end-users. This proactive approach to performance management helps to minimize downtime and improve the overall user experience.

APM tools provide visibility into the entire application stack, from the user interface to the underlying infrastructure. This comprehensive view allows teams to identify bottlenecks or performance issues at any layer of the application and take corrective action. As a result, applications run more efficiently, are more reliable, and provide a better service to end-users.

Lastly, APM helps to ensure the availability of your application. By monitoring the performance and health of applications in real-time, APM tools can alert teams to potential issues that could lead to downtime. This proactive approach helps minimize downtime and improve customer experience.

Problem Diagnosis and Resolution

APM tools provide detailed insights into application performance, making it easier for teams to identify where and why issues are occurring. This level of insight helps to speed up the troubleshooting process, reducing the time taken to resolve issues.

In addition, APM tools provide historical performance data, allowing teams to analyze trends and patterns over time. This can help to identify recurring issues or potential areas of concern, aiding in the proactive management of application performance.

Furthermore, many APM tools offer automated problem diagnosis capabilities. This can further speed up the troubleshooting process, as teams can quickly identify the root cause of an issue and take corrective action.

Resource Optimization

APM also plays a crucial role in resource optimization. By providing detailed insights into application performance, APM tools can help teams identify areas where resources are being underutilized or overutilized.

This level of insight allows teams to optimize the use of resources, ensuring applications run efficiently and cost-effectively. This can result in significant cost savings, as teams can avoid overprovisioning resources and reduce wastage. APM tools can also provide recommendations on how to optimize resource use, based on historical performance data and predictive analytics.

Proactive Problem Prevention

By continuously monitoring application performance and providing real-time alerts, APM tools can help teams identify and resolve issues before they impact end-users.

This proactive approach to problem management can help to prevent issues from escalating and causing significant disruption. It can also help to improve the overall user experience, as users are less likely to encounter issues when using the application.

Key Challenges of APM

APM solutions provide significant benefits and have become a standard part of the operations toolset. However, they also present several challenges:

Complexity of Modern Applications

One of the key challenges of APM is dealing with the complexity of modern applications. Today’s applications are often distributed across multiple platforms and technologies, making them more difficult to monitor and manage.

Furthermore, modern applications often rely on third-party services and APIs, adding another layer of complexity to the monitoring process. This can make it challenging to gain a complete and accurate picture of application performance.

Integration with Existing Systems

Another challenge of APM is integrating it with existing systems. Many organizations have a mix of old and new technologies, from traditional databases to modern microservices, and integrating APM tools with these systems can be complex and time-consuming. Some APM solutions provide connectors or plugins that can make the integration process easier.

Data Overload

Finally, data overload is a significant challenge in APM. APM tools generate a vast amount of data, and managing and making sense of this data can be challenging. Teams need to be able to quickly and easily identify important performance data and ignore the noise. Modern APM solutions provide advanced data analysis and visualization capabilities, which can make this task easier.

Types of Application Performance Monitoring Tools 

There are several types of APM tools, including:

Application Metrics-Based APM Tools

These tools collect metrics and other data directly from the application and its underlying infrastructure. This includes data such as server response time, network latency, CPU utilization, memory utilization, and disk usage. By collecting and analyzing this data, these tools can provide insights into an application’s performance and help identify issues that may be impacting its performance.

Application metrics-based APM Tools typically provide dashboards and visualizations that display performance data in real-time. They may also offer features such as alerting, which can notify teams if the application’s performance falls outside of acceptable ranges. 

Learn more in our detailed guide to application performance metrics (coming soon)

Code Profiling-Based APM Tools

These tools use code profiling to identify performance bottlenecks in an application’s code. Code profiling involves analyzing an application’s code execution to identify areas where performance improvements can be made.

Code profiling-based APM tools typically integrate with application development environments to help developers optimize an application’s performance. They may provide visualizations and recommendations that help identify the root cause of performance issues and suggest solutions to address them.

Advanced tools perform continuous profiling, meaning they automatically profile applications to identify performance issues and optimization opportunities. For example, Granulate’s Continuous Profiler can help you optimize application performance on an ongoing basis across any environment, at any scale.

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Network-Based APM Tools

These tools monitor network traffic to identify issues that may be impacting an application’s performance. It is typically performed by network performance monitoring tools that can analyze network traffic data to identify issues such as high latency, network congestion, and packet loss that may be affecting the application’s response time. (Learn more in our blog about network congestion control).

These tools may also offer features such as network mapping and visualization, which can help teams identify network topology and performance issues. 

Learn more in our detailed guide to application performance monitoring tools (coming soon)

Application Performance Monitoring Best Practices 

Set up a Dashboard with Actionable Information  

The dashboard is the window into an application’s performance, so it’s important to ensure that it displays the most relevant and useful information. A customized dashboard can display metrics such as response time, error rate, and user satisfaction. It’s important to select the metrics that are most important to your organization and configure the dashboard accordingly.

Configure Custom Alert Policies and Notifications 

Alert policies can help ensure that issues are identified and addressed quickly. It’s important to configure alert policies based on the severity of the issue and the people who need to be notified. For example, a critical issue may need to be escalated to senior management, while a less severe issue may only require notification to the development team.

Factor in the End User Experience 

The end user experience is critical to the success of an application, so it’s important to factor it into APM. This can include metrics such as page load times, response times, and user satisfaction. By monitoring these metrics, teams can identify issues that may be impacting the end user experience and take corrective action.

Train Staff on APM Tools 

APM tools can be complex, so it’s important to ensure that personnel are trained to work with them effectively. This can include providing training on how to configure alerts, interpret metrics, and troubleshoot issues. By ensuring that personnel are trained, organizations can ensure that APM tools are used effectively to optimize application performance.

See Additional Guides on Key Performance Testing Topics

Together with our content partners, we have authored in-depth guides on several other topics that can also be useful as you explore the world of performance testing.

Optimizing Python

Authored by Intel Granulate

Lambda Performance

Authored by Lumigo


Authored by EMQX

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