Application performance management (APM) refers to the practice of monitoring and managing the performance and availability of software applications. APM tools typically use monitoring, analysis, and reporting techniques to provide insights into how applications are performing and identify potential issues that could impact their performance or availability.

The primary goal of APM is to help organizations ensure that their applications are delivering the best possible user experience, while also ensuring that they are running smoothly and efficiently. By identifying and addressing performance issues early on, APM can help prevent costly downtime and other problems that can impact business operations.

This is part of a series of articles about application performance monitoring.

In this article:

• Why Is Application Performance Management Important?
• Application Performance Management Challenges
• How Does Application Performance Management Software Work?
• Choosing an Application Performance Management Solution
• Application Performance Management Best Practices

Why Is Application Performance Management Important? 

APM is important for several reasons, including:

• User experience: APM tools can help organizations ensure that their applications are delivering the best possible user experience. By monitoring key performance indicators, such as response time and availability, APM can identify issues that may be impacting the user experience and allow organizations to take corrective action.
• Business operations: Application performance issues can have a significant impact on business operations. Slow or unresponsive applications can lead to lost productivity, decreased customer satisfaction, and even lost revenue. APM can help organizations identify and resolve these issues before they impact business operations.
• Cost savings: APM can help organizations optimize their application performance and reduce unnecessary costs associated with overprovisioning resources. By identifying and addressing performance bottlenecks, APM can help organizations achieve better utilization of their resources and reduce costs.
• Proactive issue resolution: APM can help organizations identify performance issues before they become critical problems. By monitoring key performance indicators, APM can detect issues early on and allow organizations to take proactive measures to resolve them before they impact users or business operations.

Application Performance Management Challenges 

As modern applications and IT infrastructures continue to grow in complexity, application performance management strategies face an increasing amount of challenges, including:

• Dynamic and distributed environments: With the adoption of cloud computing, microservices, and containerization, application environments have become more dynamic and distributed, making it harder to monitor and manage performance across all components.
• Scalability: As applications grow in terms of users, data, and functionality, APM solutions must be able to scale accordingly, efficiently collecting and processing large volumes of performance data without impacting application performance.
• Integration: APM tools need to integrate with various application components, infrastructure elements, and other monitoring and management tools to collect performance data. This requires support for a wide range of technologies and platforms, as well as the ability to adapt to new and evolving technologies.
• Real-time monitoring and analysis: To be effective, APM solutions must provide real-time monitoring and analysis capabilities, enabling organizations to quickly identify and resolve performance issues as they arise.
• Multi-dimensional analysis: Applications can be affected by multiple factors, such as code, database, network, and infrastructure. APM solutions must be capable of analyzing performance from different angles, correlating data from various sources to identify the root causes of issues.
• Customization: Every application is unique, and APM tools should be flexible enough to accommodate the specific needs and requirements of each application, allowing organizations to customize performance monitoring and analysis according to their specific goals and KPIs.

How Does Application Performance Management Software Work? 

Here are the key elements of APM software and how they help monitor applications.

End-User Experience Monitoring

End-user experience monitoring is used to measure how users are experiencing the application. There are two types of end-user experience monitoring:

• Passive monitoring: Involves collecting data from end-users without actively involving them, such as collecting data on network traffic, application performance, and errors. 
• Active monitoring: Involves simulating end-user activity, such as performing transactions, and measuring how long they take to complete.

Runtime Application Architecture Monitoring

Runtime application architecture involves monitoring the underlying infrastructure and application components that support the application. It provides visibility into the application’s infrastructure, including servers, databases, network devices, and virtual machines. This data can be used to identify bottlenecks and areas for optimization.

Business Transaction Management

Business transaction management tracks the flow of transactions through the application. This feature monitors how transactions are processed and identifies issues that could impact the user experience, such as slow response times or errors. This data can be used to troubleshoot and optimize transaction processing.

Deep-Dive Component Monitoring (DDCM)

Deep-dive component monitoring provides detailed insights into the performance of individual application components, such as web servers, application servers, and databases. It can identify performance bottlenecks and issues at the component level, enabling organizations to optimize the performance of their applications.

Analytics and Reporting

APM software typically includes analytics and reporting capabilities that allow organizations to view performance metrics and identify trends over time. This data can be used to make informed decisions about how to optimize application performance and improve the user experience.

Learn more in our detailed guide to application performance

Choosing an Application Performance Management Solution 

When choosing an application performance management solution, consider the following factors to help you select the right tool for your organization’s needs:

• Compatibility: Ensure that the APM solution supports the technologies, platforms, and languages used by your applications, including cloud services, container orchestration platforms, and programming languages.
• Deployment model: Evaluate whether the APM solution offers a deployment model that suits your organization’s infrastructure, such as on-premises, cloud-based, or hybrid.
• Extensibility: Look for an APM solution that offers APIs, plug-ins, or integrations with other monitoring and management tools, enabling you to extend its capabilities and create a unified monitoring ecosystem.
• Customizable dashboards and reports: Choose an APM tool that allows you to create custom dashboards and reports, enabling you to focus on the metrics that matter most to your organization and stakeholders.
• Machine learning and AI capabilities: Advanced APM solutions may leverage machine learning and artificial intelligence to automate anomaly detection, root cause analysis, and other performance management tasks. Consider whether these capabilities are important for your organization.
• Security and compliance: Verify that the APM solution meets your organization’s security and compliance requirements, including data privacy, encryption, and regulatory compliance standards.
• Vendor support and reputation: Evaluate the APM vendor’s reputation, track record, and customer support offerings, ensuring that you will receive timely assistance and product updates.

Related content: Read our guide to application performance management tools (coming soon)

Application Performance Management Best Practices

Here are best practices that can help ensure that your APM solution delivers the desired results:

• Define clear objectives: Establish clear goals for your APM initiative, such as improving end-user experience, reducing downtime, or optimizing resource utilization. These objectives will guide your APM strategy and help you measure the success of your efforts.
• Baseline and benchmark performance: Establish baseline performance metrics for your applications to track improvements and detect anomalies. Benchmark your performance against industry standards or similar applications to identify areas for optimization.
• Foster collaboration: Encourage collaboration between development, operations, and other teams involved in application performance management. A cross-functional approach promotes shared ownership of performance goals and streamlines communication and problem-solving.
• Continuous improvement: Regularly review and update your APM strategy, incorporating lessons learned and adapting to changes in your applications and infrastructure. Continuously optimize your applications based on performance data and user feedback.
• Invest in training and skill development: Ensure that your team has the necessary skills and expertise to manage and optimize application performance. Invest in training and professional development to keep your staff up to date on the latest APM tools, techniques, and best practices.
• Document and share knowledge: Maintain clear documentation of your APM processes, tools, and configurations. Share knowledge and best practices among team members to promote consistency, efficiency, and continuous learning.