Vendor Selection Matrix Next Generation Application Performance Management

Vendor Selection Matrix – Next Generation Application Performance Management: Key Highlights Scope: Global 2015 Dr. Thomas Mendel Ph. D. Managing Director September 2015 © 2015, Research In Action Gmb. H Reproduction Prohibited 1

The Research In Action Gmb. H Vendor Selection Matrix Methodology Data Summary: Ø Unique, primarily survey-based methodology for comparative vendor evaluation. Ø Roughly 60% of evaluation results are based on enterprise buyers’ survey results. Ø Analyst’s opinion accounts for roughly 40% of evaluation results (not 100% as in most other vendor evaluations). Ø More than 40000 data points were collected. Ø Data was collected in Q 1 of 2015, covering 900 IT buyers in a telephone survey, and in Q 2 of 2015, covering 700 IT buyers in an online survey of Next Generation Application Performance Management solutions. Ø 20 vendors of Next Generation Application Performance Management solutions (selected by the buyers in the survey) were evaluated. This document provide the highlights of the complete report. Ø The evaluations results and forecasts are based on customer and vendor feedback, publicly available information, triangulation, as well as the analyst’s opinion. © 2015, Research In Action Gmb. H Reproduction Prohibited 2

What Tools Do You Use To Create The Vendor Longlist? MQ/VSM Google Peers Social Media Press Decision Makers use a mix of traditional and online tools N=931 IT and Business Managers in Enterprises (Companies with more than 10, 000 employees only) © 2015, Research In Action Gmb. H Reproduction Prohibited 3

Market Overview: Requirements For Next Generation Application Performance Management What are the key requirements for a Next Generation Application Performance Management solution? N=1600 IT Managers in Enterprises © 2015, Research In Action Gmb. H Reproduction Prohibited 4

Market Overview: A Market In Transition Ø The importance of Application Performance Management is at an all time high. This is a very dynamic market, highly complex and with many different facets. Application Performance Management solutions today have many faces and definitions, few vendors can be compared on an apples to apples basis. There are more than 400 active software and Saa. S vendors generating around $ 4, 6 B in annual revenue. However, the overall importance of Application Performance Management for the IT Service, Application and Operation Management space as a whole, is still growing every year. This makes it worthwhile to look ahead to see what the future will look like for the Next Generation of Application Management solutions. Ø Saa. S will be the platform of choice for Ro. I conscious buyers. Next Generation Application Performance Management will be predominantly a Saa. S play. The vast majority of new vendors are already Saa. S-only. A much better Ro. I as well as ease of deploy and upgrade are the major drivers for this. Ø Next Generation Application Performance Management will be more streamlined. The technical requirements for Next Generation Application Performance Management will ultimately lead to a vendor landscape that is much more comparable than the one in today’s highly fragmented market. For the IT decision makers in our survey, the key requirements for the future are: (1) Hybrid Cloud management, (2) Analytics and Big Data, (3) End-to-end and real-time SLAs, (4) Application Quality Life Cycle and Dev. Ops integration, (5) Virtual CMDB integration and (6) Application discovery and application component deep-dive capabilities. © 2015, Research In Action Gmb. H Reproduction Prohibited 5

Market Overview: Market Trends 2015 What is your number one investment area in the Application Performance Management space for 2015? N=900 IT Managers in Enterprises © 2015, Research In Action Gmb. H Reproduction Prohibited 6

Market Overview: The End-User Pain Points Today Ø The Cloud challenge in the extended enterprise. The Cloud phenomenon is driving investment from IT buyers to address issues in Application Performance Management around new applications in the Cloud, as well as extended real-time and Big Data requirements. More traditional challenges around N-tier Applications and instrumentation, are further exemplified by the Cloud. Ø More business orientation. Dev. Ops is only the beginning, but already high on the agenda for 2015. As the business becomes more entrenched in Application Management as a whole, business SLAs are a key focal point for 2015 as well. Ø More integration issues than one can handle. IT decision makers are still struggling with the many areas of integration in today’s Application Performance Management implementations. Very few companies have worked this out completely. The most important integration challenges come from the areas of: (1) Cost, (2) Capacity, (3) BPM/BTM, (4) Business process and (5) The CMDB. © 2015, Research In Action Gmb. H Reproduction Prohibited 7

Market Overview: Key Points To Remember Ø A changing market with new and clearer requirements. Application Performance Management has a long history in many enterprises. Many implementations are already more than 25 years old. Vendors and IT buyers alike a struggling with updating their solution sets to accommodate the quickly changing requirements. The Next Generation Application Performance Management solutions, however, will be based a clearer set of requirements, making it easier to implement and maintain, as well as to compare vendors. Ø Saa. S will be the future delivery platform. Saa. S is now widely accepted. While new players are already predominantly Saa. S-only, established players are either revamping their solutions, or are at least offering Saa. S options. Ø One clear market leader and the comeback of an established player. Dynatrace, the rebranded former Compuware solution set is the clear winner in our evaluation and well positioned for future market dominance. BMC Software, with a new strategic direction for its Application Performance Management solution, is making serious headway in the market and will be very likely the long-term number two. © 2015, Research In Action Gmb. H Reproduction Prohibited 8

Vendor Selection Matrix – Next Generation Application Performance Management: Evaluation Criteria © 2015, Research In Action Gmb. H Reproduction Prohibited 9

Vendor Selection Matrix – Next Generation Application Performance Management: Ranking Of Selected Vendors © 2015, Research In Action Gmb. H Reproduction Prohibited 10

Vendor Selection Matrix – Next Generation Application Performance Management: Ranking Of Selected Vendors © 2015, Research In Action Gmb. H Reproduction Prohibited 11

Vendor Selection Matrix – Next Generation Application Performance Management: The Number One Dynatrace: The champion of Application Performance Management Ø General: The re-branding from Compuware to Dynatrace, was a risky endeavor indeed, but it is paying off. Clients value he renewed focus of the company, in particular with the Keynote integration which completes this impressive portfolio. Ø Strategy: Dynatrace is highly differentiated, clients give Dynatrace the highest scores when it comes to innovation. Strategically, Dynatrace is second to none. Ø Execution: Dynatrace is the current market share leader by a wide margin and will continue to be so. The company already covers all major growth areas for the future. Clients are highly satisfied and see the value in Dynatrace’s solutions. Ø Customer Quote: ”Dynatrace continues to impress us. This going private thing was a concern for sure, but now I cannot even imagine going with another vendor. ” CIO North-American retail company. Ø Bottom Line: Being focused is paying off. Dynatrace will be the reference company in Next Generation Application Performance Management for the foreseeable future. © 2015, Research In Action Gmb. H Reproduction Prohibited 12

Vendor Selection Matrix – Next Generation Application Performance Management CA Technologies: Integration will be a key competitive advantage for future growth Ø General: CA’s mission is to cover all aspects of the IT Service, Application and Operation Management space and the company does this well. CA is addressing all key client requirements of Next Generation Application Performance Management. Ø Strategy: CA is highly differentiated, the vision remains strong. However, Clients would like to see a clearer articulated strategy for Next Generation Application Performance Management. Ø Execution: CA is one of the market share leaders in Application Performance Management, still capitalizing on the Wily acquisition. Clients are very satisfied with CA today, but there were of course some complaints regarding CA’s overall pricing. Ø Customer Quote: ”When it comes to platform integration, CA is second to none. This works well for us and we will continue to work with CA in the future. ” CIO North-American financial services company. Ø Bottom Line: The overall IT Service, Application and Operation Management champion is back on track in Application Performance Management. © 2015, Research In Action Gmb. H Reproduction Prohibited 13

Vendor Selection Matrix – Next Generation Application Performance Management App. Dynamics: The fall of a rising star Ø General: Founded in 2008 by former Wily leaders, and well-funded indeed, the rise of App. Dynamics has recently come to a more or less abrupt halt. Ø Strategy: App. Dynamics is highly differentiated, clients still like the strategic approach which is very much in-line with where the market is going, but would like to see a more mature approach to company growth and profitability forecasts. Ø Execution: App. Dynamics is liked by their customers for their capability of delivering value for money. Clients also like the Saa. S and non-Saa. S options, as the all Saa. S approach is still questioned by many IT decision makers today, despite the fact that almost everyone agrees that this is the strategic future direction. Ø Customer Quote: ”We are happy with the App. Dynamics solution. However, we are concerned about the accounting and reporting principles of the company. ” CIO North-American financial services company. Ø Bottom Line: App. Dynamics needs to grow-up to become a long-term competitor in the Next Generation Application Performance Management space. © 2015, Research In Action Gmb. H Reproduction Prohibited 14

Vendor Selection Matrix – Next Generation Application Performance Management New Relic: A top Application Performance Management player in-themaking Ø General: New Relic, founded in 2008, also from former Wily Technology leaders, and like App. Dynamics well-funded, is a pure-play Saa. S Application Performance Management vendor. Ø Strategy: Clients see New Relic as highly differentiated, they value the company’s innovation capabilities and future-proof architecture, in particular as it comes to Big Data integration. Ø Execution: New Relic today has above average top 20 scores for client satisfaction as well as on a price versus value level. However, as clients become more familiar with the Saa. S-only approach of the company, Research In Action believes that the scores will improve even more. Ø Customer Quote: ”We decided to buy-into Saa. S wholeheartedly. New Relic is therefore the number one choice for us. ” CIO North-American services company. Ø Bottom Line: New Relic is moving up the ranks quickly. Though still a larger niche player, the future looks bright for New Relic. © 2015, Research In Action Gmb. H Reproduction Prohibited 15

Vendor Selection Matrix – Next Generation Application Performance Management HP: The ITIL champion is becoming more important in Application Performance Management Ø General: HP has been a key player in the IT Service Management market almost from its inception. HP’s legacy in Network Performance Management is helping the company to expand its reach into Application Performance Management. Ø Strategy: HP’s differentiation is only at a medium level. However, clients like the partnership approach and the strategic direction. Clients see also huge value in HP’s Big Data and Analytics’ solutions. Ø Execution: HP is still extremely strong in Infrastructure Performance management, Network Node Manager still being the market reference. Clients are therefore excited about the future prospects in the Application Performance Management market. Ø Customer Quote: ”We like HP’s flexibility and customer orientation. This helps us a lot when talking to our business leaders. ” CIO European manufacturing company. Ø Bottom Line: HP is now focusing more on this growth market. The future looks bright. © 2015, Research In Action Gmb. H Reproduction Prohibited 16

Vendor Selection Matrix – Next Generation Application Performance Management: Detailed Results © 2015, Research In Action Gmb. H Reproduction Prohibited 17

The Research In Action Gmb. H Vendor Selection Matrix Methodology Vendor Selection Matrix Disclaimer: Research In Action Gmb. H does not endorse any vendor, product or service depicted in our research publications, and does not advise technology users to select only those vendors with the highest ratings. The information contained in this research has been obtained from both enterprise as well as vendor sources believed to be reliable. Research In Action Gmb. H’s research publications consist of the analysts’ opinions and should not be considered as statements of fact. The opinions expressed are subject to change without further notice. Research In Action Gmb. H disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose. © 2015, Research In Action Gmb. H Reproduction Prohibited 18

Contact Dr. Thomas Mendel Ph. D. tmendel@researchinaction. de +49 160 99492223 RESEARCH IN ACTION Research In Action Gmb. H Hauptstraße 9 56244 Hartenfels Germany Office: +49 2626 9249845 Fax: +49 2626 9249845 Email: info@researchinaction. de © 2015, Research In Action Gmb. H Reproduction Prohibited 19