Balancing Cost and Performance in IT

Balancing Cost and Performance in IT: Strategies for Efficient, Scalable, and Reliable Operations

Executive Summary

As organizations increasingly rely on technology to drive business outcomes, balancing IT system costs with performance has become crucial. This white paper delves into the strategic approaches companies can adopt to optimize IT spending while achieving high-performance systems. Drawing on Crossjoin’s extensive experience with Tier 1 telecom and financial services clients – but applicable to any industry that has complex IT – we present frameworks, methodologies, and real-world case studies that illustrate how organizations can strike this balance effectively. Through structured IT control, observability, and a robust Performance Management Framework (PMF), companies can ensure operational efficiency, reliability, and alignment with business objectives, all while managing or lowering costs in both cloud and on-premises environments.

About Crossjoin Solutions

Founded with a commitment to helping businesses achieve seamless IT control, Crossjoin Solutions has over 15 years of experience as a trusted strategic IT partner. We serve more than 30 international clients, 68% of whom are Tier 1 telecom and financial services companies. Our expertise lies in comprehensive IT Control, where we guarantee efficient, secure, and resilient operations across IT infrastructures. Crossjoin’s approach ensures that IT systems not only perform reliably but do so with predictable costs, helping clients achieve scalable growth while reducing/maintaining CAPEX and OPEX costs.

What is IT Control?

IT Control is an end-to-end strategy for managing and optimizing IT systems. It integrates observability, DevSecOps, infrastructure management, architecture design, and operations optimization to align IT performance with business objectives. Crossjoin’s IT Control strategy emphasizes efficiency and predictability, reducing risks and costs while supporting growth and scalability. This approach covers both cloud, multi-cloud, on-premises and hybrid environments, addressing each stage from architecture to KPIs and continuous optimization. IT Control serves as the foundation of Crossjoin’s Performance Management Framework (PMF), a structured methodology designed to address the complex demands of modern IT ecosystems.

The Cost-Performance Equation

There is a generalized perception that the challenge lies in balancing IT systems performance vis-a-vis the growing costs of infrastructure and operations. This perception is that higher systems performance – faster applications, better response times, and scalability – require substantial investment in hardware, cloud resources, and added operational expense. 

– 87% of Performance issues are not caused by lack of infrastructure: Crossjoin’s analysis of past projects reveals that most software performance problems are not due to inadequate infrastructure. Most performance issues arise from suboptimal practices rather than infrastructure shortages.

Most likely Root Causes for Performance Issues

Crossjoin has identified several recurring causes of performance issues across projects, emphasizing that infrastructure is only part of the equation. The primary culprits include:

•  Lack of Load Testing (41%): Many issues arise from insufficient scenario tuning and load testing, leading to unexpected performance bottlenecks.
•  Bad Coding and Engineering Practices (28%): Inefficient code and engineering practices often lead to slow, resource-intensive applications.
•  Inefficient Software Architecture (18%): Poor architectural design can lead to cascading performance problems, requiring costly and time-consuming fixes down the line.
•  Infrastructure Sizing (13%): Although infrastructure is frequently considered the main cause of performance issues, inadequate sizing accounts for a smaller portion of problem

Most of the time, optimizing software architecture, coding practices, together with load testing can often address performance needs more effectively than increasing infrastructure spend.
These findings reinforce the need for a proactive approach to performance management that addresses root causes rather than defaulting to hardware or cloud upgrades as a primary solution.

The Cost of Neglecting Performance in Program Management

In the fast-paced world of IT performance must be a priority from the very beginning of any program. Failure to address performance at the outset can lead to significant delays, cost overruns, and potential reputational damage. Crossjoin’s experience across numerous projects shows that treating performance as an afterthought often results in severe and avoidable consequences.

Consequences of Neglecting Performance

• Program Delays Due to Poor Coding and Testing: Without robust coding standards and load testing, projects can face delays averaging 3 months. This setback is often compounded by the need for last-minute corrections, further delaying deployment.
• Architectural Design Issues: A flawed software architecture can cause program delays of up to 6 months. Proper architecture design, aligned with performance requirements, ensures that programs are scalable and efficient from the start.
• Increased Risk of Program Cancellation: When performance problems accumulate, the risk of project cancellation rises by 30%, as stakeholders lose confidence in the program’s viability.
• Cost Escalations: Performance issues can drive program costs up by an estimated 35%. This includes costs associated with additional testing, redesign, infrastructure, and staffing to address performance induced delays that could have been prevented.
• Reputational Impact: Both vendors and operators suffer reputational harm when projects underperform or fail to meet performance expectations. Maintaining a reputation for reliability is crucial.

Performance is a fundamental requirement, not an afterthought.

Crossjoin advocates for incorporating performance standards into every stage of program development, from design and coding to testing and deployment. By treating performance as a core requirement, organizations can avoid costly delays, reduce risk, and ensure project success.

Performance-Aware Program Management

Crossjoin’s approach to performance management involves developing a performance-focused roadmap that encompasses requirements, KPIs, architecture, and observability. The steps in this methodology include:

Before the program starts
1. Defining Requirements: Establishing clear performance, scalability, security, and reliability requirements to ensure alignment with business goals.

During program setup
2. Performance Baseline and Observability: Setting a performance baseline, implementing observability tools, and designing load tests to assess and maintain system health.

During the development phase
3. Automated Testing and Continuous Improvement: Utilizing CI/CD pipelines with load and performance testing to address issues early and streamline development.

After go-live
4. Continuous Root Cause Analysis (RCA): Performing ongoing RCA to identify and resolve performance issues, ensuring continuous improvement across hybrid environments, following the pattern below:

This structured approach helps organizations proactively manage performance while keeping costs in check, enabling them to scale operations without compromising on efficiency.

Case Studies

1. Infrastructure Cost Reduction – Tier 1 Telco

Challenge: With a €2.7 million increase in cloud IT infrastructure costs, the client sought to reduce expenses without impacting system availability or performance.

Solution: Crossjoin led initiatives to decommission redundant applications, optimize server storage, and manage server resources more effectively.

Outcome: Achieved €2.17 million in savings, reducing cloud infrastructure costs by over 31%. The client continues to benefit from ongoing cost management support to maintain and enhance savings over time.

2. Credit Notes Process Optimization – Tier 1 Telco

Challenge: The client’s complex credit notes processing, involving seven interconnected systems, suffered from severe performance bottlenecks, leading to delays.

Solution: Crossjoin deployed a SPA (Solution Performance Architect) to monitor and optimize the process, reducing throughput time significantly.

Outcome: Processing time was cut from 8 hours to less than 1 hour, increasing throughput by 1500% while saving $300K in software and hardware upgrades. This improvement reduced operational costs, eliminated delays, and met critical performance targets.

3. System Scalability – Tier 1 Telco

Challenge: Support for the client’s company in solving critical issues in three key areas: Oracle RODOD and Digital Channels.

Solution:  Crossjoin carried out work that included firefighting, process optimization, operational resilience and performance tuning and certification, ensuring smooth monthly launches and successful projects

Outcomes:

Improvements in the Oracle RODOD stack:

• 85% reduction in month-end billing processes.
• 99% improvement in notifications sending.
• 200% faster invoice generation.
• >50% decrease in response time for critical Siebel journeys.
• 70% reduction in mediation CDR processing time.

  Improvements in Digital Channels:

• 3x more requests with the same infrastructure.
• 85% performance increase.
• 60% reduction in mobile app load time.
• 80% decrease in the number of P1 tickets.

Conclusion

Balancing cost with IT performance is essential for organizations that rely on technology to drive business outcomes. Crossjoin’s Performance Management Framework and IT Control methodologies offer a structured, proactive approach to achieving this balance. By focusing on optimization, end-to-end observability, and continuous performance monitoring and optimization, Crossjoin helps organizations maintain high-performance IT environments while controlling costs. Companies that adopt these principles are well-equipped to scale efficiently and sustain long-term growth.