Businesses with high levels of IT observability gain a 2.6x annual return on their investments across areas like operational efficiency and uptime, according to the latest research from Splunk, the cybersecurity and observability firm.

Observability, the ability to measure the internal state of a system by examining its outputs, particularly sensor data, is used across IT, software development, and business operations to allow IT teams to get to the root cause of a variety of  issues and improve a system’s performance. 

According to data published in Splunk’s State of Observability 2024 report, as many as 87% of organisations now employ specialists who work exclusively on the practice, while nearly half (47%) say they use observability tools, up from 36% a year ago, with most deploying an average of 23 different tools for both modern and legacy tech.

In their poll of 1,850 IT operations staff, Splunk found that 68% of firms with mature observability said that they’re aware of application problems within minutes or seconds of an outage – 2.8 times faster than organisations with lower levels of observability. 

Research shows that 44% of downtime incidents are caused by application or infrastructure issues, such as software failures, costing companies up to 9% in stock price losses from a single incident. As a result, quickly identifying and resolving system issues has become a top priority for businesses, with 86% reporting they plan to increase their observability investments.

Speed also gives businesses with high observability an edge in software development. Among firms with mature observability, 76% can deploy the majority of their application code on demand, in contrast to 30% of firms with lower observability, leading to developers spending 38% more time on innovation, opposed to troubleshooting and triaging incidents. 

The study also discovered that OpenTelemetry, an open-source, industry-standard for collecting data, is becoming more widely adopted, with 72% of IT leaders using the software to access a broader ecosystem of technologies, and 65% saying the open-source nature facilitates better control and ownership of data.

Over half of firms (58%) said that their observability solution relies on OpenTelemetry, and 57% reported that using it lowered their observability costs.

Recommended reading

• 75% of Enterprises Push Ahead With AI, Despite Data Governance Concerns
• Is Financial Services The Sector Most Prepared For AI?
• 64% of People Don’t Want Companies to Use AI in Customer Service

Nearly all survey respondents (97%) reported using AI or ML-powered systems to enhance their observability operations, a jump from 66% last year. Of those that use AI and ML, 57% agreed that the volume of alerts they receive is problematic, but that hasn’t stopped 65% leaning on AIOps to pinpoint and remediate the root cause of incidents. 

“Building a leading observability practice means being obsessed with delivering incredible digital experiences to your customers, and embedding that mindset into every decision,” said Patrick Lin, senior VP of observability at Splunk.

“Our report shows this mindset pays off. Leaders not only achieve greater success in mitigating downtime, they also see greater developer innovation and speed.”