• Guide Content

Application Performance Monitoring Tools: 4 Key Capabilities

What Are Application Performance Monitoring Tools? 

Application performance monitoring (APM) tools are software solutions designed to monitor and manage the performance and availability of software applications. They provide real-time insights into the application’s operations, helping to detect, diagnose, and resolve performance issues before they impact the user experience. 

APM tools track various metrics related to application performance, including response times, error rates, and throughput, across different components of the application architecture, such as the frontend, backend, and underlying infrastructure.

The significance of APM tools has grown with the complexity of modern software applications, which often run in dynamic, distributed environments like cloud platforms and microservices architectures. By offering visibility into the intricate web of interactions within these applications, APM tools help developers and IT operations teams identify bottlenecks, understand dependencies, and pinpoint the root causes of performance issues.

This is part of a series of articles about microservices monitoring.

Key Capabilities of APM Tools 

1. Real-Time Performance Monitoring

Real-time performance monitoring is a fundamental feature of APM tools, enabling immediate visibility into the operational health of applications. This capability allows teams to monitor application performance metrics as they occur, facilitating quick detection of anomalies or degradation in service. 

By accessing real-time data, IT professionals can proactively address issues before they escalate into more significant problems, minimizing potential downtime or adverse effects on the user experience. Real-time monitoring encompasses a broad range of metrics, including transaction times, system resource utilization, and user interactions, providing a comprehensive view of application performance at any given moment.

Learn more in our detailed guide to cloud native monitoring 

2. Error Tracking and Diagnostics

Error tracking and diagnostics enable teams to swiftly identify, analyze, and rectify errors within applications. These capabilities provide detailed insights into the nature and source of errors, from minor glitches affecting individual users to critical issues impacting the entire application. 

By automating the detection and classification of errors, APM tools help reduce the time and effort required to diagnose problems, allowing for quicker resolution and recovery. Detailed diagnostic information, including stack traces, user sessions, and performance metrics, aids developers in understanding the context of errors, facilitating effective troubleshooting.

Furthermore, error tracking and diagnostics features often include anomaly detection algorithms that can alert teams to unusual patterns or spikes in errors, indicating potential problems before they become widespread.

3. Application Dependency Mapping

Application dependency mapping provides a visual representation of the relationships and dependencies between different components of an application. This includes mapping the connections between microservices, databases, external APIs, and other infrastructure elements that the application relies on. 

Dependency mapping helps teams understand how components interact and depend on each other, making it easier to identify the root cause of performance issues or failures. By visualizing the application architecture, teams can quickly pinpoint bottlenecks or problematic components that may be affecting overall performance. 

Application dependency mapping is invaluable during planning and scaling activities, as it allows for informed decision-making regarding infrastructure changes, updates, and optimizations.

4. Customizable Dashboards and Alerts

Customizable dashboards and alerts are essential features of APM tools, enabling teams to tailor monitoring and notification systems to their specific needs. Dashboards provide a centralized view of performance metrics, error rates, and other key indicators, allowing for quick assessment of application health. 

Customization options allow teams to highlight the most critical data, ensuring that important information is always front and center. This tailored approach helps streamline monitoring efforts, making it easier to keep track of application performance across different environments and services. Customizable alerts ensure that teams receive timely, relevant notifications, allowing for rapid response to prevent or minimize impact.

Use Cases for APM Tools 

Performance Optimization

APM tools are instrumental in performance optimization, providing the insights needed to fine-tune applications for optimal efficiency and user experience. By continuously monitoring application performance metrics, APM tools help identify inefficiencies, such as slow response times, resource bottlenecks, and underperforming components. This data enables developers and operations teams to make informed decisions about where to focus optimization efforts, whether it’s refining code, adjusting configurations, or scaling resources.

Performance optimization also involves balancing resource utilization to ensure that applications run smoothly without unnecessary expenditure on infrastructure. APM tools assist in this process by highlighting areas where resources are underutilized or overburdened, allowing teams to adjust allocations accordingly. This not only improves application performance but also helps manage costs effectively, ensuring that resources are used efficiently.

Troubleshooting and Incident Response

APM tools play a critical role in troubleshooting and incident response by providing the necessary insights to quickly identify and resolve application performance issues. 

When an application experiences a slowdown or failure, APM tools offer detailed performance data and error diagnostics that help pinpoint the root cause of the problem. This enables IT teams to efficiently troubleshoot issues, reducing the time it takes to recover from incidents. The real-time monitoring capabilities of APM tools also allow for the immediate detection of anomalies, enabling teams to respond proactively to emerging issues before they escalate.

Furthermore, APM tools facilitate post-incident analysis, helping teams understand what went wrong and why. By analyzing data collected before, during, and after an incident, organizations can identify patterns, vulnerabilities, and areas for improvement. This information is invaluable for refining incident response strategies, improving application design, and preventing future issues.

Application Migration

Application migration, particularly when moving from on-premises infrastructure to the cloud or between cloud environments, is a complex process that benefits greatly from APM tools. These tools provide visibility into application performance and behavior in the existing environment, establishing a baseline that can be used to ensure a smooth transition. 

During and after the migration, APM tools continue to monitor application performance, identifying any discrepancies or issues that may arise from the new environment. This enables teams to address problems promptly, minimizing downtime and ensuring that the application meets performance expectations post-migration.

APM tools also help in capacity planning and resource allocation for the migrated application, ensuring that it is optimized for the new environment. By analyzing performance data, teams can make informed decisions about how to scale resources in the cloud, avoiding overprovisioning and inefficiencies.

Learn more in the detailed guide to application migration

Ensuring SLA Compliance

SLAs define the performance and availability standards that service providers must meet, and APM tools enable organizations to monitor these metrics in real time. By continuously tracking application performance against SLA criteria, APM tools help identify any deviations from agreed-upon standards, allowing for immediate corrective action. This proactive approach to SLA compliance helps maintain high levels of service quality, minimizing the risk of penalties or reputational damage due to SLA breaches.

APM tools also provide detailed reporting capabilities, enabling organizations to document their compliance with SLAs. This transparency builds trust with customers and stakeholders, demonstrating a commitment to maintaining high standards of performance and reliability. Moreover, the insights gained from monitoring SLA metrics can support continuous improvement.

How to Choose the Right APM Tool 

Compatibility with Technology Stack

Choosing the right APM tool starts with assessing compatibility with the organization’s technology stack. It’s essential to select an APM solution that integrates seamlessly with the existing infrastructure, applications, and services. This includes compatibility with programming languages, frameworks, databases, and cloud platforms used by the organization. A tool that matches the technology stack ensures that teams can monitor and manage application performance effectively, without gaps in visibility or functionality.

Additionally, considering future technology adoption plans is crucial when evaluating APM tools. The chosen solution should be flexible and adaptable to evolving technology needs, supporting new languages, architectures, and deployment models as the organization grows and changes. This forward-looking approach ensures that the APM tool remains a valuable asset over time, capable of accommodating emerging technologies and trends.

Depth of Analysis

The depth of analysis provided by an APM tool is a key consideration in the selection process. Organizations should look for solutions that offer comprehensive insights into application performance, including detailed metrics, error diagnostics, and transaction tracing. 

A tool that can drill down into the root cause of performance issues and provide actionable intelligence is invaluable for effective troubleshooting and optimization. The depth of analysis should extend across all components of the application, from the frontend user interface to backend services and the underlying infrastructure.

Moreover, advanced analytical capabilities, such as predictive analytics and anomaly detection, can enhance the value of an APM tool. These features help anticipate performance issues before they impact users, enabling proactive management of application health.


Scalability is a crucial factor to consider when choosing an APM tool. As organizations grow and their application environments become more complex, the selected APM solution must be able to scale accordingly. This means being able to monitor an increasing number of applications, services, and infrastructure components without degradation in performance or usability. Scalability also involves the ability to handle large volumes of data generated by application monitoring, ensuring that insights remain timely and relevant.

Evaluating the scalability of an APM tool involves considering both its architectural design and its licensing model. The tool should be built to scale horizontally, adding resources as needed to accommodate growth. Additionally, the licensing model should be flexible, allowing organizations to expand their monitoring capabilities without prohibitive costs.

Cost and Licensing

Cost and licensing are critical considerations when selecting an APM tool. Organizations must assess the total cost of ownership, including initial acquisition costs, implementation expenses, and ongoing fees for maintenance and support. 

A transparent and straightforward licensing model is preferable, providing clarity on what features and capabilities are included and how pricing scales with usage or growth. It’s important to balance cost considerations with the tool’s features and benefits, ensuring that the chosen solution offers the necessary functionality at a reasonable price.

Additionally, evaluating different pricing models, such as subscription-based or usage-based pricing, can help organizations find an APM tool that aligns with their budget and financial planning. Considering potential cost savings from improved application performance, such as reduced downtime and increased efficiency, can also inform the decision-making process. 

Microservices Monitoring with Lumigo

Lumigo is a cloud native observability tool, purpose-built to navigate the complexities of microservices. Through automated distributed tracing, Lumigo is able to stitch together the distributed components of an application in one complete view and track every service of every request. Taking an agentless approach to monitoring, Lumigo sees through the black boxes of third parties, APIs, and managed services.

With Lumigo users can:

  • See the end-to-end path of a transaction and full system map of applications
  • Monitor and debug third party APIs and managed services (ex. Amazon DynamoDB, Twilio, Stripe)
  • Go from alert to root cause analysis in one click
  • Understand system behavior and explore performance and cost issues 
  • Group services into business contexts

Get started with a free trial of Lumigo for your microservice applications