Organizations consider application oversight a low priority and app portfolio knowledge is poor:
- No dedicated or centralized effort to manage the app portfolio means no single source of truth is available to support informed decision making.
- Organizations acquire more applications over time, creating redundancy, waste, and the need for additional support.
- Organizations are more vulnerable to changing markets. Flexibility and growth are compromised when applications are unadaptable or cannot scale.
Our Advice
Critical Insight
- You cannot outsource application strategy.
- Modern software options have lessened the need for organizations to have robust in-house application management capabilities. But your applications’ future and governance of the portfolio still require centralized oversight to ensure the best overall return on investment.
- Application portfolio management is the mechanism to ensure that the applications in your enterprise are delivering value and support for your value streams and business capabilities. Understanding value, satisfaction, technical health, and total cost of ownership are critical to digital transformation, modernization, and roadmaps.
Impact and Result
Build an APM program that is actionable and fit for size:
- Understand your current state, needs, and goals for your application portfolio management.
- Create an application and platform inventory that is built for better decision making.
- Rationalize your apps with business priorities and communicate risk in operational terms.
- Create a roadmap that improves communication between those who own, manage, and support your applications.
Member Testimonials
After each Info-Tech experience, we ask our members to quantify the real-time savings, monetary impact, and project improvements our research helped them achieve. See our top member experiences for this blueprint and what our clients have to say.
9.3/10
Overall Impact
$31,749
Average $ Saved
19
Average Days Saved
Client
Experience
Impact
$ Saved
Days Saved
Anne Arundel Community College
Guided Implementation
10/10
$61,999
20
Bloomfield Hills Schools
Guided Implementation
10/10
N/A
N/A
VCU Health System Authority
Guided Implementation
9/10
N/A
35
Strathcona County
Guided Implementation
8/10
$1,500
3
Braeston Proprietary Limited
Guided Implementation
7/10
N/A
N/A
Toronto and Region Conservation Authority
Guided Implementation
10/10
$10,000
5
Greenheck Fan Corporation
Guided Implementation
6/10
$6,197
1
Lane Council of Governments
Guided Implementation
10/10
$61,999
105
CLO-OCOL
Workshop
9/10
N/A
N/A
Clark Pacific
Guided Implementation
10/10
N/A
N/A
Western Forest Products Inc.
Guided Implementation
7/10
N/A
N/A
Natural Resources Canada
Guided Implementation
10/10
N/A
N/A
MicroPort Orthopedics Inc.
Workshop
4/10
N/A
N/A
Westconsin Credit Union
Workshop
10/10
$12,399
20
Twin Disc
Guided Implementation
9/10
N/A
2
One Call Care Management
Workshop
9/10
N/A
20
State of Ohio - Ohio Department of Developmental Disabilities
Guided Implementation
10/10
$10,000
5
Apega
Guided Implementation
8/10
N/A
N/A
University of Exeter
Guided Implementation
10/10
N/A
N/A
University of Western States
Guided Implementation
10/10
N/A
10
Natural Resources Canada
Workshop
8/10
$14,500
16
Montgomery County Board of County Commissioners
Guided Implementation
10/10
$6,366
35
Tokyo Electron US Holdings, Inc.
Guided Implementation
8/10
N/A
N/A
City Colleges of Chicago
Guided Implementation
4/10
N/A
N/A
MUFG Bank Mexico Sociedad Anonima Institucion de Banca Multiple Filial
Guided Implementation
10/10
N/A
N/A
Workshop: Application Portfolio Management Foundations
Workshops offer an easy way to accelerate your project. If you are unable to do the project yourself, and a Guided Implementation isn't enough, we offer low-cost delivery of our project workshops. We take you through every phase of your project and ensure that you have a roadmap in place to complete your project successfully.
Module 1: Lay Your Foundations
The Purpose
- Work with key corporate stakeholders to come to a shared understanding of the benefits and aspects of application portfolio management.
Key Benefits Achieved
- Establish the goals of APM.
- Set the scope of APM responsibilities.
- Establish business priorities for the application portfolio.
Activities
Outputs
Define goals and metrics.
- Set short- and long-term goals and metrics.
Define application categories.
- Set the scope for applications.
Determine steps and roles.
- Set the scope for the APM process.
Weight value drivers.
- Defined business value drivers.
Module 2: Improve Your Inventory
The Purpose
- Gather information on your applications to build a detailed inventory and identify areas of redundancy.
Key Benefits Achieved
- Populated inventory based on your and your team’s current knowledge.
- Understanding of outstanding data and a plan to collect it.
Activities
Outputs
Populate inventory.
- Initial application inventory
Assign business capabilities.
- List of areas of redundancy
Review outstanding data.
- Plan to collect outstanding data
Module 3: Gather Application Information
The Purpose
Work with the application subject matter experts to collect and compile data points and determine the appropriate disposition for your apps.
Key Benefits Achieved
- Dispositions for individual applications
- Application rationalization framework
Activities
Outputs
Assess business value.
- Business value score for individual applications
Assess end-user perspective.
- End-user satisfaction scores for individual applications
Assess TCO.
- TCO score for individual applications
Assess technical health.
- Technical health scores for individual applications
Assess redundancies.
- Feature-level assessment of redundant applications
Determine dispositions.
- Assigned dispositions for individual applications
Module 4: Gather, Assess, and Select Dispositions
The Purpose
- Work with application delivery specialists to determine the strategic plans for your apps and place these in your portfolio roadmap.
Key Benefits Achieved
- Prioritized initiatives
- Initial application portfolio roadmap
- Ongoing structure of APM
Activities
Outputs
Prioritize initiatives
- Prioritized new potential initiatives.
Populate roadmap.
- Built an initial portfolio roadmap.
Determine ongoing APM cadence.
- Established an ongoing cadence of APM activities.
Build APM action plan.
- Built an action plan to complete APM activities.
Application Portfolio Management Foundations
Ensure your application portfolio delivers the best possible return on investment.
Analyst Perspective
You can’t outsource accountability.
Many enterprises place little to no emphasis on managing their application portfolio, often due to a perceived need to focus on solely on operations and at the cost of strategic efforts.
Inevitably, application sprawl puts any organization in a position where they have more applications than they need, can afford, or can adequately support. Abandoning strategic competencies only adds to the high demands of keeping the lights on.
Others believe business managed or purchased applications do not warrant the same demand for governance or strategic oversight.
You can outsource development, you can even outsource maintenance, but you cannot outsource accountability for the portfolio. Someone needs to capture the holistic picture to determine if an application’s value is worth its cost and if the application does not have overt risk.
Ben Mackle
Senior Research Analyst, Small Enterprises
Info-Tech Research Group
Build your APM journey map
APM Foundations
- Step 0: APM Snapshot (optional)
- Application Portfolio Snapshot: Determine where APM is most needed (capabilities, business areas or functions, customer groups) and build a case for your APM program.
- Steps 1-3: Application Portfolio Management Foundations
- APM Foundations: Ensure your application portfolio delivers the best possible return on investment.
Enterprise APM
- Step 1: Complete APM Foundations Above
- Consider starting with APM Snapshot to build your case or determine where application rationalization can provide the most immediate value.
- Use APM Foundations to start rationalization and modernization for your most important applications or highest need areas before expanding to enterprise APM.
- Step 2: Rationalize Your Applications
- Build a Rationalization Framework: Use your inventory to align your application architecture to your IT and business strategy.
- Step 3: Modernize Your Applications
- Modernize Your Applications: Modernize your application portfolio using business and technical perspectives. Build your communication strategy and presentation.
Is this research right for you?
Research Navigation
Managing your application portfolio is essential regardless of its size or whether your software is purchased or developed in house. Each organization must have some degree of application portfolio management to ensure that applications deliver value efficiently and that their risk or gradual decline in technical health is appropriately limited.
Your APM Goals | If this describes your primary goal(s) |
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Executive Summary
Your Challenge
- Organizations consider application oversight a low priority and app portfolio knowledge is poor.
- No dedicated or centralized effort to manage the app portfolio means no single source of truth is available to support informed decision making.
- Organizations acquire more applications over time, creating redundancy, waste, and the need for additional support.
- Organizations are more vulnerable to changing markets. Flexibility and growth is compromised when applications are unadaptable or cannot scale.
Common Obstacles
- APM implies a holistic approach and compiling multiple priorities and perspectives.
- Organizations have limited time to act strategically or proactively and need to be succinct.
- Uncertainties on business value prevent IT from successfully advising software decision making.
- IT knows its technical debt but struggles to get the business to act on technical risks.
- Attempts at exposing these problems rarely gain buy-in and discourage the push for improvement.
Info-Tech's Approach
- Think low priority over no priority.
- Integrate these tasks into your mixed workload.
- Create an inventory built for better decision making.
- Rationalize your apps in accordance with business priorities and communicate risks on their terms.
- Create a roadmap that improves communication between those who own, manage, and support an application.
- Build your APM process fit for size.
Info-Tech Insight: You can’t outsource strategy.
Modern software options have decreased the need for organizations to have robust in-house application management capabilities. Your applications’ future and governance of the portfolio still requires a centralized IT oversight to ensure the best return on investment.
Every organization experiences some degree of application sprawl
Application Sprawl:
Inefficiencies within your application portfolio are created by the gradual and non-strategic accumulation of applications.
“You have more apps than you need.”
Only 34% of software is rated as both important and effective by users. (Info-Tech’s CIO Business Vision)
Causes of Sprawl
Poor Lifecycle Management
Turnover & a Lack of Knowledge Transfer
Siloed Business Units & Decentralized IT
Business Managed IT (Shadow IT)
Mergers & Acquisitions
Problems With Sprawl
Redundancy and Inefficient Spending
Disparate Apps & Data
Obsolescence
Difficulties in Prioritizing Support
Barriers to Change & Growth
The top IT challenges for SE come from app management
Having more applications than an organization needs means unnecessarily high costs and additional burden on the teams who support the applications. Especially in the case of small enterprises, this is added pressure the IT team cannot afford.
A poorly maintained portfolio will eventually hurt the business more than it hurts IT.
Legacy systems, complex environments, or anything that leads to a portfolio that can’t adapt to changing business needs will eventually become a barrier to business growth and accomplishing objectives. Often that blame is put on the IT department.
56% of small businesses cited inflexible technology as a barrier for growth (Salesforce as quoted by Tech Republic, 2019)
#1 challenge small enterprise owners face in their use of technology: | |
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Taking appropriate security precautions | 24% |
The costs of needed upgrades to technology | 17% |
Time it takes to fix problems | 17% |
The cost of maintaining technology | 14% |
Lack of expertise | 9% |
Breaks in service | 7% |
(National Small Business Association, 2019)
The hidden and inefficient application portfolio is the root cause of so many pains experienced by both IT and the business.
- Demand/Capacity Imbalance
- Overspending
- Security and Business Continuity Risk
- Delays in Delivery
- Barriers to Growth
APM allows you to better understand and set the direction of your portfolio
Application Portfolio Management (APM):
The ongoing practice of:
- Providing visibility into applications across the organization.
- Recommending corrections or enhancements to decision makers.
- Aligning delivery teams on priority.
- Showcasing the direction of applications to stakeholders.
Application Alignment
The process of revealing application information through interviewing stakeholders and aligning to business capabilities.
Application Rationalization
The process of collecting information and assessing your applications to determine recommended dispositions.
Application Inventory
The artifact that documents and informs the business of your application portfolio.
Application Roadmap
The artifact that showcases the strategic directions for your applications over a given timeline.
Build your APM maturity by taking the right steps at the right time
Info-Tech’s Build an Application Rationalization Framework provides additional TCO and value tools to help build out your portfolio strategy.
The core activity of APM is application rationalization

Application rationalization requires the collection of several data points that represent these perspectives and act as the criteria for determining a disposition for each of your applications.
Disposition: The intended strategic direction or implied course of action for an application.
APM comes at a justified cost
The benefits of APM
Return on investment (ROI) is experienced by the reduction in the number of applications and operational costs. But other benefits can include:
- Reduce redundancies
- Reduce risk
- Reduce complexity
- Improve processes
- Enable flexibility
- Enable scalability
Executive Brief Case Study
INDUSTRY - Retail
SOURCE - Deloitte
Supermarket Company
The grocer was a smaller organization for the supermarket industry with a relatively low IT budget. While its portfolio consisted of a dozen applications, the organization still found it difficult to react to an evolving industry due to inflexible and overly complex legacy systems.
The IT manager found himself in a scenario where he knew the applications well but had little awareness of the business processes they supported. Application maintenance was purely in keeping things operational, with little consideration for a future business strategy.
As the business demanded more responsiveness to changes, the IT team needed to be able to react more efficiently and effectively while still securing continuity of the business.
The IT manager found success by introducing APM and gaining a better understanding of the business use and future needs for the applications. The organization started small but then increased the scope over time to produce and develop techniques to aid the business in meeting strategic goals with applications.
Results
The IT manager gained credibility and trust within the organization. The organization was able to build a plan to move away from the legacy systems and create a portfolio more responsive to the dynamic needs of an evolving marketplace.
The Application Portfolio Management Initiative included the following components:
Train teams and stakeholders on APM
Model the core business processes
Collect application inventory
Assign APM responsibilities
Start small, then grow
Info-Tech’s methodology for Small Enterprise APM
1. Lay Your Foundations | 2. Improve Your Inventory | 3. Rationalize Your Apps | 4. Populate Your Roadmap | |
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Phase Activities |
1.1 Assess Your Portfolio 1.2 Define Goals and Metrics 1.3 Define Application Categories 1.4 Determine Steps and Roles 1.5 Weight Value Drivers |
2.1 Populate Inventory 2.2 Assign to Business Capabilities 2.3 Review Outstanding Data |
3.1 Assess Business Value 3.2 Assess End-User Perspective 3.3 Assess TCO 3.4 Assess Technical Health 3.5 Assess Redundancies 3.6 Determine Dispositions |
4.1 Prioritize Initiatives 4.2 Populate Roadmap 4.3 Determine Ongoing APM Cadence |
Phase Outcomes |
Work with the appropriate management stakeholders to:
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Gather information on your own understanding of your applications to build a detailed inventory and identify areas of redundancy. | Work with application subject matter experts to collect and compile data points and determine the appropriate disposition for your apps. | Work with application delivery specialists to determine the strategic plans for your apps and place these in your portfolio roadmap. |
Blueprint deliverables
Each step of this blueprint is accompanied by supporting deliverables to help you accomplish your goals.
Key deliverable:
Blueprint Storyboard
This is the PowerPoint document you are viewing now. Follow this guide to understand APM and how to use the tools, and build a repeatable APM process captured in your playbook.
Application Portfolio Management Foundations Playbook
This template allows you to capture your APM roles and responsibilities and build a repeatable process.
Application Portfolio Management Foundations Tool
This tool stores all relevant application information and allows you to execute rationalization and build a portfolio roadmap.
Info-Tech offers various levels of support to best suit your needs
DIY Toolkit
"Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful."
Guided Implementation
"Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track."
Workshop
"We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place."
Consulting
"Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project."
Diagnostics and consistent frameworks are used throughout all four options.
Guided Implementation
What does a typical GI for on this topic look like?
Phase 1
Call #1: Establish goals and foundations for your APM practice.
Phase 2
Call #2: Initiate inventory and determine data requirements.
Phase 3
Call #3: Initiate rationalization with group of applications.
Call #4: Review result of first iteration and perform retrospective.
Phase 4
Call #5: Initiate your roadmap and determine your ongoing APM practice.
A Guided Implementation (GI) is a series of calls with an Info-Tech analyst to help implement our right-sized best practices in your organization.
A typical GI, using our materials, is between 4 to 6 calls over the course of 2 to 3 months.
Workshop Overview
Contact your account representative for more information.
workshops@infotech.com 1-888-670-8889
Day 1 | Day 2 | Day 3 | Day 4 | Day 5 | |
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Activities | 1. Lay Your Foundations 1.2 Define Goals and Metrics 1.3 Define Application Categories 1.4 Determine Steps and Roles 1.5 Weight Value Driers | 2. Improve Your Inventory 2.1 Populate Inventory 2.2 Assign to Business Capabilities 2.3 Review Outstanding Data | 3. Rationalize Your Applications 3.1 Assess Business Value 3.2 Assess End-User Perspective 3.3 Assess TCO 3.4 Assess Technical Health 3.5 Assess Redundancies 3.6 Determine Dispositions | 4. Populate Your Roadmap 4.1 Prioritize Initiatives 4.2 Populate Roadmap 4.3 Determine Ongoing APM Cadence 4.4 Build APM Action Plan | Next Steps and Wrap-Up (offsite) 5.1 Complete in-progress deliverables from previous four days. 5.2 Set up review time for workshop deliverables and to discuss next steps. |
Outcomes | Work with the appropriate management stakeholders to:
| Work with your applications team to:
| Work with the SMEs for a subset of applications to:
| Work with application delivery specialists to:
| Info-Tech analysts complete:
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Blueprint Pre-Step: Get the right stakeholders to the right exercises
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Lay Your Foundations
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Improve Your Inventory
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Rationalize Your Apps
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Populate Your Roadmap
Recommended APM Lead
- Applications Lead or the individual responsible for application portfolio management, along with any applications team members if available
Key Corporate Stakeholders
Depending on size and structure, participants could include:
- Head of IT (CIO, CTO, IT Director, or IT Manager)
- Head of shared services (CFO, COO, VP HR, etc.)
- Compliance Officer, Steering Committee
- Company owner or CEO
Application Subject Matter Experts
Individuals who have familiarity with a specific subset of applications.
- Business owners (product owners, Head of Business Function, power users)
- Support owners (Operations Manager, IT Technician)
Delivery Leads
- Development Managers
- Solution Architects
- Project Managers
Phase 1
Lay Your Foundations
Phase Participants
- Applications Lead
- Key Corporate Stakeholders
Additional Supporting Resources
Review the different motivations of APM
What has instigated the need for an improved APM initiative?
Portfolio Governance
Improves:
- Spending efficiency
- Risk
- Retirement of aged and low-value applications
- Business enablement
Impact on your rationalization framework:
- Less urgent
- As rigorous as appropriate
- Apply in-depth analysis as needed
Transformative Initiatives
Enables:
- Data migration or harmonization
- Legacy modernization
- Infrastructure/cloud migration
- Standardizing platforms
Impact on your rationalization framework:
- Time sensitive
- Scope on impacted areas
- Need to determine specific dispositions
- Outcomes need to include detailed and actionable steps
Event-Driven Rationalization
Responds to:
- Mergers and acquisitions
- Regulatory and compliance change
Impact on your rationalization framework:
- Time constrained
- Lots of discovery work
- Primary focus on duplication
Different motivations will influence the appropriate approach and urgency of APM, or specifically, rationalizing the portfolio. When rationalizing is directly related to enabling or in response to a broader initiative, you will need to create a more structured approach with a formal budget and resources.
APM supports many goals
Building an APM process requires a proper understanding of the underlying business goals and objectives of your organization’s strategy. Effectively identifying these drivers is paramount to gaining buy-in and the approval for any changes you plan to make to your application portfolio.
After identifying these goals, you will need to ensure that they are built into the foundations of your APM process.
“What is most critical?” but also “What must come first?”
Discover
- Collect Inventory
- Uncover Shadow IT
- Uncover Redundancies
- Anticipate Upgrades
- Predict Retirement
Improve
- Reduce Cost
- Increase Efficiency
- Reduce Applications
- Eliminate Redundancy
- Limit Risk
Transform
- Improve Architecture
- Modernize
- Enable Scalability
- Drive Business Growth
- Improve UX
1.1 Assess your current application portfolio with Info-Tech’s diagnostic tool
Input
- Current APM program
- Application landscape
Output
- APM current state assessment
Materials
- Application Portfolio Management Diagnostic Tool
Participants
- Applications Lead
Estimated Time: 1 Hour
- This tool provides visibility into your application portfolio and APM practices.
- Based on your assessment, you should gain a better understanding of whether the appropriate next steps are in application discovery, rationalization, or roadmapping.
- Complete the “Data Entry” worksheet in the Application Portfolio Management Diagnostic Tool (Excel).
- Review the “Results” worksheet to help inform and guide your next steps.
Download the Application Portfolio Management Diagnostic Tool
1.1 Assess your current application portfolio with Info-Tech’s diagnostic tool
Portfolio Visibility - Estimate the extent of your shadow IT problem
Application Sprawl Factors - Identify the contributing factors to application sprawl
Application Information - Identify what information you are lacking
Application Portfolio Management State - Determine the current state of your APM practice
1.2 Define goals and metrics
Input
- Overarching organizational strategy
- IT strategy
Output
- Defined goals and metrics for APM
Materials
- Whiteboard
- Markers
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Key Corporate Stakeholders
Estimated Time: 1 Hour
- Determine the motivations behind APM. You may want to collect and review any of the organization’s strategic documents that provide additional context on previously established goals.
- With the appropriate stakeholders, discuss the goals of APM. Try to label your goals as either:
- Short term: In this context, refers to more immediate goals used to represent the progress of APM activities. Likely these goals are more IT oriented.
- Long term: In this context, refers to broader and more distant goals more related to the impact of APM. These goals tend to be more business oriented.
- To help clearly define your goals, discuss appropriate metrics for each goal. Often these metrics can be expressed as:
- Leading indicators: Metrics used to gauge the success of your short-term goals and the progress of APM activities.
- Lagging indicators: Metrics used to gauge the success of your long-term goals.
Record the results in the APM Snapshot and Foundations Tool
1.2 Define goals and metrics: Example
Goals | Metric | Target | ||
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Short Term | Improve ability to inform the business | Leading Indicators |
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Improve ownership of applications |
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Reduce costs of portfolio |
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Long Term |
Migrate platform | Lagging Indicators |
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Improve overall satisfaction with portfolio |
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Become more “customer-centric” |
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“Application” doesn’t have the same meaning to everyone
APM focuses on business applications
“Software used by business users to perform a business function.” (ServiceNow, 2020)
Unfortunately, that definition is still quite vague.
“Essentially applications are social constructions.” (Martin Fowler)
Code
A body of code that's seen by developers as a single unit.
Functionality
A group of functionality that business customers see as a single unit.
Funding
An initiative that those with the money see as a single budget.
What else?
You must set boundaries and scope for “application”
1. Many individual items can be considered an application on their own or a component within or associated with an application.
Apps can be categorized by aspects of your architecture or tech stack
- Interface
- Presentation Layer
- UI
- Software Component
- Middleware
- API
- Supporting Software
- Micro Service
- Data Access/Transfer/Load
- Platform
- Database
- Operating System
Apps can be categorized by the application family
- Parent Application
- Package
- Suite
- Child Application
- Module
- Component (Functional)
2. Different categories of applications may be out of scope or handled differently within the activities and artifacts of APM.
Apps can be categorized by generic categories
- Enterprise Applications
- Productivity Tools
- Customer-Facing Applications
- Mobile Applications
- Unique Function-Specific Applications
Apps can be categorized by bought vs. built or install types
- Custom
- Off the Shelf
- Hybrid
- On-Prem
- SaaS
- End-User-Built Tools
Apps can be categorized by management group
- IT Managed Applications
- Business Managed Applications (Shadow IT)
- Partner/External Applications
Apps can be categorized by tiers
- Mission Critical
- Tier 2
- Tier 3
Set boundaries on what is an application or the individual unit that you’re making business decisions on. Also, determine which categories of applications are in scope and how they will be included in the activities and artifacts of APM.
1.3 Define application categories
Input
- Working list of applications
Output
- Definitions and guidelines for which application categories are in scope for APM
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Key Corporate Stakeholders
Estimated Time: 1 Hour
- Define a business application. Reviewing the items listed on the previous slide, consider what systems should not be considered a “business application” on their own and may deserve their own category.
- Identify the additional categories you need to manage in your application portfolio.
- For each category, establish or modify a description or definition and provide examples that exist in your current portfolio.
- For each category, answer:
- Will these be documented in the application inventory?
- Will these be included in application rationalization? Think about if this item will be assigned a TCO, value score, and ultimately, a disposition.
- Will these be listed in the application portfolio roadmap?
Include any additional notes to further clarify scope and guidelines.
If you completed Deliver Digital Products at Scale, use your product families to help define your application categories.
1.3 Define application categories: Example
Category | Definition/Description | Examples | Documented in your application inventory? | Included in application rationalization? | Listed in your application portfolio roadmap? |
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Business Application | End-user facing applications that directly enable specific business functions. This includes enterprise-wide and business-function-specific applications. Separate modules will be considered a business application when appropriate. | ERP system, CRM software, accounting software | Yes | Yes. Unless currently in dev. TCO of the parent application will be divided amongst child apps. | Yes |
Software Components | Back-end solutions are self-contained units that support business functions. | ETL, middleware, operating systems | No. Documentation in CMDB. These will be listed as a dependency in the application inventory. | No. These will be linked to a business app and included in TCO estimates and Tech Health assessments. | No |
Productivity Tools | End-user-facing applications that enable standard communication of general document creation. | MS Word, MS Excel, corporate email | Yes | No | Yes |
End-User- Built Microsoft Tools | Single instances of an MS tool that the business has grown dependent on. | Payroll Excel tool, Access databases | No. Documentation in Business Tool Glossary. | No | No |
Partner Applications | Partners or third-party applications that the business has grown dependent on, but internally owned or managed. | Supplier’s ERP portal, government portal | No | No | Yes |
Shadow IT | Business-managed applications. | Downloaded tools | Yes | Yes. However, just from a redundancy perspective. | Yes |
The roles in APM rarely exist; you need to adapt
Application Portfolio Manager
- Responsible for the health and evolution of the application portfolio.
- Facilitates the rationalization process.
- Compiles and assesses application information and recommends and supports key decisions regarding the direction of the applications.
- This is rarely a dedicated role even in large enterprises. For small enterprises, this should be an IT employee at a manager level – an IT manager or operations manager.
Support Owner
- Responsible for the maintenance and management of individual applications.
- Provides technical information subject matter expertise for the assessment of an application.
- For small enterprises, this would be those responsible for maintaining the application and those responsible for its initial implementation. Often support responsibilities are external, and this role will be more of a vendor manager.
Business Owner
- Responsible for managing individual applications on a functional level and approves and prioritizes projects.
- Provides business process or functional subject mater expertise for the assessment of applications.
- For small enterprises, this role is rarely defined, but the responsibility should exist. Consider the head of a business unit or a process owner as the owner of the application.
Project Portfolio Manager
- Responsible for intake, planning, and coordinating the resources that deliver any changes.
- The body that consumes the results of rationalization and begins planning any required action or project.
- For small enterprises, the approval process can come from a steering committee but is often less formal. Often a smaller group of project managers facilitates planning and coordination and works closely with the delivery leads.
Corner-of-the-Desk Approach
- No one is explicitly dedicated to building a strategy or APM practices.
- Information is collected whenever the application team has time available.
- Benefits are pushed out and the value is lost.
Dedicated Approach
- The initiative is given a budget and formal agenda.
- Roles and responsibilities are assigned to team members.
The high-level steps of APM present some questions you need to answer
Build Inventory
Create the full list of applications and capture all necessary attributes.
- Who will build the inventory?
- Do you know all your applications (Shadow IT)?
- Do you know your applications’ functionality?
- Do you know where your applications overlap?
- Who do you need to consult with to fill in the gaps?
- Who will provide specific application information?
Collect & Compile
Engage with appropriate SMEs and collect necessary data points for rationalization.
- Who will collect and compile the necessary data points for rationalization?
- What are the specific data points?
- Are some of the data points currently documented?
- Who will provide specific data points on technical health, cost, performance, and business value?
- Who will determine what business value is?
Assess & Recommend
Apply rationalization framework and toolset to determine dispositions.
- Who will apply a rationalization tool or decision-making framework to generate dispositions for the applications?
- Who will modify the tool or framework to ensure results align to the goals of the organization?
- Who will define any actions or projects that result from the rationalization?
- And who needs to be consulted to assess the feasibility of any potential project?
Validate & Roadmap
Present dispositions for validation and communicate any decisions or direction for applications.
- Who will present the recommended disposition, corrective action, or new project to the appropriate decision maker?
- Who is the appropriate decision maker for application changes or project approval?
- What format is recommended (idea, proposal, business case) and what extra analysis is required?
- Who needs to be consulted regarding the potential changes?
1.4 Determine steps and roles (SIPOC)
Input
- Existing function and roles regarding application delivery, management, and ownership
Output
- Scope of APM
- Responsibilities assigned to your roles
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Key Corporate Stakeholders
Estimated Time: 1 Hour
- Begin by comparing Info-Tech’s common roles of APM to the roles that exist in your organization with respect to application management and ownership.
- There are four high-level steps for APM: build inventory, collect & compile, assess & recommend, and validate & roadmap. Apply the SIPOC (Supplier, Input, Process, Output, Customer) model by completing the following for each step:
- In the Process column, modify the description, if necessary. Identify who is responsible for performing the step.
- In the Inputs column, modify the list of inputs (materials, knowledge, etc.).
- In the Suppliers column, identify who must be included to provide the inputs.
- In the Outputs column, modify the list of outputs (materials, artifacts, results, outcomes, etc.).
- In the Customers column, identify who must be included to provide the inputs.
- (Optional) Add one last step outlining how the results of APM will be consumed. For example, project intake or execution, data or platform migration, application or product management, or whichever is appropriate.
1.4 Determine steps and roles
Suppliers | Inputs | Process | Outputs | Customers |
---|---|---|---|---|
|
|
Build Inventory Create the full list of applications and capture all necessary attributes. Resp: Applications Manager & IT team member |
|
|
|
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Collect & Compile Engage with appropriate SMEs and collect necessary data points for rationalization. Resp: IT team member |
|
|
|
|
Assess & Recommend Apply rationalization framework and toolset to determine dispositions. Resp: Applications Manager |
|
|
|
|
Validate & Roadmap Present dispositions for validation and communicate any decisions or direction for applications. Resp: Applications Manager |
|
|
|
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Project Intake Build business case for project request. Resp: Project Manger |
|
|
Assessing application business value
In this context… business value is the value of the business outcome that the application produces. Additionally, how effective the application is at producing that outcome.
Business value IS NOT the user’s experience or satisfaction with the application.
Business Value of Applications
- The Business
- Keepers of the organization’s mission, vision, and value statements that define IT success. The business maintains the overall ownership and evaluation of the applications.
- IT
- Technical subject matter experts of the applications they deliver and maintain. Each IT function works together to ensure quality applications are delivered to stakeholder expectations.
First, the authorities on business value need to define and weigh their value drivers that describe the priorities of the organization.
This will then allow the applications team to apply a consistent, objective, and strategically aligned evaluation of applications across the organization.
Review the value drivers of your applications
Business Value Matrix
Financial vs. Human Benefits
Financial benefits refer to the degree to which the value source can be measured through monetary metrics and are often quite tangible.
Human benefits refer to how an application can deliver value through a user’s experience.
Inward vs. Outward Orientation
Inward refers to value sources that have an internal impact and improve your organization’s effectiveness and efficiency in performing its operations.
Outward refers to value sources that come from your interaction with external factors, such as the market or your customers.
Perceived business benefits from using digital tools
- Increase Sales and Revenue (38%)
- Promote Brand Awareness (31%)
- Access New Customers (30%)
- Connect with Customers (30%)
- Improve External Communication (29%)
- Improve Internal Communication (20%)
- Target Market Segments (20%)
- Improve Business Flexibility (18%)
- Compete With Larger Businesses (17%)
- Streamline Sales and Lead Generation (13%)
- Lower Business Costs (12%)
- Support Innovation (9%)
Increased Revenue
Application functions that are specifically related to the impact on your organization’s ability to generate revenue and deliver value to your customers.
Reduced Costs
Reduction of overhead. The ways in which an application limits the operational costs of business functions.
Enhanced Services
Functions that enable business capabilities that improve the organization’s ability to perform its internal operations.
Reach Customers
Application functions that enable and improve the interaction with customers or produce market information and insights.
1.5 Weigh value drivers
Input
- Knowledge of organizational priorities
- (Optional) Existing mission, vision, and value statements
Output
- Scoring scheme for assessing business value
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Key Corporate Stakeholders
Estimated Time: 1 Hour
- Review Info-Tech’s four quadrants of business value: increase revenue, reduce costs, enhance services, and reach customers. If appropriate, adapt this language to meet your organization’s orientation. For example, government organizations often use obtain funding or reach public.
- (Optional) Add an additional value driver if your organization has distinct value drivers. For example, compliance, sustainability, innovation, and growth.
- For each value driver, provide some examples of key indictors specific to your organization’s priorities.
- For each value driver, weigh it on a scale of 1 to 5 based on its relative importance to the organization. Aim to have some variance in the weighting of the value drivers.
Download the APM Snapshot and Foundations Tool
1.5 Weigh value drivers: Example
Example:
Value Driver | Weight |
---|---|
Generate Revenue
|
5 |
Reduce Costs
|
3 |
Enhance Services
|
2 |
Reach Customers
|
4 |
Abide Compliance
|
2 |
How it gets applied via the balanced scorecard:
ERP | Impact (Established by applications lead and consultations with business owners) | Weight (Set by key corporate stakeholder) | Weighted scores |
---|---|---|---|
Generate Revenue | Very High – 5 | 5 | 25 |
Reduce Costs | Very High – 5 | 3 | 15 |
Enhance Services | Medium – 3 | 2 | 6 |
Reach Customers | Medium – 1 | 4 | 4 |
Abide Compliance | Very Low – 1 | 2 | 2 |
Balanced Score: | 52 |
CRM | Impact | Weight | Weighted scores |
---|---|---|---|
Generate Revenue | Medium – 3 | 5 | 15 |
Reduce Costs | Very Low – 1 | 3 | 3 |
Enhance Services | Low – 2 | 2 | 4 |
Reach Customers | Very High – 5 | 4 | 20 |
Abide Compliance | Very High – 5 | 2 | 4 |
Balanced Score: | 46 |
For additional support building and implementing a balanced value framework, download Build a Value Measurement Framework.
Phase 2
Improve Your Inventory
Phase Participants
- Applications Lead
- Applications Team
Additional Resources
Phase pre-step: Collect your applications
- Consult with your IT team and leverage any existing documentation to gather an initial list of your applications.
- Build an initial working list of applications. This is just meant to be a starting point. Aim to include any new applications in procurement, implementation, or development.
- Phases 3 and 4 (rationalization and road mapping) are best completed when iteratively focusing on manageable groups of applications. Group your applications into subsets based on shared subject matter experts. Likely this will mean grouping applications by business units.
- Select a subset to be the first group of applications that will undergo the activities of phases 3 and 4.
If you completed Deliver Digital Products at Scale, use your product families and products to help define your applications.
What information do you need to make available?
Foundational
- Application name
- Description
- Criticality
- Ownership
- SMEs
- Application specs
- # of users
- Vendor information
- Capabilities
More examples in Appendix
Intended to inform stakeholders
Mostly captured though basic data collection methods or interviewing owners and SMEs.
Advanced
- Redundancies
- Total cost of ownership (TCO)
- Business value
- Performance
- Risk
- Dependencies
Intended to drive strategic decision making
Captured though deeper analysis and may require additional tools outside of an inventory.
Strategic
- Lifecycle stage
- Scheduled updates
- Disposition/strategic direction
- Planned of in-flight projects
- Business case info
Intended to showcase application strategies
Captured and presented though planning activities; will require additional tools.
Info-Tech Best Practice
The more information you plan to capture, the larger the time and effort, especially as you move along toward advanced and strategic items. Capture the information most aligned to your objectives to make the most of your investment.
2.1 Populate your inventory
Input
- Working list of applications
Output
- Determined attributes for inventory
- Populated inventory
Materials
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Any Applications Team Members
- Review Info-Tech’s list of application inventory attributes.
- Open the Application Inventory Details tab of the APM Snapshot and Foundations Tool. Modify, add, or omit attributes as appropriate in row 8.
- Add your working list of applications to column C.
- For each application, populate data fields in columns D-V (excluding business capability for now). Complete this as best as you can based on your, or your team’s, familiarity with or any readily available documentation related to these applications.
Why is the business capability so important?
For the purposes of an inventory, business capabilities help all stakeholders gain a sense of the functionality the application provides.
However, the true value of business capability comes with rationalization. Upon linking all the organization’s applications to a standardized and consistent set of business capabilities, you can then group your applications based on similar, complementary, or overlapping functionality. In other words, find your redundancies and consolidation opportunities.
Important Consideration
Defining business capabilities and determining the full extent of redundancy is a challenging undertaking and often is a larger effort than APM all together.
Business capabilities should be defined according to the unique functions and language of your organization, at varying levels of granularity, and ideally including target-state capabilities that identify gaps in the future strategy.
This blueprint provides a simplified and generic list for the purpose of categorizing similar functionality. We strongly encourage exploring Document Your Business Architecture to help in the business capability defining process, especially when visibility into your portfolio and knowledge of redundancies is poor.
Marketing (Business Unit)
- Market Assessment (Business Capability)
- Application A (Enabling Application)
- Competitive Intelligence
- Application A
- Campaign Mgmt.
- Application B
- Collaboration
- Application C
- Customer Segmentation
- Application D
- Customer Experience Mgmt.
- Application D
In this scenario, applications C and E and applications D and F have similar or overlapping functionality and should be made candidates for consolation.
Customer Mgmt.
- Account Mgmt.
- Application E
- Analysis and Reporting
- Application F
- Customer Experience Mgmt.
- Application F
- Collaboration
- Application E
Why perform a high-level application alignment before rationalization?
Having to address redundancy complicates the application rationalization process. There is no doubt that assessing applications in isolation is much easier and allows you to arrive at dispositions for your applications in a timelier manner.
Rationalization has two basic steps: first, collect and compile information, and second, analyze that information and determine a disposition for each application. When you don’t have redundancy, you can analyze an application and determine a disposition in isolation. When you do have redundancies, you need to collect information for multiple applications, likely across departments or lines of business, then perform a comparative analysis.
Most likely your approach will fall somewhere between the examples below and require a hybrid approach.
Benefits of a high-level application alignment:
- Review the degree of redundancy across your portfolio.
- Understand the priority areas for rationalization and the sequence of information collection.
2.2 Align to business capabilities
Input
- Application inventory
- Any existing list of business capabilities or an Info-Tech Reference Architecture
Output
- Assigned business capabilities to applications
- Areas of redundancy
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Any Applications Team Members
1 hour
- If your organization has already defined a high-level set of capabilities, collect this information and use these for the following exercise.
- Review Info-Tech’s Industry Reference Architectures for example lists of business capabilities.
- Modify the language or adapt business capabilities as appropriate. Add a definition to the business capability to provide clarity. Create an initial list of business capabilities in your playbook, updating as you go.
- Open the APM Snapshot and Foundations Tool to the Application Inventory tab. For each application, align it to the high-level business capabilities that apply and document in column G. Complete this as best as you can based on your, or your team’s, familiarity with or any readily available documentation related to these applications.
- Note all instances of multiple applications supporting one business capability. These are potential redundancies and will be important information for phase 3.
2.2 Align to business capabilities example
Application | Business Capability |
---|---|
CRM | Customer Relationship Management |
ERP |
Warehouse Management Distribution Management Supply Chain Management Finance Management |
Microsoft Suite | Productivity |
HRIS | Human Resources Management |
Jabber | Collaboration |
Legacy |
Workflow Management Distribution Management |
Excel Custom-Built App | Finance Management |
Adobe | Product Design |
Custom Data Tracker | Operations Management |
CRM 2 | Customer Relationship Management |
CRM 3 | Customer Relationship Management |
Area of redundancy #1
Customer Relationship Management |
---|
CRM 1 |
CRM 2 |
CRM 3 |
Area of redundancy #2
Distribution Management |
---|
ERP |
Legacy |
2.3 Review outstanding data
Input
- Application inventory
Output
- List of outstanding data points
- Collection methods for outstanding data points
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Any Applications Team Members
30 minutes
- Upon an initial attempt at aligning your application to business capabilities and populating your application inventory, evaluate your, or your team's ability, to provide this information on your applications. For each attribute consider:
- Were you able to provide necessary data or information?
- Is that data up to date and accurate?
- If the answer for either 1) or 2) is no, determine what collection method or additional action will be applied to capture the data or information. This can include:
- Basic validation with appropriate SMEs
- Structured interviews with business owners (often integrated with the collection of application rationalization data points)
- Surveys with owners, key users, or full user base
- Structured interviews with technical SMEs
- Consultation with vendors
- Auto-discovery or system scanning tools
- Business capability or process mapping initiative
2.3 Review outstanding data
Application Attribute | Have you captured the data or information? | Is the data or information up to date and accurate? | Additional Steps or Collection Methods |
---|---|---|---|
Description | Partially | Partially | Validate with business owners or vendors |
Business Units |
Yes | Yes | Validate with heads of business units |
Business Capabilities | No | n/a | Modify capabilities list with executive team, and interview business owners |
Criticality | Partially | Uncertain | Review BCP and validate with business owners |
Ownership | No | n/a | Assign “business owner” role to appropriate individuals |
Application SMEs | Informally | Yes | Inform SMEs of their role |
Vendor Information | Yes | Yes | Review contracts |
Type | Yes | Yes | No action necessary |
Active Status | Yes | Yes | No action necessary |
Number of Users | No | n/a | Interview business owners and consult with vendors |
Software Dependencies | No | n/a | Complete process mapping initiative |
Hardware Dependencies | Partially | Interview solutions architect | |
Platform | Yes | Yes | No action necessary |
Phase 3
Rationalize Your Applications
Phase Participants
- Applications Lead
- Application SMEs
Additional Resources
Phase pre-step: Sequence rationalization assessments appropriately
Application rationalization requires an iterative approach.
- Review your application subsets from the Phase 2 pre-step. Review the areas of redundancies from exercise 2.2.
- Sequence the activities of phase 3 based on whether you have a:
- Highly Redundant Portfolio
- For each subset of applications iteratively complete exercises 3.1-3.5.
- Complete exercise 3.6.
- Complete exercise 3.7.
- Non-Redundant Portfolio
- For each subset of applications iteratively complete exercises 3.1-3.4 and 3.7.
- Moderately Redundant Portfolio
- Complete assessment of your application subsets that feature redundant apps first following “a)” instructions.
- Complete assessment of your application subsets that do not feature redundant apps second, following “b)” instructions.
- Highly Redundant Portfolio

Phase pre-step: Are the right stakeholders present?
Application rationalization requires specific stakeholders to provide specific data points.
- Ensure your application subsets are grouped by shared subject matter experts. Ideally these are grouped by business units.
- For each subset, identify the appropriate SMEs for the five areas of rationalization criteria.
- Communicate and schedule interviews with groups of stakeholders. Inform them of additional information sources to have readily available.
- (Optional) This phase’s activities follow the clockwise sequence of the diagram to the right. Reorder the sequence of activities based on overlaps of availability in subject matter expertise.
- Application Rationalization
- Additional Information Sources:
- KPIs
- Ideal Stakeholders:
- Business Value
- Business Application/Product Owners
- Business Unit/ Process Owners
- Ideal Stakeholders:
- Survey Results
- Ideal Stakeholders:
- End User
- Business Application/Product Owners
- Key/Power Users
- End Users
- Ideal Stakeholders:
- General Ledger
- Service Desk
- Vendor Contracts
- Ideal Stakeholders
- TCO
- Operations/Maintenance Manager
- Vendor Managers
- Finance & Acct.
- Ideal Stakeholders
- Service Desk
- ALM Tools
- Ideal Stakeholders
- Technical Health
- Operations/ Maintenance Manager
- Solution Architect
- Security Manager Dev. Manager
- Ideal Stakeholders
- Capability Maps
- Process Maps
- Ideal Stakeholders
- Application Alignment
- Business Unit/ Process Owners
- Ideal Stakeholders
- KPIs
- Additional Information Sources:
The core outcome of rationalization is dispositions
Disposition: The intended strategic direction or course of action for an application.
Determine your dispositions using five key criteria
There are many lenses, or perspectives, to view your applications through. Rationalize your applications using a holistic understanding to determine the most beneficial direction or course of action.
Application Portfolio Manager
Business Value
- Is the application producing sufficient business outcomes?
- Does it impact profitability, enable capabilities, or add any critical factor that fulfills the mission and vision?
- CEO Perspective
End User
- How does the end user perceive the application?
- What is the user experience?
- Do the features adequately support the intended functions?
- User Perspective
TCO
- What is the overall cost of the application?
- What is the projected cost as your organization grows?
- What is the cost to maintain the application?
- CFO Perspective
Technical Health
- What is the state of the backend of the application?
- Has the application maintained its quality?
- Is the application reliable and secure?
- How does it fit into your application architecture?
- IT Perspective
Application Alignment
- How well does the entire portfolio align to your business capabilities?
- Are there overlaps or redundancies in your application features?
- Covered in Application Portfolio Snapshot.
- Architect Perspective
Application Portfolio
Apply Info-Tech’s 7 R’s Rationalization Disposition Model
Disposition | Description | Call to Action (Priority) |
---|---|---|
Reward High Value High Health High Satisfaction |
Prioritize new features or enhancement requests and openly welcome the expansion of these applications as new requests are presented. | Process Initiative (Moderate) |
Remediate High Value Low Health High Satisfaction |
Address the poor technical health or risk with a prioritized project. Further consult with development and technical teams to determine if migration or refactoring is suited to address the technical issue. | Application Initiative (Very High) |
Retain Low Value High Health High Satisfaction |
Potentially cancel or lower priority of new features and enhancement requests. Aim to "keep the lights on" and delay decommission if the app doesn’t present risk or high operational costs. | Process Initiative (Very Low) |
Retire Low Value, Low Health. High or Low Satisfaction |
Cancel any requested features and enhancements. Schedule proper decommission and transfer end users onto new or alterative system if necessary. | Decommission (Low) |
Refresh High Value High Health Low Satisfaction |
Address the poor end-user satisfaction with a prioritized project. Further consult with business owners to determine if UX issues require refactoring or retraining. | Application Initiative (High) |
Replace High Value Low Health Low Satisfaction |
Replace High Value Low Health Low Satisfaction | Decommission & App Initiative (Very High) |
Review High Value High Health Low Satisfaction |
Explore if the user issues are impacting the value. | Potential App Initiative (Very low) |
TCO, compared relatively to business value, helps determine the practicality of a disposition and the urgency of any call to action. Application alignment is factored in when assessing redundancies and has a separate set of dispositions.
Reduce subjectivity, increase consistency, and measure multiple kinds of value
Application’s Balanced Value Score
- Increase Revenue (5)
- Moderate (3)
- Creates new accounts
- Provides some revenue
- Moderate (3)
- Reduce Costs (2)
- Low (1)
- Automates account management
- Low (1)
- Enhance Services (2)
- N/A (0)
- No internal learning or growth
- N/A (0)
- Reach Customer (3)
- Very High (5)
- Provides customer interaction Houses customer data
- Very High (5)
Business value can be ambiguous but is essential in making the right decisions for your apps.
The purpose of applying a balanced scorecard is to measure value using an approach that is:
- Consistent
- Less subjective
- Aligned to business priorities
With the “authorities on business value” setting the weight and definition of your value drivers, you can now assess the value of individual applications.
3.1 Assess business value
Input
- Weight of value drivers
- Familiarity of business value for applications within this subset
- KPIs
Output
- Balanced value scores for each application
Materials
- APM Snapshot and Foundations Tool
Participants
- Business Owners
- Applications Lead
- Any Applications Team Members
30-60 minutes
- Open the Rationalization Inputs tab in the APM Snapshot and Foundations Tool. Carry over the value driver weights from exercise 1.4 into row 9, columns E-I.
- For each application, score on a scale of 0 to 5 how impactful the application is for each value driver. Use the indicators set in phase 1 to guide your scoring.
- Review outstanding application attributes from exercise 2.3. Use this opportunity to validate or collect specific data points from the business owners of the applications.
End users provide valuable perspective
Your end users are your best means of determining front-end issues.
SATISFACTION
Satisfaction refers to the sentiment your end users have with the features and functionality of the application. Do the features of the application function as intended? Does the application align to the business process it aims to support?
USABILITY
Usability refers to the level of ease and intuitiveness your end users have with the application’s user experience. Does the design of the application allow end users to perform their tasks with relative ease or minimal disruption?
Info-Tech Best Practice
When facing large user groups, do not make assumptions or use lengthy methods of collecting information. Use Info-Tech’s Application Portfolio Assessment to collect data by surveying your end users’ perspectives.
3.2 Assess end-user perspective
Input
- Familiarity of end user’s perspective for applications within this subset
Output
- User satisfaction scores for each application
Materials
- APM Snapshot and Foundations Tool
Participants
- Business Owners, Key Users
- Applications Lead
- Any Applications Team Members
30-60 minutes
- For each application, score on a scale of 1 to 5 how impactful the application is for:
- Satisfaction: How satisfied are end users with the features of this application?
- Usability: How satisfied are end users that this application is easy to use and reliable?
- Review outstanding application attributes from exercise 2.3. Use this opportunity to validate or collect specific data points from the key users of the applications.
Consider the spectrum of application cost
$
- License
- Fixes
- Enhancements
- Education
- Peripherals
An app’s cost extends past a vendor’s fee and even the app itself.
LICENSING AND SUBSCRIPTIONS: Your recurring payments to a vendor. Many COTS applications require a license on a per-user basis. Review contracts and determine costs by looking at per-user or fixed rates charged by the vendor. Often these fees include support.
MAINTENANCE COSTS: Your internal spend to maintain an app. These stem from internal maintenance. Estimate these costs with past spend (salaries, wages, person hours worked) for your individual apps.
INDIRECT COSTS: Miscellaneous expenses necessary for an app’s continued use. Expenses like end-user training, developer education, and admin are often neglected, but they are very real costs organizations pay regularly.
The TCO assessment is one area where what you are considering the ”application” matters quite a bit. An application’s peripherals or software components need to be considered in your estimates.
3.3 Assess TCO
Input
- Familiarity of the TCO for applications within this subset
- Vendor contracts, maintenance history
Output
- TCO scores for each application
Materials
- APM Snapshot and Foundations Tool
Participants
- Business Owners, Vendor Managers, Operations Managers
- Applications Lead
- Any Applications Team Members
30-60 minutes
- For each application, score on a scale of 0 to 5 how large the application’s cost is for:
- License: Recurring payments to a vendor. If available, use vendor contracts or license documentation to guide your scoring.
- Maintenance: Internal spend to maintain an app. If available, use data from service desk or ALM tools to guide scoring.
- Indirect: Miscellaneous expenses necessary for an application's continued use.
- Review outstanding application attributes from exercise 2.3. Use this opportunity to validate or collect specific data points from the financial SMEs of the applications.
Understand the back end and technical health of your applications
Technical health is where IT presents the extent of technology risk the organization faces.
MAINTAINABILITY (RAS)
RAS refers to an app’s reliability, availability, and serviceability. How often, how long, and how difficult is it for your resources to keep an app afloat, and what are the resulting continuity risks? This can include root causes (e.g. technical debt, poor source code management).
SECURITY
Are there vulnerabilities with the application or a history of security incidents? Are there risks or threats that cannot be sufficiently mitigated? Remember that threats are often internal and non-malicious. Does the app allow for illegitimate use?
ADAPTABILITY
How easily can the app be enhanced or scale to changes in business needs? If an application is or has the potential to be a barrier to growth it needs to be dealt with. Does the app fit within the business strategy?
INTEROPERABILITY
The degree to which an app is integrated with current systems. Apps require comprehensive technical planning and oversight to ensure they connect within the greater application architecture. Does the app fit within the technology strategy?
3.4 Assess technical health
Input
- Familiarity of technical health perspective for applications within this subset
- Maintenance history, architectural models
Output
- Technical health scores for each application
Materials
- APM Snapshot and Foundations Tool
Participants
- Technical SMEs
- Applications Lead
- Any Applications Team Members
30-60 minutes
- For each application, score on a scale of 1 to 5 the application’s health for:
- Maintainability. To what degree is the application reliable, available, and serviceable?
- Security. To what degree is the application secure and meets security/compliance regulations?
- Adaptability. To what degree can the application handle changes in features or scale?
- Interoperability. To what degree is the application compatible with current or future-state software components and infrastructure?
- Review outstanding application attributes from exercise 2.3. Use this opportunity to validate or collect specific data points from support owners or technical SMEs of the applications.
Redundancies require a different analysis and set of dispositions
Solving application redundancy is a lot more complicated than simply keeping one application and eliminating the others.
First, you need to understand the extent of the redundancy. The applications may support the same capability, but do they offer the same functions? Determine which apps offer which functions within a capability. This means you cannot accurately arrive at a disposition until you have evaluated all applications.
Next, you need to isolate the preferred system. This is completed by comparing the same data points collected for rationalization and the application alignment analysis. Cost and coverage of all necessary functions become the more important factors in this decision-making process.
Lastly, for the non-preferred redundant applications you need to determine, what will you do with the users? What will you do with the data? And what can you do with the functionality (can the actual coding be merged onto a common platform)?
Disposition | Description & Additional Analysis | Call to Action (Priority) |
---|---|---|
Keep & Absorb Higher value, health satisfaction, and cost than alternatives |
These are the preferred apps to be kept. However, additional efforts are still required to migrate new users and data and potentially configure the app to new processes. | Application or Process Initiative (Moderate) |
Shift & Retire Lower value, health satisfaction, and cost than alternatives |
These apps will be decommissioned alongside efforts to migrate users and data to the preferred system. *Confirm there are no unique and necessary features. |
Process Initiative & Decommission (Moderate) |
Merge Lower value, health satisfaction, and cost than alternatives but still has some necessary unique features |
These apps will be merged with the preferred system onto a common platform. *Determine the unique and necessary features. *Determine if the multiple applications are compatible for consolidation. |
Application Initiative (Moderate) |
3.5 (Optional) Assess redundancies
Input
- Areas of redundancy
- Familiarity of features for applications within this subset
Output
- Feature-level review of application redundancy
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Business Owners
- Applications Lead
- Any Applications Team Members
1 hour
Reminder: This exercise is best performed after aligning business capabilities to applications across the portfolio and identifying your areas of redundancy in exercise 2.2. At this stage, this is still an information collection exercise and it will not yield a consolidation-based disposition until applied to all relevant applications. Lastly, this exercise may still be at too high a level to outline the full details of redundancy, but it is still vital information to collect and a starting point to determine which areas require more concentrated analysis.
- Determine which areas of redundancy have applications included in this subset.
- For each area of redundancy, identify the high-level features. Aim to limit the features to ten, grouping smaller features if necessary. SoftwareReviews can be a source of to identify common features.
- Label features using the MoSCoW model: must have, should have, should have, would have.
- For each application, document which features they provide.
3.5 (Optional) Assess redundancies
Account Management | Call Management | Order/ Transaction Processing | Contract Management | Lead/Opportunity Management | Forecasting/ Planning | Customer Surveying | Email Synchronization | |
---|---|---|---|---|---|---|---|---|
M | M | M | M | S | S | C | W | |
CRM 1 | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | |
CRM 2 | ✓ | ✓ | ✓ | ✓ | ||||
CRM 3 | ✓ | ✓ | ✓ |
3.6 (Optional) Determine dispositions for redundant applications
Input
- Feature-level review of application redundancy
- Redundancy comparison
Output
- Assigned dispositions for redundant applications
Materials
- APM Snapshot and Foundations Tool
Participants
- Business Owners
- Applications Lead
- Any Applications Team Members
30 minutes
Reminder: This activity is intended to be applied after you have performed exercises 3.1-3.5 for all applications related to an area of redundancy. Perform these steps for each area of redundancy.
- Review the results of 3.5 for your areas of redundancy. Based on the feature-level assessment, determine if you can omit applications if they don’t truly overlap with other applications.
- Open the Redundancy Comparison tab in the APM Snapshot and Foundations Tool. Add the relevant applications from the drop-down menu in column C.
- Determine the preferred application. Use the diagram to influence this decision. This may be the application closest the top right (strong health and value). However, less expensive options or any options that provide a more complete set of features may be preferable.
- Open the Rationalization Results tab. Assign a disposition to each application in column D.
- Some dispositions may imply a call to action, new project, or initiative. Ideate and/or discuss with the team any potential initiatives.
3.6 Determine dispositions
Input
- Rationalization results
Output
- Assigned dispositions for applications
Materials
- APM Snapshot and Foundations Tool
Participants
- Business Owners
- Applications Lead
- Any Applications Team Members
1 hour
- Open Rationalization Results tab in the APM Snapshot and Foundations Tool.
- Review the recommended disposition based on the application’s position and color on the 2x2 matrix.
- Question if that disposition is appropriate. Be sure to consider:
- TCO. Cost should come into play for any decisions. Review the implications in column AA to see specifically where cost should be taken into consideration.
- Alignment to strategic goals set for the overarching organizational, IT, technology (infrastructure), or application portfolio.
- Select a disposition for each application and enter in column D.
- Some dispositions may imply a call to action, new project, or initiative. Ideate and/or discuss with the team any potential initiatives.
Note: Modify the list of dispositions on the Disposition Options worksheet as appropriate for your rationalization initiative. Any modifications to the Disposition column will be automatically updated in the App Rationalization Results and Roadmap worksheets.
Phase 4
Populate Your Roadmap
Phase Participants
- Applications Lead
- Delivery Leads
Additional Resources
Roadmaps are used for different purposes
Roadmaps are used for different communication purposes and at varying points in your application delivery practice. Some use it to showcase strategy and act as a feedback mechanism that allows stakeholders to validate any changes (process 1). Others may use it to illustrate and communicate approved and granular elements of a change to an application to inform appropriate stakeholders of what to anticipate (process 2).
Select Dispositions & Identify New Initiatives →Add to Roadmap →Validate Direction →Plan Project →Execute Project
Select Dispositions & Identify New Initiatives →Project Proposal; Feasibility/ Estimation; Impact Assessment; Business Case; Initial Design →Approve Project →Add to Roadmap →Execute Project
The steps between selecting a disposition and executing on any resulting project will vary based on the organization’s project intake standards (or lack there of).
This blueprint focuses on building a strategic portfolio roadmap prior to any in-depth assessments related to initiative/project intake, approval, and prioritization. For in-depth support related to intake, approval, prioritization, or planning, review the following resources.
Determine what makes it onto the roadmap
A roadmap should not be limited to what is approved or committed to. A roadmap should be used to present the items that need to happen and begin the discussion of how or if this can be put into place. However, not every idea should make the cut and end up in front of key stakeholders.
Valuable
- The initiative will add value, reduce risk, or align with strategic goals.
Feasible
- The initiative is compatible and realistic given capacity, budget, or limitations.
Usable
- The initiative matches the end user’s needs and skill sets.
(Adapted from Product Coalition, 2017)
Don’t Add & Reconsider Disposition - When no discernable value can be identified, do not add.
Cautiously Add to Roadmap - When value exists, but the feasibility is questionable, add with the intention of further evaluation.
Accelerate Disposition - When valuable, feasible, and usable, add and prioritize the item.
4.1 Prioritize initiatives
Input
- Assigned dispositions
- Rationalization results
Output
- Prioritized initiatives
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Delivery Leads
- Applications Lead
- Any Applications Team Members
1 hour
Reminder: This is just a high-level assessment to provide a sense of feasibility, practicality, and priority and an estimated timeline of a given initiative. Do not get lost in granular estimations.
- Collect any new initiative ideas that result from rationalization. Group them into:
- Process Initiative: Any project or effort focused on process improvements without technical modification to an app (e.g. user migration, change in SLA, new training program). Write the application and initiative name on a blue sticky note.
- App Initiative: Any project or effort involving technical modification to an app (e.g. refactoring, platform migration, feature addition or upgrade). Write the application and initiative name on a yellow sticky note.
- Decommission Initiative: Any project and related efforts of removing an app (e.g. migrating data, removal from server). Write the application and initiative name on a red sticky note.
- Rate each initiative on a high, medium, and low scale based on its high-level estimated relative cost and effort. Be sure to consider initial and ongoing costs that the initiative would require.
4.1 Prioritize initiatives continued
- Rate each initiative on a high, medium, and low scale based on its potential benefit. Be sure to consider:
- Disposition: Review disposition matrix for which types are higher priority.
- Risk: Discuss high-risk applications and the initiative’s ability to limit risk.
- Current Cost: Large cost-saving opportunities should be higher priority.
- Strategic Alignment: How well does this initiative align to strategic goals?
- Plot each initiative on a diagram as seen on this slide. Use the top-right to bottom-left direction to determine priority. Determine which initiatives should not even be included on the portfolio roadmap.
4.2 Populate roadmap
Input
- Prioritized projects for applications
- Familiarity of resource capacity
Output
- Initial portfolio roadmap
Materials
- APM Snapshot and Foundations Tool
Participants
- Delivery Leads
- Applications Lead
- Any Applications Team Members
1 hour
Reminder, this is just a starting point and is meant be high level and strategic. Do not get lost in granular estimations.
- Open the Roadmap tab of APM Snapshot and Foundations Tool. Review the color scheme for different initiative types.
- For any applications that did not undergo rationalization, such as new or birth applications (in procurement, implementation, or development), add their timeline for their delivery and initial release or any other relevant milestones.
- Add any planned or in-flight initiatives associated with your existing applications. Add the timeline for the initiatives.
- Indicate any currently scheduled updates for your applications.
- Add new initiatives resulting from rationalization, starting with your top priorities. When estimating the time required for each initiative, be sure to consider.
- Effort (define assumptions related to unit of measure and elapsed time vs. actuals)
- Capacity
- Dependencies
4.2 Populate roadmap example
Create a recurring update plan
- Application inventories become stale before you know it. Build steps in your procurement process to capture the appropriate information on new applications. Also, build in check points to revisit your inventory on a regular basis to assess the accuracy of inventory data.
- Rationalization is not one and done; it must occur with an appropriate cadence.
- Business priorities change, which will impact the current and future value of your apps.
- Now more than ever, user expectations evolve rapidly.
- Application sprawl likely won’t stop, so neither will shadow IT and redundancies.
- Obsolescence, growing technical debt, changing security threats, or shifting technology strategies are all inevitable, as is the gradual decline of an app’s health or technical fit.
- An application’s disposition changes quicker than you think, and rationalization requires a structured cadence. You need to plan to minimize the need for repeated efforts. Conversely, many use proceeding iterations to increase the analysis (e.g. more thorough TCO projections or more granular capability-application alignment).
- Portfolio roadmaps require a cadence for both updates and presentations to stakeholders. Updates are often completed semi-annually or quarterly to gauge the business adjustments that affect the timeline of the domain-specific applications. The presentation of a roadmap should be competed alongside meetings or gatherings of key decision makers.
- M&A or other restructuring events will prompt the need to address all the above.
How frequently should you rationalize the portfolio and update your roadmap? | ||
---|---|---|
Small Portfolio |
Rationalize every 2 years Roadmap quarterly |
Rationalize every 2-3 years Roadmap every 2 years |
Large Portfolio |
Rationalize biannually Roadmap monthly |
Rationalize annually Roadmap annually |
Dynamic Strategy | Stable Strategy |
4.3 Ongoing APM cadence
Input
- Initial experience with APM
- Strategic meetings schedule
Output
- Ongoing cadence for APM activities
Materials
- Whiteboard and markers
- APM Snapshot and Foundations Tool
Participants
- Applications Lead
- Any Applications Team Members
1 hour
- Review the necessary frequency you will update or present the artifacts of your APM practice: Application Inventory, Application Rationalization Tool, and Application Roadmap.
- For each artifact, determine the:
- Owner: Who is accountable for the artifact and the data or information within the artifact and will be responsible for or delegate the responsibility of updating or presenting the artifact to the appropriate audience?
- Update Cadence: How frequently will you update the artifact? Include what regularly scheduled meetings this activity will be within.
- Update Scope: Describe what activities will be performed to keep the artifact up to date. The goal here is to minimize the need for a full set of activities laid out within the blueprint. (Optional) How will you expand the thoroughness of your analysis?
- Audience: Who is the audience for the artifact or assessment results?
- Presentation Cadence: How frequently will you present the artifact to the audience? Include what regularly scheduled meetings this activity will be within.
4.3 Ongoing APM cadence
Artifact | Owner | Update Cadence | Update Scope | Audience | Presentation Cadence |
---|---|---|---|---|---|
Inventory | Greg Dawson |
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Rationalization Tool | Judy Ng |
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Portfolio Roadmap | Judy Ng |
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Common application inventory attributes
Attribute | Description | Common Collection Method |
---|---|---|
Name | Organization’s terminology used for the application. | Auto-discovery tools will reveal names for the applications they reveal. However, this may not be the organizational nomenclature. You may adapt the names by leveraging pre-existing documentation and internal knowledge or by consulting business users. |
ID | Unique identifiers assigned to the application (e.g. app number). | Typically an identification system developed by the application portfolio manager. |
Description | A brief description of the application, often referencing core capabilities. | Typically completed by leveraging pre-existing documentation and internal knowledge or by consulting business users. |
Business Units | A list of all business units, departments, or user groups. | Consultation, surveys, or interviews with business unit representatives. However, this doesn’t always expose hidden applications. Application-capability mapping is the most effective way to determine all the business units/user groups of an app. |
Business Capabilities | A list of business capabilities the application is intended to enable. | Application capability mapping completed via interviews with business unit representatives. |
Criticality | A high-level grading of the importance of the application to the business, typically used for support prioritization purposes (i.e. critical, high, medium, low). | Typically the criticality rating is determined by a committee representing IT and business leaders. |
Ownership | The individual accountable for various aspect of the application (e.g. product owner, product manager, application support, data owner); typically includes contact information and alternatives. | If application ownership is an established accountability in your organization, typically consulting appropriate business stakeholders will reveal this information. Otherwise, application capability mapping can be an effective means of identifying who that owner should be. |
Application SMEs | Any relevant subject matter experts who can speak to various aspects of the application (e.g. business process owners, development mangers, data architects, data stewards, application architects, enterprise architects). | Technical SMEs should be known within an IT department, but shadow IT apps may require interviews with the business unit. Application capability mapping will determine the identity of those key users/business process SMEs. |
Type | An indication of whether the application was developed in-house, commercial off-the-shelf, or a hybrid option. | Consultation, surveys, or interviews with product owners or development managers. |
Active Status | An indication of whether the application is currently active, out of commission, in repair, etc. | Consultation, surveys, or interviews with product owners or operation managers. |
Common application inventory attributes
Attribute | Description | Common Collection Method |
---|---|---|
Vendor Information | Identification of the vendor from whom the software was procured. May include additional items such as the vendor’s contact information. | Consultation with business SMEs, end users, or procurement teams, or review of vendor contracts or license agreements. |
Links to Other Documentation | Pertinent information regarding the other relevant documentation of the application (e.g. SLA, vendor contracts, data use policies, disaster recovery plan). Typically includes links to documents. | Consultation with product owners, service providers, or SMEs, or review of vendor contracts or license agreements. |
Number of Users | The current number of users for the application. This can be based on license information but will often require some estimation. Can include additional items of quantities at different levels of access (e.g. admin, key users, power users). | Consultation, surveys, or interviews with product owners or appropriate business SMEs or review of vendor contracts or license agreements. Auto-discovery tools can reveal this information. |
Software Dependencies | List of other applications or operating components required to run the application. | Consultation with application architects and any architectural tools or documentation. This information can begin to reveal itself through application capability mapping. |
Hardware Dependencies | Identification of any hardware or infrastructure components required to run the application (i.e. databases, platform). | Consultation with infrastructure or enterprise architects and any architectural tools or documentation. This information can begin to reveal itself through application capability mapping. |
Development Language | Coding language used for the application. | Consultation, surveys, or interviews with development managers or appropriate technical SMEs. |
Platform | A framework of services that application programs rely on for standard operations. | Consultation, surveys, or interviews with infrastructure or development managers. |
Lifecycle Stage | Where an application is within the birth, growth, mature, end-of-life lifecycle. | Where an application is within the birth, growth, mature, end-of-life lifecycle. |
Scheduled Updates | Any major or minor updates related to the application, including the release date. | Consultation with business owners and vendor managers. |
Planned or in-Flight Projects | Any projects related to the application, including estimated project timeline. | Consultation with business owners and project managers. |
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