Application Portfolio Rationalization Declutter your ...

[Pages:7]Application Portfolio Rationalization Declutter your application landscape

March 2016

Application Portfolio Rationalization (APR)

High IT complexity slows down business by limiting flexible reaction to changed client expectations and requirements

A long history of "good reasons"...

...has led to high IT complexity...

"Good reasons" include...

High IT complexity means...

? Managing IT in "silos"

? Incomplete M&A integrations

? Lack of architecture governance

? Rushed implementation

? Applications & technologies ? Many ? Disparate ? Outdated ? Redundant

? Misalignment between business need and IT capabilities

? 2016 Deloitte Consulting GmbH

...which is negatively impacting the business.

Negative impacts include...

? Business growth limited through IT limitations ? time to market too slow

? Inconsistent user and client experience ? Media breaches, inefficient operations ? High and increasing IT cost ? Need to retain legacy know how ? Inappropriate CTB/RTB ratio ? Lack of coherent data ? High IT and business risk ? Decreasing quality of IT application support,

inacceptable service levels ? Need to maintain legacy know how

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APR Placement

Rationalization is often embedded into comprehensive strategy or efficiency initiatives

New CIO / COO

Reorganization of Business / IT

New Business or IT Strategy

Window

of Opportunity

M&A Divestiture

Cost Cutting Initiative

Evolved standard software

? 2016 Deloitte Consulting GmbH

3

APR Focus and Roadmap

The strategic context determines the focus of APR and the journey to achieve its objectives

APR Focus

? Enable adoption of emerging technologies and service delivery concepts

? Increase flexibility, agility, and risk adversity

? Meet / align with business needs ? Meet strategic IT objectives ? Make room for innovation ? Increase flexibility, agility, and

risk adversity

? 2016 Deloitte Consulting GmbH

short-term

Retire low value applications

Centralize scattered functionality

APR Roadmap

medium-term

Standardize to common platforms

and versions

Modernize high value but aging

applications

long-term

Transform towards SOA

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APR Approach 1/2

Deloitte applies a 4-step approach based on a quantitative method to evaluate application value

1

As-Is Analysis

? Application Inventory

? Calculation of current TCO

Target

4

Picture

3

Solution Design

2 Evaluation

? Application Score Card

? Retirement Business Case

? Cluster applications (4R Framework)

? Cost Benefit Analysis

? Develop Target Architecture

? Calculate future TCO

? 2016 Deloitte Consulting GmbH

5

APR Approach 2/2

Based on their Business and IT fitness, the applications are mapped to the 4R-Framework

IT Fitness

? Functionality & Architecture

? Maintainability ? IT-Security & Risks ? Reliability ? Scalability ? Infrastructure

? Strategic Value

Business Fitness

? Functional Fit & Ergonomics

? Compliance ? Financials

? Risks

? Quality

? 2016 Deloitte Consulting GmbH

4R-Framework

High

Rationalize

Retain

#2 #13 #12 #10

#15

#11

#8 #9 #4

IT-Condition

#7

#3

#1

#6

#5

#14

Low Low

Retire

Re-platform

Business-Value

Application cost

#n Application ID

High

APR Roadmap

6

? 2016 Deloitte Consulting GmbH

Opportunities? Next Steps?

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