Most organizations looking to take advantage of emerging technologies for business innovation and transformation don't have the luxury of being able to work in a greenfield environment. Instead, there is the necessity to continue maximizing value from existing IT investments and integrating new solutions into this environment. With increased convergence between operational technology and information systems, given further impetus by technologies including IoT and 5G, it is vital that modernization plans are set in the context of business objectives. For example, evaluating the running costs of an application in isolation from the business capabilities that it supports, or of its potential in transformation initiatives, could potentially lead to suboptimal decisions on its future roadmap.
Many organizations will be assessing their application portfolio as part of a digital transformation initiative or a cloud migration strategy, but too often these decisions are being made primarily on technical criteria, rather than discerning what will add most value to the business. Enterprises should therefore take the opportunity to undertake a full review of their application portfolio as part of these broader transformative programs. This view should not be restricted solely to major application assets but should also encompass the departmental and ad hoc solutions that are often left lurking in the shadows.
Key steps are to build an accurate application inventory, capturing as much metadata as possible on both the technology itself, its running costs, and its business usage. This foundation then enables a meaningful assessment of the portfolio, identifying areas of overlap, duplication, and redundancy, and highlighting areas for potential savings where costs are relatively high and there is scope for an alternative approach to support the relevant business processes.
IT departments often find it challenging to justify and communicate the value of application modernization and maintenance, so there are distinct benefits in viewing these projects as part of broader business renewal and transformation programs. Industry examples of this process include the migration to on-demand operations in the broadcast sector, the renewal of core banking platforms in financial services, and the deployment of smart grids and smart metering in energy and utilities. It is also vital to include these components in the business case for new projects – taking a whole lifecycle view of the costs involved, rather than simply the short-term cost of development and delivery.
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