Application Portfolio Management: Delivering Improved Functionality

White Paper

Application Portfolio Management:
Delivering Improved Functionality
to Drive Efficiency, Innovation, and
Growth White Paper | Copyright Lionbridge 2008
White Paper | Copyright Lionbridge 2008 | Page 1 | WP-528-0108-1 White Paper

At a Glance
APM is one of the best tools for evaluating, balancing, and enhancing the value of application portfolios and supporting fact-based decision making.
Executive Summary Globalization and the accelerating pace of change have created a mass of complex business, technology, and management requirements - resulting in an overwhelming mix of technologies and applications that must somehow be aligned with business and IT strategies and requirements. Profitability and growth pressures have also never been greater. Today's technology and application leaders are under pressure to deliver functionality that will drive efficiency, innovation, and growth, while keeping costs under control. In this dynamic environment, the management of technology and application portfolios has become a top business priority. Companies rely on a growing portfolio of applications to keep their business running. Financing, 1managing, and maintaining a portfolio of several hundred applications is not uncommon. Everything from email to critical business applications must be maintained, integrated, and updated on a regular basis. Accordingly, maintenance and operation costs consume about 80% of 2IT budgets - leaving only 20% for new project spending. To deliver improved functionality and align spending and effort with business criticality, business and IT leaders need a clear picture of the cost versus return for each application in their portfolio. Unfortunately, most companies are operating without maintenance and management tools, such as Application Portfolio Management (APM), that are designed to maximize performance and efficiency. A 2006 Forrester Research survey indicates that only 5% of 221 IT decision-makers 3surveyed had "full APM implementation[s]." Not having a clear view of application performance makes controlling costs and improving ROI difficult. APM is one of the best tools for evaluating, balancing, and enhancing the value of application portfolios and supporting fact-based decision making. Being able to recognize and reduce the amount of time and money spent maintaining non-essential applications can significantly free up budgets for IT innovation. This white paper provides a framework for implementing an APM program that will enable your organization to: . Monitor and analyze the impact of technology and application changes
1 Gartner Research, "Highlights From the Application Track at Symposium ITxpo," 26 October 2007. 2 Forrester Research, "CIOs: Attack Weak Application Maintenance Processes That Stifle IT Productivity," 12 February 2007. 3 IBID
White Paper | Copyright Lionbridge 2008 | Page 2 | WP-528-0108-1 . Align changing business and technology objectives . Reduce portfolio complexity and cost of ownership . Increase return on portfolio investment and performance
Definition of Portfolio Management Portfolio management is the process of managing investments and assets, and balancing risk and reward to achieve certain goals and outcomes. To support the delivery of expected returns, portfolios must be continuously managed and maintained. In the IT context, portfolio management is the process of managing the economic lifecycle of software, hardware and infrastructure, and divesting and investing in a mix of assets to optimize gains. In the application context, it is the process of managing application portfolio performance to achieve specified business goals and returns. Lionbridge defines application portfolio management (APM) as a: . Program - that enables the assessment of all applications in a portfolio, the evaluation of potential changes, and an understanding of the impact of these changes . Discipline - that enables managers to continuously manage and maintain an application portfolio . Framework and tool - that evaluates total cost of ownership, identifies performance redundancies and gaps, pinpoints trouble spots, and highlights opportunities for improvement
Benefits of APM APM offers an "all-in-one" approach to... [download for more]