November 15, 2007
App Portfolio Management: Get IT in the boardroom
By Birket Foster
It’s not just about the 3000. Like a facilities manager, an IT manager has many kinds of budgets to consider. A new strategy, one that treats applications like they are corporate assets, can deliver valuable benefits to help a company using HP 3000s move forward.
IT people have been notoriously bad at getting their place at the boardroom table. An IT budget needs to follow the business direction. The Application Portfolio Management (APM) strategy ensures a good business fit for all of a company’s programs.
Studies show that managers spend 80 percent of the IT budget maintaining their current assets. If you are forced to do anything radical you run into real issues, then overrun your budget. At most companies, the IT budget is set at operating level.
Migration can be a radical step. But the duty of an IT manager who oversees a 3000 is to keep track of what is productive. It’s not about the migration, it’s about the whole portfolio. You must assess the 3000’s risk versus the rest of the applications in the portfolio.
At M. B. Foster, our team has been doing migrations for the past five years. We actually started with data migrations in 1985 — but once HP announced its phasing out of the HP 3000, we began working on the methodology for migrating applications as well.
Our typical discovery process is to look at a company’s business, both today and where it is going. We then evaluate the viability of each application in supporting the business going forward. Many customers have applications on different platforms and in different stages of supportability and business fit.
What do we mean by business fit? It is how well the application supports the needs of the business. We ask each department using an application to explain how they use the system and what is missing. Is there a formal wish list for application changes? In a typical situation there may be two years of backlog needed on the application.
The issue is that 80 percent of the IT budget which you must spend on maintaining the current apps. That leaves only 20 percent for innovation — not enough budget for major projects. Windows and desktop application support often takes the majority of the maintenance money, so there’s little left over to apply to application servers like the HP 3000 and applications that run the business. Just as any facilities department must budget for work beyond day to day, so should an IT department be prepared when a major renovation needs to take place.
APM helps managers assess value to application assets. To begin, take an inventory of applications and clearly understand the current business and technology fit for each application. Publish the application portfolio so it can become a budget item visible to the management team. I know, at first it may not be where you would like it to be, but it is what it is — there is nothing that can be done about the past. But when you start the process of APM, you can start managing a budget with the objective of aligning business needs with IT’s, with options for The Three Rs of Applications – remain, replace, or rehost. This way IT can get included at the management table and get the budget needed to renovate when required.
A business fit gets determined from things such as management needs vs. what they get for management reporting and measurement of goals. Consider how the operational users interact with the system and how easy the system is to use; how well documented the system is; how new users at all levels get trained on the system. Assess how easy is it to adapt the system to new business requirements, and how well it supports the different departmental workflows.
Getting on the agenda
A whole new way of looking at IT is to look at what innovation can be done to improve the company and then calculate the ROI – which in this case means “Return On Innovation.”
Once the portfolio is assessed, you can make plans for individual applications. The plan will include a work breakdown structure that details the tasks to be done, the people to do the tasks, and the timeframe and resources required.
This step will help with getting budget approval and communicate the involvement from each department. The APM strategy solves a business problem, not an IT problem, and you will need a team effort to get IT on track so it can be managed as an investment. Getting an application portfolio organized will help your planning and risk mitigation. Ignoring applications for too long will create a crisis, and a much bigger investment will be required.
Birket Foster is CEO of M. B. Foster, a software company offering cross-platform data access and delivery solutions in the HP , Unix, Linux and Windows markets. Contact him at 800-ANSWERS, ext. 204 or email him at Birket@MBFoster.com.
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