Application Rationalization: 5 Common Mistakes

Posted by Neil Sheppard on June 12, 2023
Application Rationalization: 5 Common Mistakes

Application rationalization can be challenging without an established process. Let's consider the five most-common rationalization mistakes and how enterprise architects building their process can avoid them.

Application rationalization was one of the topics we asked our customers about in our recent IT Cost Optimization Survey. We found that only 15% engage in application rationalization on a regular basis.

READ: Application Rationalization Key To 2023 IT Cost Optimization

Yet, with global economic turmoil on the horizon, many organizations are now looking to optimize their application portfolio. With little experience of regular application rationalization, many of them are likely to discover the pitfalls and risks.

Let's cover the five common mistakes made in planning an application rationalization effort and how you can best avoid them.

Application Rationalization Mistake 1: No Goal

The two primary reasons that you will engage in application rationalization are to optimize:

  1. costs
  2. performance

Determining which of these is your priority will be vital in making decisions.

What if all your team are using an expensive application that's slightly better than a cheaper alternative? Whether you keep the current application or downgrade to a less-expensive option will depend entirely on whether you're trying to optimize cost or performance.

Of course, most often you'll be looking to optimize both at the same time. In that case, performance and cost targets will help you find the right balance and trade off in the right places.

Either way, knowing your end goal is key to making difficult decisions about application rationalization. Without a goal, you're likely to end up running around in circles struggling to find alignment.

To ensure everyone is working to the same targets and to enable change management, your metrics should be published to all stakeholders. It will also be useful to be able to refer back to those targets at a later time to understand why previous decisions were made.

Application Rationalization Mistake 2: No Roadmap

Once you have your goal, you can start building your target state. If you're looking to cut costs by 20%, you can plan out an application portfolio that is 20% cheaper, and so on.

From there, mapping out the steps you need to take to move from your current to your target state may be complex, but it should be obvious what you need to do. Mapping this out will then give you a project plan.

Sharing this roadmap with your organization provides clarity to all stakeholders on what the project entails, what it will cost, and what the benefits will be. It will also serve to co-ordinate your team and stakeholders to keep the project on track.

The best way to make your roadmap available to all is to publish it in a fixed location that everyone in your organization can access. It's also worth doing this in advance of the project to gather feedback and manage objections.

Teams often find going about an application rationalization in this way far easier and it makes the whole process much more positive for everyone. Working without a roadmap, you're working in the dark.

Application Rationalization Mistake 3: No Timeline

Understanding your roadmap will empower any application rationalization process. Yet, without a deadline by which the steps need to be completed, they will invariably be stuck as backlog tasks for a rainy day.

To ensure progress is made, each step needs to have a realistic timeline for completion. That way, a responsible person is allocated to each step of the rationalization by a set time.

You may not hit every deadline you plan out at the start, and this is to be expected. Without a set timeline in place, however, you're unlikely to get far.

Once again, publishing that timeline to stakeholders will serve to keep everyone accountable and updated. That's why having a roadmap with timescales is so vital.

Application Rationalization Mistake 4: No Buy-In

Even with your roadmap in place, you will still need to get buy-in and alignment from the various stakeholders. Application rationalization can often involve thousands of different applications, so this can get very complex, very quickly.

We've all created old-fashioned RACI matrices in the past and this is essential for application rationalization. Before decisions are made in an application rationalization process, you need to work out for each app who is:

  • Responsible - carrying out the work
  • Accountable - bearing the success or failure
  • Consulted - contributing expertise
  • Informed - being told what's happening

Yet, with application owners coming from various different departments across your organization, they will need support. Provide guidance for them and a list of criteria by which they can make their decisions.

This should include the:

  • project metrics and goals
  • recommendation for the application in question
  • rationale for the decision
  • drawbacks to not approving the decision
  • criteria by which they can make the decision
  • budget and timescales
  • support you'll be providing for outages and staff retraining

This guidance needs to be user-friendly, simple, and also be available to everyone in your organization for transparency. Storing your RACI information and the list of criteria in a publicly accessible place is key to ensuring clarity and transparency.

With a clear and public listing of who has the decision on each application and what criteria they're using to make the choice, it's much easier to align your stakeholders and ensure there are no surprises.

Application Rationalization Mistake 5: No Data

Let's look back on each of the solutions to our mistakes so far:

  • Clear goals
  • A roadmap
  • Timescales
  • Logged ownership for each application

There's one thing each of these four items cannot exist without: data.

  • You can't know your goals if you don't understand your current state
  • You can't build your roadmap if you don't know your metrics
  • You can't create a realistic timescale if you don't know what you're doing and how long it will take
  • You can't know who owns each application without understanding who uses which application to do what

Data empowers decision-making and planning, which are the two keys to application rationalization. Therefore, data is the most important element to application rationalization.

You may have noticed that part of the solution for each mistake is to make data available to all stakeholders by collating it in a single source of truth. That's why an enterprise architecture management (EAM) platform is so important for application rationalization.

The Solution: The LeanIX EAM

Using the LeanIX Enterprise Architecture Management (EAM) platform empowers you with detailed, customizable Fact Sheets for each of your applications. Using automated surveys and data gathering, you can track all the data on each of your applications, including ownership and RACI information.

Using this data, you can create a complete overview of your application portfolio. You can even build the roadmap to your target state and test several scenarios for change against your metrics, including timescales.

With the LeanIX EAM powering your transformation, you can not only avoid application rationalization mistakes, but create a cycle of continuous app rationalization to ensure your portfolio is always optimized with minimum effort.

To find out more about how the LeanIX EAM support application rationalization, see our solution page:

USE CASE: Application Rationalization

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