Application portfolio assessment is a process used by organizations to evaluate the software applications they currently use. The main goal of this assessment is to identify which applications are most beneficial to the organization and align with its business goals and objectives.
By conducting this assessment, organizations can make informed decisions about which applications to invest in, retire, or replace in order to optimize their overall application portfolio and improve their operations.
Application inventory assessments are an essential component of the application portfolio management discipline. Efficient and complete assessments are performed using APM (Application Portfolio Management) tools such as the LeanIX EAM.
APM tools provide businesses with a standardized process and visual maps, increasing the quality of assessments over time and more straightforward rationalization.
📚 Related: Assess Application Criticality Levels
There are several reasons why organizations may conduct an application portfolio assessment. These reasons include:
Overall, the main goal of application portfolio assessment is to ensure that the organization's application portfolio is well-aligned with its business goals and is optimized to support its operations and growth.
There are several use cases when any organization – large or small – will assess its application portfolio.
Cloud computing is a huge part of modern enterprises. Third-party services like Google, Microsoft Azure, Salesforce, and IBM enable IT processes and services to be accessed online.
The process of migrating to cloud services will require an assessment of the current application portfolio. This is to establish which SaaS, IaaS or PaaS services will best achieve the goals of the business and their impact.
When two businesses merge, redundant software or duplicate applications can become part of the newly formed IT landscape. As a result, analysis and rationalization of the new application portfolio must be carried out as part of a successful integration process.
IT optimization is the process of continuously analyzing an organization’s business technology processes and applications to discover cost-saving opportunities. These areas include cloud services, infrastructure, and applications amongst others.
Large enterprises tend to have complex IT infrastructure which can become burdensome and expensive to the business over time. Software complexity reduction allows enterprises to streamline and rationalize their application portfolio.
Technology moves at lightning speed; especially in the IT world. There are always new updates, versions, and applications organizations need to adapt to stay competitive. By assessing application inventory, old software can be retired.
Application portfolio assessments help businesses discover possible risks in their IT landscape. Risks can include security gaps, running redundant software, and shadow IT.
To perform a successful application portfolio assessment, a few basic requirements need to be established before the process can begin.
The more detailed information IT teams have about the following, the better the decisions that can be made. Main Application portfolio analysis strategy must-haves are:
Once the use case has been created, the next step is to establish which application portfolio assessment methodology will be used. There are three main frameworks enterprise architects can use to approach the task; these are Gartner’s APA, TIME model, and 6Rs.
These methodologies go hand-in-hand with each other but create different outcomes. Which one you should use will depend on the use case and desired target architecture.
The Gartner TIME model is a way to identify, manage and prioritize opportunities for portfolio improvement using business and technology fitness, risk, and cost. It is a way to modernize large and/or outdated application portfolios, as well as implement cloud migration and application modernization software.
TIME is an acronym for Tolerate, Invest, Migrate and Eliminate. Attributes of the model include:
The 6Rs methodology for application portfolio assessments is a framework for determining which applications can move to the cloud, and how.
Cloud migration provides many technical and financial benefits for businesses. 6Rs (Rehost, Replatform, Repurchase, Refactor, Retire, Retain) assess applications for cloud readiness.
Garter’s Application Portfolio Analysis (APA) is a tool that divides a business's current and proposed applications into three categories — utility, enhancement, and frontier. Each of these categories is based on the degree to which they contribute to the enterprise’s performance.
This framework organizes applications based on performance, so is best used by businesses that want to gain optimal performance and value.
Gartner's APA categories are:
Application portfolio assessments provide the groundwork for many use cases and are necessary for any application portfolio management project. Which methodology you'll use depends on the use case and experience.
To succeed, use APM software which provides IT experts with a visual overview of the application landscape; their business capabilities, components, costs, and potential risks.
Assessments are an essential component of managing the IT landscape toward the organization’s target architecture.
Building an application inventory begins with asking the right questions to obtain the right data.
What is application portfolio analysis?
What should be included in an application portfolio?