From Clutter to Clarity: Streamlining Operations with Application Portfolio Rationalization


In today’s complex IT landscape, application portfolio rationalization is essential for businesses to stay competitive and efficient. However, reports indicate that a staggering 70% of organizations lack proper documentation regarding their current application portfolio, leading to reduced productivity, increased costs, and security risks.

Application rationalization can help organizations address these challenges by providing a clear understanding of their application portfolio and identifying opportunities for optimization. By following the key steps outlined in this blog, organizations can achieve successful application portfolio rationalization and drive their business toward long-term success.

Steps to Achieve Seamless Application Portfolio Rationalization

  1. Define objectives and scope: The first step is to establish clear objectives and scope for the rationalization initiative. This includes identifying specific goals that the organization wants to achieve, such as reducing costs, improving efficiency, or increasing agility. Also, define the scope of the initiative in this step, such as which applications will be assessed.
  2. Conduct an inventory assessment: Next, conduct a comprehensive inventory assessment of your organization’s application portfolio. Gather pertinent information about each application, including its purpose, functionality, costs, and usage. Moreover, assess associated risks related to security, compliance, and any technical concerns.
  3. Prioritize applications: Following the inventory assessment, prioritize applications based on their business importance, cost, and risk profile. This prioritization will help guide the rationalization efforts effectively.
  4. Develop a roadmap: With prioritization in place, develop a roadmap for rationalization. The roadmap should outline the necessary steps to retire, replace, repurpose, or consolidate each application, ensuring a structured approach to the process.
  5. Execute initiatives: Execute the initiatives outlined in the roadmap. Collaborate with vendors to retire or replace applications as needed. You may also need to reorganize or consolidate applications within your organization.
  6. Monitor and optimize: Finally, continuous monitoring and optimization are crucial for successful application portfolio rationalization. Keep track of the benefits realized from the initiative and adjust as required.

Tips for Successful Application Portfolio Rationalization

  • Get executive buy-in: Application portfolio rationalization is a complex and time-consuming process, so it is important to get executive buy-in from the start. This will empower the initiative with the resources and support it needs to be successful.
  • Involve key stakeholders: In addition to executive buy-in, it is also important to involve key stakeholders in the application portfolio rationalization process. This includes business users, IT staff, and other stakeholders who will be affected by the rationalization initiative.
  • Use a systematic approach: A systematic approach involving using a well-defined stepwise process is essential for achieving successful application portfolio rationalization.
  • Be flexible: The enterprise application portfolio is constantly changing making it important to be flexible and adaptable in the application portfolio rationalization process. This means being willing to amend the roadmap or prioritization of applications as needed.
  • Measure and track results: Measuring and tracking the results of the application portfolio rationalization initiative will ensure that it is achieving the desired results. This will also help to identify areas where the initiative can be improved.

Benefits of Application Portfolio Rationalization

Application portfolio rationalization can be transformative for businesses. A Gartner study indicates that application rationalization can be transformative for businesses. CIOs can reallocate resources for strategic initiatives, enhancing agility, and customer satisfaction while saving 15%-25% of their application budget. Thus, in today’s digital age, application portfolio rationalization plays a pivotal role in driving business success. By setting clear objectives, conducting thorough assessments, prioritizing applications, and creating a structured roadmap, businesses can unlock their true potential and maximize returns on technology investments. Embrace the power of application rationalization with NSEIT’s strategic and personalized Application Portfolio Rationalization assessment and streamline your business, paving the way for future growth and innovation.
Get started with our Application Portfolio Rationalization Assessment today!
Authored by
Vasudev Vittal Kini
Assistant Vice President – Enterprise Architect
NSEIT Limited
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