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Identifying portfolio gaps (e.g., skill shortages and overages, retention risks, etc.).
Identifying gap-closing scenarios (e.g., training, hiring, outtasking/outsourcing, etc.).
Creating a strategic resource management competency that focuses on the processes and skill sets of engaging internal and external resources.
Assessing, monitoring, measuring, and reassessing actual versus projected performance, evaluating metrics and benchmarking data, and making changes to the framework as required. This may also include feeding important lessons learned and knowledge captured back into the system.
Leading-practice companies apply human capital management practices across the entire value chain and maintain the ability to staff up or staff down with internal or external resources for on-cycle and off-cycle needs. These companies understand that talent management is a critical differentiator. Attributes of these companies include:
Higher retention rates and the ability to attract talent from top universities and leading companies
A culture and organizational structure that embraces change, constantly empowering, challenging, and rewarding employees for attaining desired behaviors
Reduced hierarchies and bureaucracies
Development of a learning organization mentality
156 CHAPTER 4 IT PORTFOLIOS AND THEIR CONTENT IN CONTEXT
Creation and sustainment of excellent relationships with employees and external entities
Stellar communication, knowledge management, collaboration processes, and tools to change directions at a moments notice
According to research, companies with highly mature human capital management processes have 50%+ greater commitment, productivity, and loyalty from their employees. Of extreme importance, however, is working through the human capital portfolio with the human resources department and possibly the legal department. Some information that is desirable to collect may not be lawful to collect. Some organizations benefit from diversity programs focusing actively on ensuring a balanced mix of such attributes as gender and ethnicity. Often, however, tracking this type of information is not lawful. While the potential benefits of an optimized human capital portfolio are enormous, careful attention must be paid to organization change management.
Applications are the fulcrum of the IT asset portfolio (e.g., processes are automated and aggregated on applications). Research indicates that as many as 40% of existing applications can be retired in some way, and another 40% can benefit from reengineering, restructuring, or replacement. Exhibit 4.19 provides the definitions and elements of an application.
Accurately assessing the value/business benefit and total cost of ownership for an application is one of the more difficult challenges of the application portfolio as seen in Exhibit 4.20. The key to effective application portfolio management is to keep the overall goals in mind while continually questioning whether gathering information about a particular application attribute will enable a useful analysis. The long-term challenge is to perform this exercise regularly to keep information and analysis up-to-date with a high degree of automation. The overall goals include:
Providing the basis for a consistent set of application-related discussions
Communicating the status of the existing application set (including targets for decommissioning or sun-setting)
Highlighting and aligning which applications support the business strategy and vision (and associated cost burden) and which applications are likely to constrain the business in the future
Uncovering major issues associated with applications
*The authors would like to thank Val Sribar, Elizabeth Roche, and Willie Appel of META Group for their stellar contributions to this section.
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APPLICATION DEFINITION AND APPLICATION ELEMENTS
What Is an application?
An application is:
An aggregation of software code impounding business logic and rules
Transforming users or system input into data output
For the purpose of automating and optimizing business functions, processes, tasks, and activities therein
But it could also be:
A view of business processes at a point in time
In the eye of the beholder
Todays view of an application finds that one persons application is another persons:
Function Application origin:
Custom built: any software application (in-house of bespoken or custom developed) built specifically to user requirements
Configured: any commercial software package that has been upgraded or configured specifically to user
Commercial: any commercial software package that has been installed with only infrastructure configuration Application types: