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• Number of users: One of the simplest ways to analyze existing applications is to identify which have the most users and which have the least users. Applications with the most users are usually worth analyzing in depth because
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anything that can be done to improve these applications is likely to have a dramatic impact on the portfolio. Applications with only a few users represent interesting targets for retirement, replacement by function from a more popular application, or application outsourcing to another party that may have a better economy of scale in this type of application (e.g., regulatory compliance applications that only one or two people actually use).
• User satisfaction: Applications that users are most frustrated with make a good target for replacement or major upgrades. An interesting way to corroborate finding from user surveys is to cross-reference results with help desk statistics on the number of trouble tickets associated with an application and application maintenance statistics on the number of change requests. It is often possible to create a compelling argument for addressing the root problem in the application simply based on savings in reduced help desk calls and application change requests.
Business process outsourcing impact is a much more sophisticated analysis that focuses on the impacts of outsourcing part of the business. Most companies spend little time analyzing the overall IT—and particularly application—impacts of outsourcing a part of the business (e.g., moving from internal distribution centers to a third-party logistics provider). If applications can be sorted by user group, this quickly creates an impact list of applications associated with outsourcing a particular user group:
• Technical condition: An applications technical condition can be viewed from the perspectives of strategic alignment with architectural principles and standards, operational condition, and overall technical condition.
• Strategic alignment with architectural principles and standards: Strategic alignment focuses on whether the application and its underlying components comply with the key principles and standards outlined in the enterprise solution architecture and enterprise technical architecture. In many cases, an application will comply with standards at a point in time. However, as a company’s architecture evolves, the application can fall out of compliance, driving the need to upgrade or replace it. This reinforces the need to regularly update application attributes and conduct key analyses.
• Operational condition: Tactically focused, which often includes statistics gathered from the help desk or systems management software. These statistics often form the basis for particularly compelling arguments for application change. Indicators of an application’s operational condition include the number of maintenance/service requests, average time to complete a service change, number of help desk trouble tickets, availability, and response time.
Applications with the highest numbers of service requests, trouble tickets, availability issues, and response time problems are all candidates for further analysis and
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investment. Sophisticated companies look across these attributes, identifying applications that have issues in multiple areas, and use this as the basis for a compelling argument to change the application.
Once an application’s business value and technical condition have been determined, a higher-level portfolio analysis can be conducted as shown in Exhibit 4.22. Leading organizations periodically look at classes of applications and plot them based on their business value and technical condition:
• Applications ending up in the lower left quadrant have low business value and are in poor technical condition. They are candidates for retirement, consolidation, or replacement.
• Applications in the lower right quadrant have high business value but are in poor technical condition. They are candidates for reengineering and modernization.
• Applications in the upper left quadrant are in excellent technical condition but have low business value. They are candidates for reevaluation and repositioning.
EXHIBIT 4.2 2 VIEW OF TECHNICAL QUALITY AND BUSINESS VALUE for applications
Year 4 ...
Maintain/ Evolve Asset
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• Applications in the upper right quadrant have high business value and are in excellent technical condition. Counter to conventional wisdom, these applications are still worth worrying about. They must be carefully maintained and evolved; otherwise, they will end up in the lower left quadrant over time.