What is Application Portfolio Management?

If you don’t know where you are, you may never get to where you want to be.  Through adopting the discipline of Application Portfolio Management (APM), organizations have found savings of up to 30% of their IT budget.

Application Portfolio Management (APM) is the discipline that enables informed decision making for IT.  By enabling the ranking of applications by composite measurements, APM provides factual information that enables the CIO to guide investment to the applications delivering greatest business value, and the justification for addressing the most costly elements of the IT portfolio. APM takes the risk out of change.

APM provides this insight through the collection of information from all relevant sources, including application code, rate of change, operational costs, problem reports and business value as described by line of business owners.  This information provides the basis for business decision making – a fundamental requirement of APM. Armed with this understanding, the CIO can:

• Justify what to outsource – and monitor the effectiveness of the outsourcer
  
• Rationalize the IT portfolio – know what to keep and what to retire
  
• Determine a coherent modernization strategy – based on key value, cost and complexity metrics
  
• Control costs and quality – mapping areas consuming the majority of maintenance effort to their value, resolving bottlenecks

Imagine grading core systems by the benefit they bring to the business, then overlaying this with their cost.  This knowledge is the power APM brings.