How to use ServiceNow APM and Bizzdesign to win at Digital Transformation Latest news from (my website): Bizzdesign

ServiceNow APM and Bizzdesign customers can benefit from the complementary strengths of both platforms. How? Integrate future state design and roadmapping with centralized management of your business application portfolio and current state operational data through productized data mapping between ServiceNow’s Common Service Data Model (CSDM) and ArchiMate. By doing this, you can design strategic technology roadmaps to drive digital transformation, IT estate modernization and cloud transformation for your enterprise.

How to take advantage of ServiceNow APM and Bizzdesign

Gain control of your current-state application portfolio with ServiceNow APM through a centralized application inventory, robust data management workflows, and dynamic application indicators to support decision-making around application modernization and cloud migration initiatives to reduce cost and lower risk. Then, leverage the unparalleled modeling and visualization capabilities of Bizzdesign to design future (target and transition) states.

3 Key Benefits of leveraging ServiceNow APM and Bizzdesign

1. Holistic view of current and future technology portfolio landscape

ServiceNow enables you to manage all your IT assets and work in one place, connecting plan, build and run with a 360-view based on a single source of truth for IT.

Bizzdesign provides traceability from strategy to execution, connecting the dots across business and IT, providing decision support for digital transformation and strategic technology roadmaps.

ALSO READ: Get more insight on Enterprise Architecture Management

2. Use cases beyond Application Portfolio Management

With ServiceNow serving as a single source of truth to get all IT information under governance and management and Bizzdesign providing fast and simple modeling and visualization of all architecture information, the combination of the two platforms supports countless use cases, such as Capability Based Planning, Application Portfolio Management, Enterprise Architecture Management, Solution Architecture Management, Security Architecture Management, Risk and Compliance Management, and many more.

3. Seamless collaboration

ServiceNow APM and Bizzdesign enable all transformation stakeholders to collaborate seamlessly on the data sets they’re working on.

Our productized integration and pre-configured ServiceNow CSDM and ArchiMate mapping means you have full control over your data to ensure all stakeholders see only the information they require for designing future states, such as target and transition states.

Conclusion

Some enterprise architecture software lacks the capability to design and model target and transition states incorporating reference architectures, taking a more current state-focused portfolio management approach. These tools may also lack full application portfolio visibility including critical up-to-date operational and performance metrics, needed for informed decision-making on optimizing the application landscape.

To overcome these limitations, organizations can rationalize their tools by using ServiceNow APM, complemented by Bizzdesign’s Horizzon enterprise architecture platform.

Such an approach enables comprehensive and structured application portfolio management, incorporating target state design, strategic roadmaps, and architecture governance, combined with Bizzdesign’s powerful and flexible visualization capability.  Together, these platforms help ensure success in digital transformation initiatives.

About the author:

Nick Reed

Chief Strategy Officer at Bizzdesign

Nick is responsible for value proposition development, building strategic partnerships, and driving innovation topics, including executing Bizzdesign’s ‘buy & build’ acquisition strategy. He has over 25 years of experience in B2B enterprise software and SaaS, dedicating 15 years to enterprise architecture and portfolio management.

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APM Software: What CIOs need for Application Rationalization with Actionable Insights Latest news from (my website): Bizzdesign

When talking to customers and prospects, I hear great ambitions for digitization. But I also hear about pains when they describe their IT landscape. Customers have often grown a complex IT landscape and lack transparency about their costs, or functional redundancy occurs, especially after mergers and acquisitions. Information about their IT landscape sometimes resides in cluttered, disconnected and different silos, which makes it hard to get control over the IT portfolio. This is where APM software for Application Rationalization comes into play.

But why is Application Rationalization beneficial? Reducing costs is a prominent driver for rationalization or application portfolio management in general. However, reducing costs is not the only driver. In this blog post, I share top business drivers for application rationalization and how Bizzdesign supports your rationalization initiative.

Quick Links:

Blog – APM Software – The Real Benefit 
Blog – How Applications Portfolio Management Supports Cloud Transformations 

CIOs’ top 4 business drivers for getting APM software

Executives are under pressure to perform. Three generic levers for performance are money, market, and exposure. Executives strive to increase revenue and profit, market share and retention of clients, employees, and partners. In turn, they also want to decrease costs, time to market and various risks, including legal, technical or reputational.

The main drivers for application rationalization are:

1. Optimization of costs 
   The most obvious and often noticed driver for application rationalization is cost reduction. To have 100% control over the portfolio, leaders need to know the total cost of ownership (TCO) of individual applications and the entire portfolio. The question is: Is this required in detail for all the applications at all times?I agree with the statement of the ‘Application Rationalization Playbook’ of the CIO Council: “The precise cost of ownership is less important than the approximation of that cost with the added context of the application’s business value and technical fit all relative to the agency’s mission and business priorities.”Ranges or t-shirt sizes help to identify the candidates for rationalization and to get transparency. Of course, more exact cost details are needed for ROI calculations for decision-making. Deciding on the level of detail regarding costs is also a decision based on balancing effort and outcome. You’ll need to adjust the information at the right moment to act fast.
2. Minimization of risks – A million-dollar race 
   According to an IBM report, the average cost of a data breach in 2022 reached USD 4.35 million, sometimes even $9.44 million. Decision-makers don’t want to face these costs, but when a data breach occurs, action needs to be taken quickly. Resolving a data breach in 200 or fewer days saves $1.12M on average, according to the same IBM report (mentioned above).Once a data breach has occurred, transparency about your IT landscape is key. There are different risks, such as on the operational side, to ensure that IT services are available to employees, partners and clients to maintain business continuity. Especially knowing which applications run on outdated software helps to secure your application landscape. It even supports predicting needed investments to keep the security lights on green. So, considering the risk perspective is very important and justifies an ongoing application rationalization. 
3. Increase business and technical value to accelerate strategy
   We’re living in a time of rapid and disruptive technological innovations. Having an outdated or no strategy leads you in the wrong direction. Understanding and eliminating outdated technologies reduces risks and makes your portfolio better suited to meet current and expected future expectations.Another perspective to consider is the business value of your application portfolio. Involving the business and assigning them the responsibility of assessing the portfolio’s business value ensures that you, as an IT leader, understand how much they ‘trust’ their applications to bring them to the desired future.Aligning investments with change initiatives allows you to validate whether you invest in applications with high business and technical value. If not, it’s advisable to reallocate your investment and rationalization decisions toward applications that align with your organization’s envisioned goals. 
   
4. Reduce functional redundancy after mergers and acquisitions
   Although Mergers & Acquisitions slowed down in 2022, global M&A still reached $3.6 trillion in value, according to Morrison & Foerster. Private equity firms are particularly interested in AI, fintech, healthcare, and consumer companies. IT leaders must address the increased functional redundancy of their application landscape after an M&A. Reducing functional redundancy is critical for reducing the number of applications users need to manage and to decrease IT costs. Another essential aspect of exponential effects is complexity. By reducing functional redundancy, IT leaders can also decrease the IT portfolio’s overall complexity, which helps slow the speed of change and adoption of new technologies.

Call to CIOs

Invest in application portfolio management software and apply best practices: 

Act fast with the right level of detail at the right time 

Get decision support for portfolio councils 

Future state design for full-traceability: From strategy to implementation 

Design future transformations  

Bizzdesign’s approach to application rationalization

Bizzdesign understands the requirements of the enterprise from the boardroom’s perspective. Our APM+ solution goes beyond traditional application inventory tools and provides actionable insights to help IT leaders make informed decisions.

With APM+, we provide best practices for assessing the application landscape with the right level of detail, including (e.g. costs in t-shirt sizes to identify rationalization candidates and TCO when making decisions). Future state design and roadmapping with APM+ enables full traceability and impact analysis from strategy to realization so that IT leaders can see the outcomes of their investment decisions.

Next steps

• Read how one of Bizzdesign’s customers reduced their IT costs by 24% with application rationalization
• Watch a replay of our webinar to see how we support application rationalization initiatives

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How APM Software Supports Cloud Transformations Latest news from (my website): Bizzdesign

Today organizations have enterprise-wide strategies for cloud with different use cases of cloud transformation – there’s a shift from cloud-lift to multi-cloud and the scoping of cloud solutions. According to analyst firm Gartner, Inc, “By 2027, more than 50% of enterprises will use industry cloud platforms to accelerate their business initiatives.” During these times of change, enterprise architects must ask: “Am I equipped to guide and design ongoing cloud transformation?” Application portfolio management software usually provides the answer.

Enterprise architects can use application portfolio management to support cloud transformations to enable faster time to value of modern business applications.  However, companies often have application portfolio management software that focuses on capturing the inventory. They also use different tools to visualize the IT landscape and dashboards. But you’ll need more functionality than inventory management if you want to design cloud transformations.

Software requirements for architecting cloud

To design cloud transformations, you’ll need application portfolio management software that supports future state design and roadmapping. You’ll need to trace the impact of change decisions – from strategy to implementation. Enterprise architects requiring a better platform to support application management must consider this.

Showing how change impacts the IT landscape using a single source of truth IT repository improves the decision-making process. Besides decision support, a single source IT repository saves time when generating a project-start architecture. A single source IT repository eliminates the need to host workshops to collect and harmonize various MicrosoftÒ PowerPoint and Visio drawings.

Additionally, today’s enterprise architects are viewed as trusted advisors to senior management. Choosing the right software will help you to gain recognition. The software you choose must allow you to capture and map IT assets and identify and assess change candidates. You’ll also need functionality to design future state architecture to provide decision-support on transformations to C-level management.

The software you choose also needs to support collaboration and connect key experts in application transformation, for example:

• A technical repository steward sets up integrations via Microsoft Excel as a quick start or with OpenAPI technology to connect to IT asset libraries
• Subject matter experts, such as application owners, add information about the status of applications, including changes required to map and enrich data
• The enterprise architect or transformation team identifies candidates for change and assesses the approach taken. For example, the 6Rs of cloud migration is a strategy widely followed as best practices in cloud transformation
• Finally, enterprise architects design future architecture states and roadmapping to provide a solid base for making decisions on cloud and other transformations

Holistic Applications Portfolio Management Software in Action 

Application Impact

Application Impact
 

From Strategy to Implementation

Application Migration Roadmap 

Next steps:

Check out our newly launched out-of-the-box APM+ (Application Portfolio Management Plus) solution if you’re looking for software that ticks all the boxes. APM+ is built on our collaborative change platform, Bizzdesign Horizzon. Our solution covers all the phases of application portfolio management with full transparency of your current application estate and it supports analyses for future application transformations.

DOWNLOAD: APM+: Why future state enterprise architecture design is a key differentiator

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APM Software: The Real Benefit. Providing Functionality for Future State Architecture Design. Latest news from (my website): Bizzdesign

APM software is vital in today’s economic climate. CIOs are under continuous pressure to transform the IT landscape to respond to technologies disrupting existing business and operating models, regulatory requirements and other global drivers such as the United Nation’s Sustainable Development Goals. IT portfolio managers and architects give them the insights they need to make investment decisions by implementing the application portfolio management discipline.

Application portfolio management isn’t a once-off project but a continuous process of assessing portfolios. This discipline evaluates portfolios against criteria necessary for the organization to decide how to transform the application landscape.

Use cases for application portfolio management

Organizations’ rationale for using applications portfolio management may differ depending on their situation. Scenarios may include that organizations look at cloud transformation of legacy applications or implement cloud-native (industry) platforms. These organizations may want to provide a more secure, resilient and efficient IT foundation to enable faster time-to-value or to address the United Nation’s Sustainable Developmental Goals, like reducing carbon emissions.

Following Mergers & Acquisitions, organizations usually face a landscape with functional redundancies with different degrees of complexity. This needs to be addressed to raise business and technical value and reduce risks and costs over time.

Cost optimization is another typical reason for implementing application portfolio management. Organizations may want to increase the shift from Capex to Opex and reduce spending on ‘commodity’ applications to reduce costs or to free up investments in business innovation. Innovation and modernization are required to improve security and digitize businesses, attract young talent and benefit from current and future innovations such as AI.

The rationale may also be as simple as organizations wanting to start or refresh their applications portfolio management discipline to get transparency and a single source of truth.

Applications portfolio transformation toward the future

Regardless of your reasons for application portfolio management, the software you buy must meet different stakeholders’ needs – now and in the future. Most of the application portfolio management software on the market today helps you to establish an application inventory. Still, it includes limited functionality for multi-dimensional analysis and future state architecture designs and scenarios.

Future state enterprise architecture describes where the organization wants to be and provides a roadmap for the transformation. Designing future architecture is especially important to address an organization’s application portfolio management discipline effectively.

However, the reality today is that architects use different sources, such as ServiceNow and Microsoft® PowerPoint or Visio, to describe future state. When they make changes to the architectural designs in these sources, it doesn’t reflect in the applications’ repository of the applications portfolio management software, and vice-versa.

This leads to cluttered information in different tools resulting in double work of finding and synchronizing information on applications and changes for stakeholders involved in the landscape change. Especially at the project start, you could easily waste time harmonizing different drawings before starting on common ground.

Choose the right software

It’s therefore important that when you investigate purchasing applications portfolio management software, it needs to provide functionality for future state architecture design. A transparent overview of your entire application landscape is essential, but you must also plan for the future.

The software you purchase needs to allow you to integrate with different data sources, assess the application landscape and design future state architecture to optimize decision-making based on facts. This must be done all in one platform with best practices architectural languages. It’s the only way to get full traceability from strategy to transformation design!

Designing future application transformations with Bizzdesign’s APM+ solution

READ: How to use ServiceNow APM and Bizzdesign to win at Digital Transformation

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A New Home for Horizzon Latest news from (my website): Bizzdesign

While we are navigating the “new normal”, we are trying to cope with things in the best possible way. As such, we continue to realize new product developments and improvements for our customers. In this release we have:

• A new design and homepage for HoriZZon.
• Improved management for users and groups.
• Improved management for packages and projects.
• Made it easier to keep up to date with the latest changes in a model package.

Introducing a new design and homepage for HoriZZon

We are proud to present a new design for HoriZZon. We have kept the good things and introduced new visual elements making it easier for users to find what they need and get their work done. Next to that we have created a brand-new homepage to ensure that every Horizzon user has the most relevant content at their fingertips. On the homepage, we offer 3 tabs:

• Favorites: a tab with all your favorite views.
• Popular: a tab with a combination of the most popular views from all the Sites you can access. Popularity is based on the amount of views and the time the view has been published.
• Last updated: a tab that contains a set of views that have been last updated.

In upcoming releases, we will be adding more functionality to our homepage. For instance, we’re considering open workflow tasks, model package with recent changes, last commit messages and Dashboards. But we would like to know what you think we should add first, so please cast your vote below.

Improved User and Group management

To make it easier to manage users and groups, we have made it possible to assign default roles for users provisioned with an identity provider. We have also made it easier to find users and groups with a specific role. In the search box you can now search for roles by just typing (e.g.) “role: designer”.

To improve user management with large user groups, we have implemented the possibility to assign group administration privileges to a user. When a user enjoys group administration privileges, he or she can perform administrative tasks for groups:

• Add users to the group.
• Remove users from the group.
• Change the name and description of the group (only if the group is ‘native’, i.e. not imported or provisioned).
• Add group administration permission to members.
• Remove group administration permission from members.

Improved Package and Project management

To provide more granular content management, we have implemented the possibility to delegate administrative tasks by granting a user manage permissions for Packages and Projects. A user with manage permissions for a model package or project can:

• Revoke other users’ invitations to the model package or project.
• Revoke group invitations to the model package or project.
• Remove other users’ claims for the model package or project.
• Grant manage permissions to other users who are directly invited to the model package or project and remove these permissions.

With these uplifted administration capabilities, we aim to make user, group and content management more efficient, effective and easier for our customers.

Keeping up to date

Keeping up to date with all the latest changes of a model package has never been easier. We now offer the option to process all new changes when opening a model package, which ensures that you’re always working with the latest changes. When you finish your work and close Enterprise Studio, we will notify you about uncommitted changes.

Check all the details about our new homepage on our support page. To keep up with all our new features, big and small, check out our release notes. Have ideas for more improvements we can make? Be sure to drop us a note!

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APIs – Managing Challenges with a Portfolio Management Approach Latest news from (my website): Bizzdesign

Application Programming Interfaces (APIs) have emerged in recent years as a key enabler of digital transformation and enterprise agility.

By defining and deploying APIs, senior IT leadership can increase the responsiveness and adaptability of IT systems – both legacy and modern – by linking applications and data faster and more effectively. This enables a de-coupling between Agile ways of working for systems of engagement – the “front end” applications used by end users, where user experience and responsiveness are vital – and the more highly governed working practices for “back end” systems of record that often still underpin core capabilities of the enterprise.

However, many IT leaders have struggled to deliver the benefits promised by the “API economy”. Instead, they encountered limited visibility and transparency of APIs across the organization, redundancy and duplication, increasing maintenance overhead and ultimately more costs, with the same barriers to rapid transformation that existed before. One of the primary causes for this is often a narrow/siloed, IT-focused approach to API programs.

We have found that taking a portfolio management approach can help address these challenges and enable the benefits of APIs to be delivered effectively. The key principles are analogous to the well-established portfolio management practices for projects (“PPM”) and applications (“APM”).

First, start with the business context, based on the business’s strategy and goals. This typically involves understanding which business capabilities are priorities for investment/improvement, and which customer journeys are the focus of transformation efforts.

Customer journeys provide a structured, customer-centric approach to designing and analyzing customer experience, which is necessarily a high priority for digital transformation. They also provide a means of identifying which business processes, IT services and applications are needed to support a superior end-to-end customer experience. This in turn informs which APIs are required to link together the supporting systems and data required for the customer journey (together with the associated advanced analytics) and provides real, tangible business value associated with those APIs.

By creating metrics that take these factors into account, the business value of (potential) APIs can be assessed in a transparent and objective way.

Second, APIs are not necessarily just about supporting the customer experience. In many cases, they are “technical enablers”, acting as a wrapper around legacy systems and enabling data services for business applications that contain business logic. The applications may then, in turn, provide higher level APIs and data services for systems of engagement.

From this perspective, technical value represents a more relevant metric. This measure can quantify the benefits of avoiding legacy technologies – where skills and resources are scarcer and more expensive, and where changes can be more complex and risky – and providing modern APIs (e.g. RESTful microservices) that are easier to consume by business applications and more adaptable to changing demand. Technical value may also include other quality aspects of APIs, such as capacity and other performance metrics.

Third, make sure that the portfolio of APIs is leading to a simpler, more adaptable IT landscape. One of the dangers of having autonomous teams building APIs and microservices is a complex proliferation of dependencies across a large network of connected APIs. Taking an architecture-guided approach to control this complexity, which allows light touch coordination across teams, avoids the pitfall of “API spaghetti” without requiring classical, monolithic, waterfall ways of working.

Perhaps the most important point to keep in mind, though, is that APIs are about data – providing data to applications in a reliable and performant way. So it’s critical to have a data architecture modeled, as part of the overall enterprise architecture, that enables data objects to be mapped to the APIs, applications and services that provide and consume them. This gives visibility into duplication of data services and APIs, enabling rationalization and optimization of the portfolio.

Modeling the data, API and application architecture not only supports business agility through faster transformation, but also supports governance, risk and compliance management by enabling these teams to quickly visualize the “footprint” of data in the enterprise landscape (e.g. for GDPR compliance reporting) and assess risks and impacts (e.g. for information security). Furthermore, this also underpins a full line of sight from the customer experience and business strategy, through processes and applications, to the data required to support them, enabling impact and dependency analysis for improved planning and execution.

In summary, the rise in APIs represents a significant opportunity for enterprises to accelerate their digital transformation efforts. However, it can be risky and costly if this is done in a siloed way, without business context and a clear understanding of technical benefits. By taking a portfolio approach, in which APIs are treated as first class citizens of the enterprise architecture, organizations can ensure they make the right planning decisions towards realizing the benefits of the API economy.

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Application Portfolio Management: The key to value-focused architecting Latest news from (my website): Bizzdesign

Introduction

Many organizations with large legacy application landscapes can no longer postpone a major overhaul of their IT. But how do you avoid creating tomorrow’s legacy today all over again? And how do you spend your IT budget in the most sensible way? Next to appropriate design and development practices (e.g. enterprise architecture, agile and DevOps, as we addressed in our previous blog) you need to manage your application portfolio as a whole, to decide where it is most important to invest.

Strong vs. weak Application Portfolio Management

Application Portfolio Management is a dynamic decision-making process in which a coordinated set of applications, projects, programs, or products is routinely monitored, analyzed and managed to maximize their effectiveness. Evaluation and prioritization of projects and activities associated with the inventory provide the opportunity to prioritize, accelerate, terminate, or “de-prioritize” portfolio components and to allocate or reallocate associated resources.

When organizations lack strong portfolio management, they are reluctant to terminate projects or exercise end-of-life retirement of applications or products. In addition, project “Go/No Go” criteria are ineffective or non-existent. Weak performing inventories are not evaluated or cut. Some projects take on a life of their own, while others are added with little consideration for resource requirements, management attention, or impact on other projects. Resources may be reallocated to the latest “urgent” project, without full consideration of the disruptive effect this may have on “important” efforts already in flight.

As a result, a true lack of focus sets in — resulting in far too many inventory items for the available resources to manage effectively. Backlogs of work start to accumulate, cycle times begin to increase, and processes that are in place become ineffective. Efforts become more reactive and quality suffers, resulting in increased failure rates. The most significant impact of weak portfolio management is the impact on strategic direction — projects that are not aligned with the business strategy or are strategically unimportant are competing for and consuming valuable resources that should be focused on more strategic efforts. Many organizations suffer from this “innovation squeeze”: all available resources and budgets are used to keep the lights on in the legacy landscape, squeezing out strategically important innovation.

There are several challenges to achieving strong portfolio management:

• Too many applications
• Lack of resources (subject matter experts are often assigned but may be pulled to support “more urgent” requests)
• Lack of clear priorities
• Growing backlog of application support projects
• Tendency to gather data that doesn’t actually provide useful information for decision-makers
• Insufficient criteria used for portfolio selection
• Lack of effective monitoring and management of the portfolio

What is Application Portfolio Management 

Generally speaking, Application Portfolio Management is the process of managing a collection of applications to make effective decisions on investment opportunities. Like an investment portfolio containing a collection of assets selected to support specific growth or income objectives, application portfolios should be managed to support the enterprise’s key business strategies and objectives effectively. In general, portfolio assets may include products and services, business capabilities and processes, software such as business applications, middleware, and databases, infrastructure such as servers, networks, desktops, and mobile devices, and finally, resources to support it all. In APM, we focus on software assets.

ALSO READ: Choose the right Enterprise Architecture tool for portfolio management

Unfortunately, many organizations approach Application Portfolio Management as just one-shot application rationalization, primarily focused on cost and short-term technical problems. This has some major issues. First, cleaning up your application landscape just once and then forgetting about it again will result in the same problems you have today reappearing in the near future. Instead, a lifecycle approach to the application landscape is needed. Regular monitoring and governance, including clearly defined business value criteria of the (technical and business) health of applications and assessing options for their future, is necessary to manage the entire application portfolio properly towards the business needs.

Application assessment Time Analysis

Furthermore, applications are often judged on a stand-alone basis, but the landscape as a whole is more important, considering dependencies between applications and with the business processes they support, and the complexity, risks and business value of application landscape as a whole. Simply replacing or switching off an application in isolation is usually not an option.

It is essential to know the business value of applications and how they support the business, its processes and capabilities. But how do you objectively determine this (i.e. not just by asking users)? To this end, you need to use enterprise architecture models across all architecture domains to show traceability to business processes, business capabilities, products/services, and business goals and strategy. This also includes showing use cases, value chains and workflows and how they are supported by the applications, their functionalities, and data objects, e.g. for a product or a customer. This helps in assessing applications in context instead of stand-alone and this may also improve the value of applications by uncovering new potential uses.

Moreover, different categories of applications are judged on different aspects. Innovative front-end applications need to meet different criteria than stable systems of record. Appropriate portfolios should be defined for such categories. You want to ensure a balanced distribution of investments, both within and across portfolios, and both for your assets and your projects and programs. It is important to choose criteria based on business objectives.

Typically, strong Application Portfolio Management relies on five key performance measures:

• Applications are aligned with business objectives
• The application portfolio comprises high-value components
• Resources and spending reflect the business strategy and priority
• Application projects and activities are completed in a timely manner and within budget
• The application portfolio comprises the right number of components

Portfolio Management in context

How to relate Application Portfolio Management to other disciplines

As outlined above, strong Application Portfolio Management critically depends on a clear line of sight with the business strategy and a strong foundation in enterprise architecture. One useful way to relate your application portfolios to the strategy is via business capabilities. Business capabilities define what an organization needs to be able to do, in order to achieve the outcomes that are described in the corporate strategy. They are the key building blocks of the business, unique and independent from each other, and tend to be stable over time. As such, they are a very useful foundation for structuring application portfolios and determining the strategic importance of the applications therein. This paves the way for true value-driven architecting.

Moreover, strong Application Portfolio Management needs to be part of the day-to-day processes that maintain and enhance your application landscape. Its value-based approach makes it well-suited for approaches such as the Scaled Agile Framework (SAFe), outlined in our previous blog post. Tying it in to the value streams at the portfolio level of SAFe and funding such streams based on (among others) Application Portfolio Management outcomes is relatively straightforward.

Conclusion

In summary, strong application portfolio management takes a lifecycle approach to the full application landscape, relates it to the business strategy and is founded upon a solid enterprise architecture practice. This may sound easy, but it is still a difficult discipline: switching off applications hurts, and rationalizing decision-making may not be in everyone’s interest. But by focusing on business outcomes, better decisions can be made and more business value attained something every organization strives for.

About the author:

Marc Lankhorst

Managing Consultant & Chief Technology Evangelist at Bizzdesign

Marc contributes to Bizzdesign’s vision, market development, consulting, and coaching on digital business design and enterprise architecture. He also spreads the word on the Open Group’s ArchiMate® standard for enterprise architecture modeling, of which he has been managing the development. His expertise and interests range from enterprise and IT architecture to business process management.

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Application Portfolio Management for Finance – Slaying the Dragon Latest news from (my website): Bizzdesign

In many organizations a mythical creature lays deep down in the catacombs, otherwise known as the server rooms. This dark monster has an obsessive-compulsive disorder. Normally these creatures are in search of gold. However, this kind doesn’t fancy gold, this one hoards applications!

Smaug: Hoard

How did it come to this? Well, over the years the financial sector has seen many mergers, acquisitions and joint ventures. Often, these joint forces still act like separate businesses but serve the same customers. These different business operations functioning under a single umbrella has allowed the application-hoarding dragon to creep in. Similar to the dragon Smaug in Tolkien’s “The Hobbit”, where the giant amount of gold attracts Smaug who then expels the dwarves from their home.

Application hoarding in the financial sector has more causes than just mergers and take-overs. It is not uncommon that the product lifecycle of financial services exceeds the lifecycle for applications. Take for example a pension fund, which provides its services over many decades. The challenge is to maintain such a service or product while replacing applications. Consequently, we see this huge jungle of monolithic application landscapes of “tepuis” (the table mountains of the South-American jungle) that act as separate (mini) ecosystems that are completely isolated from the rainforest below.

UP!: Tepuis

You do not want to integrate these tepuis with the rest of your business, right? No, in the ideal situation you want to get rid of these monstrous mountains that make your application landscape so hard to manage. In order to do this, you need to develop and execute an application strategy that rationalizes your legacy portfolio and at the same time prepares it for fast-emerging business requirements and new technologies.

Slaying The Dragon

One way to get a grip on your application landscape is to do a major one-time overhaul, thereby risking to attract the application hoarding dragon yet again. Another option is that you stop building your own applications and instead deploy a platform that enables modular applications to interact with each other. Simply buy the applications (or hire them as a service) and integrate them into the platform.

In practice, a combination of approaches is required, and a continuous process for maintaining the health of your application landscape needs to be implemented. In doing so, APM will help you decide which legacy applications you can eliminate (call it a good spring clean), which applications you have to keep but migrate to new technology, and which applications are a good investment to support your business strategy.

Why use APM?

So why use APM? First, you can make well-founded decisions based on value aspects, risks and costs. Visualized information enables clear communication and helps to align strategy with business operations and IT. An example is the bubble chart below, which shows the business value, technical value and cost of applications, and provides a lifecycle advice for each of them.

APM Time Analysis

Second, managing a large application landscape by grouping these applications in portfolios helps you to deal with the sometimes overwhelming number of assets to be managed. Different portfolios serve different goals and can be evaluated using different metrics. A common approach to this is Gartner’s Pace Layering, which groups applications in systems of record, systems of differentiation and systems of innovation, each with their own investment criteria, development processes and pace of change. By allocating budgets at the portfolio level, you can also avoid the common ‘innovation squeeze’, where maintaining the legacy landscape eats up all of budget and nothing is left for innovation.

This approach results in a less complex application landscape with improved IT fitness and agility and reduced operational costs. In the end you will be much more capable in managing change and transforming your business.

How to Succeed With APM – Keep The Dragons Away

Integration of APM with EA

A successful APM approach requires integration with Enterprise Architecture (EA). As EA considers all domains that make up the organization, it can be used to provide the necessary insights on all the relevant parts of the enterprise for effective application portfolio management. Applications depend on each other and cannot be managed in isolation. EA helps you uncover these dependencies and decide on a feasible roadmap for change.

Enterprise Studio (BES) supports both the visualization of different value aspects of applications and the design and analysis of your enterprise architecture. This combination enables portfolio managers and enterprise architects to create portfolios, value assessments and dashboards that provide decision makers with actionable information to move the organization in the right direction.

To learn more about APM you can download a free e-book below. If you are already familiar with APM, the e-book may still provide you with some interesting insights and best practices (for example BiZZdesign’s House of APM). So if you want to slay that nasty application-hoarding dragon in your organization, you better start developing an APM capability today and take control of your business transformation!

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Application Portfolio Management in Local Government Latest news from (my website): Bizzdesign

Although Application Portfolio Management (APM) isn’t the newest kid on the block, it has had a tremendous growth in popularity lately. Due to the economic crisis and market pressures in general, IT managers and architects are constantly pushed by their CxO’s to reduce inefficiencies, improve agility of the enterprise and cut costs. The complexity of these tasks leads to an increasing need for tools and structures to help them handle their application landscape. Since over 70% of most IT budgets goes to maintaining existing applications, it is clear that there is a need for oversight and insight into the use of these applications and their added value, to reduce costs and make room for innovation.

Enterprise Architecture (EA) helps to create a good overview of the interconnections of all different aspects of your enterprise. However, larger, more layered, or political organizations may find that although having an overview through architecture helps, it is still difficult to manage their applications on the right KPIs. This is where APM comes in. By managing applications in portfolios based on added value, usage, number of dependencies or other metrics, it is easier to make decisions regarding the purchase or phasing out of different applications.

Managing Application Portfolios in Government Organizations

Now, almost every enterprise with a considerable application landscape has these issues, but in government organizations we see a number of additional challenges. Especially in smaller governmental organizations (e.g. municipalities) there are extra issues regarding application landscape agility. First of all, given their broad spectrum of tasks, their application landscape has to cover a wide range of functionalities.

Secondly, the tasks of local governments increasingly require IT-supported cooperation with other organizations both inside and outside the government, and also across different domains; think, for example, of the relationships between the social, healthcare and education domains in youth services.

Often, the dedicated applications they use for each of these tasks have a lot of overlapping functionality, for instance to store citizen data in local databases or to connect to external systems. Substantial cost reductions are often possible, but removing such overlaps by ‘refactoring’ this landscape, for example by storing shared data in centralized core registries, is certainly no sinecure.

Moreover, application lifecycle management in government also has to deal with public procurement regulations. Rules on procurement often demand that software licenses must be re-procured every few years, to give competing providers a fair chance. But interdependencies between different applications may still result in an eternal lock-in. Take as a simple example your email client and server. If these critically depend on each other, you cannot simply replace your email server once its contract runs out unless you also replace the client. But if that client is part of a larger office software suite this may not be an option, forcing you to stay with your email client and hence with your server. Similar dependencies also arise in the ever larger software suites that providers for local government offer.

Last but not least, due to their relatively small size, the IT departments of local government organizations are often understaffed considering to the complexity they need to manage.

APM and EA to the Rescue

To escape from such a lock-in and to reduce costly overlaps in functionality, you need careful management of the lifecycles, procurement and dependencies of these different applications. Your average overburdened IT manager in a government organization needs simple and clear overviews and dashboards to manage his or her application portfolio and landscape, preferably in an integral manner. A combination of application portfolio management – to take care of application health and lifecycles – and enterprise architecture – to manage the dependencies – provides precisely that.

Dashboard examples from Enterprise Studio

With Enterprise Studio you get a grip on both. It helps with maintaining the architecture of your company, not only giving insight and grip on the interdependencies of the application landscape but also harnessing the information within the architecture to manage your portfolios swiftly and efficiently. After the (application) architecture is set up, metrics (KPIs) can be added to score the applications. Ranging from cost, satisfaction, added value to even procurement deadlines, whatever your criteria for APM is, you can start to distinguish the applications and place them into portfolios.

After adding metrics and their accompanying information Enterprise Studio helps you create easy-to-communicate dashboards, highlighting the essentials of your dilemmas. By adding multiple KPIs – or eliminating some, it becomes easier to distinguish different applications, making a coordinated approach easier throughout the business. The dashboards help to illustrate all the intelligence collected within the architecture, making it a living thing, helping in day-to-day decision making.

Conclusions

We see many government organizations struggle with the cost and complexity of their application landscapes. Organizational fragmentation combined with regulatory pressure adds to this complexity. Application portfolio management is a useful instrument to support lifecycle management and decision making in such an environment – ultimately making life easier to manage, simplifying decision-making and enhancing efficiency. With the help of Enterprise Studio, you can make your enterprise architecture come alive, supporting APM with useful and clear dashboards.

We would love to hear about your experiences with managing application landscapes. If you have any challenges you face with APM or EA, let us know by submitting them in the contact form below.

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Bizzdesign’s House of Application Portfolio Management Latest news from (my website): Bizzdesign

As we have described before, few organizations have a systematic and reliable way of translating a business strategy into action. This requires aligning various disciplines along the same desired business outcomes. This is at the core of BiZZdesign’s approach to business change.

As stated by Gartner (keynote ITXpo 2013): “In 2017, every company will be a digital company. Capabilities to change fast and remain agile will be imperative.”  Hence managing your IT landscape effectively and efficiently is a key part of your change capability, in which application portfolio management (APM) plays an important role.

Often, organizations deal with hundreds of applications, and each of these may in turn spawn a multitude of projects and other change initiatives. How do you then decide where you want to rationalize (Application Rationalization) and where you need to invest your IT budget? A structured overview is needed, by grouping these investments in categories: portfolios. There should be a balanced investment in the types of projects (e.g. long-term vs. short-term, high-risk/high-gain vs. low-risk/low-gain) and the categories of assets (e.g. stable back-office vs. innovative front-office applications). Decision making is facilitated by grouping these investments in portfolios according to these characteristics, e.g. ‘innovation’, ‘new product introduction’, ‘going concern’, or ‘retirement’. For example, this helps to avoid the ‘innovation squeeze’: an ever-growing maintenance budget that eats up other investments.

This way, senior management can decide on investment allocation across whole portfolios instead of looking at each individual investment. Authority for decision-making on priorities within each portfolio can then be delegated to a lower level in the organization. With APM you can make more informed and coherent investment decisions, improve alignment with strategic goals, and monitor the progress of changes.

APM requires a clear picture of the enterprise’s structure and development, from different viewpoints. Enterprise architecture (EA) provides this holistic view on all relevant parts of the enterprise and its development in the various stages of the transformation process. The combination of APM and EA offers actionable information: next to establishing the impact of a proposed change on the business and IT landscape, an organization can now quantify this impact and get an integral view across many changes at the same time.

House of APM

The figure above summarizes BiZZdesign’s view on application portfolio management, visualized in the shape of a house. Business outcomes are of course the ultimate goal; the ‘roof’ that needs to be carried. The strategy provides direction to APM; its objectives are directly derived from that. Financial and other data are used as inputs. The design of portfolios consists of their content, metrics to measure these against the objectives, and dashboards to present the outcomes in a user-friendly way. This supports various analyses and the business decisions that follow from those.

A solid enterprise architecture foundation for your portfolios ensures organization-wide coherence and a clear view of the various dependencies involved. Finally, the basis is formed by a strong capability for portfolio management, with the right processes, knowledgeable people with the requisite skills, and optimal tool support to ensure an efficient and effective operation.

The ‘house of APM’ summarizes the different elements, needed to perform APM in an effective way. Some important lessons:

• APM goes further than Application Rationalization; it is about making smart investment decisions.
• APM is not just about IT; it is all about business strategy, business decisions and business outcomes.
• APM is not just about tooling; it requires a strong capability including a process, people and skills.
• In today’s complex environment Enterprise Architecture is essential to provide the insight, needed to make the right decisions.

Good luck with APM in your organization!

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Application Portfolio Management for Beginners with SMART Latest news from (my website): Bizzdesign

Everybody is familiar with the SMART abbreviation. It stand for Specific, Measurable, Acceptable, Realistic and Time bounded. But this blog is not about that kind of SMART. In this blog I will discuss how to apply another type of SMART within the context of Enterprise portfolio management.

Enterprise portfolio management is a powerful approach with lots of value for different users within the enterprise such as senior management, IT & project portfolio managers, program managers and enterprise architects. Many exciting developments are in progress in this field of which one is application portfolio management (APM). APM is about categorizing and analyzing applications within your enterprise and deciding on recourse allocations within the applications roadmap. Such analyses are supported by powerful Enterprise Architecture (EA) software products such as BiZZdesign Enterprise Studio. However, you might be using other EA software products that do not support such features. Or you might be starting the EA discipline within your organization and therefore decided to use free and basic EA software products, or no EA software products at all (yet). I would say a very rational and good approach – think big and act small – also for your EA software products. Then how can you evaluate applications within your enterprise without state of the art EA software products? The answer is by using SMART.

SMART

SMART stands for the Simple Multi Attribute Rating Technique and can be used to rate the value of things based upon multiple attributes. For example, rating the value of a new passenger car when you need to buy one. Let’s say I want to buy a new car and value several attributes that my ideal car should have. Each attribute can be expressed by a specific value. For example the purchasing costs of my car will be expressed by a monetary value (€) while the fuel consumption of my car is expressed by a ratio (litres per 100 kilometres).

Suppose I’m interested in five passenger car models. In order to select the best option I need to compare all models based on single quantitative value. But how can I define one quantitative value based upon different attributes with different values (monetary vs. fuel consumption)? I cannot simply add the values of purchasing cost and fuel consumption rate because they’re expressed in different units of measurements. Therefore I have to normalize them first. Normalization means mapping the values of an attribute to a normalized scale such as the 5 point scale low to high rating. The following illustration shows the attributes for my ideal car and their normalized values.

Illustration: Normalization of attribute values

But what if I consider the value of one attribute more important than the other? In order to do so I have to weigh each attribute to indicate its importance in respect to the other attributes. For my ideal car the weights of attributes are illustrated below. As you can see, passenger space is the most important attribute followed by acquisition costs.

Illustration: Weights of attributes

As indicated below I calculated the single quantitative value for each of the 5 car models. You can see that car model A has the highest score. By using SMART I have quantified the values of attributes for each car model. Calculating these values in a total score allows me to decide objectively which car model best fits my needs.

Illustration: Weighted total scores

Applying SMART

Let’s apply SMART for application portfolio management. Many valuation criteria can be used for this. An often used analysis of applications is based upon business value and technical value. Both dimensions can be rated based upon several attributes. SMART can be used to rate those. In the following illustration the applications and the attributes of business value and technical value are highlighted.

Illustration: Business value and technical value attribute rating with SMART

After normalization, total scores for each application can be calculated. The total scores for business value and technical value can then be plotted in a bubble chart as highlighted below. Now we are ready to discuss the implications of our findings. Based upon our data visualization we can formulate relevant questions such as:

Why does the AFAS – accounting application have a high business value and low technical value? Is it technically outdated?
What are the reasons for a low business value for SAP BPC while its technical value is high? Is it not fully implemented yet?
How should we handle our applications within our technology roadmap based upon their business and technical values?

Illustration: Business and technical values bubble chart

Conclusions & Recommendations

• In this blog I have highlighted how SMART can be used for application portfolio management.
• SMART can also be used within a variety of other situations where weighted multi attribute rating is required. For example SMART can be used in combination with the balanced score card, a SWOT analysis and the calculations of performance indicators.
• SMART can be used to evaluate applications within your enterprise.
• SMART is technique that can be used when no dedicated EA software products are available.
• Any spreadsheet application can be used to apply SMART.

You can apply SMART for APM through the following steps (illustrated below).

Illustration: Steps for application of SMART

You might notice that applying SMART with your regular spreadsheet application works just fine as long as the number of the to be rated applications, their attributes and weights are limited. For an efficient way of valuing tens or even hundreds of Enterprise Applications, a dedicated EA software product is necessary.

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