What is application portfolio management?

APM places a business’ entire software stack under a microscope, providing a detailed picture of every application and bringing them in line with the big-picture strategy for the enterprise. As such, application portfolio management empowers organisations to:

Perhaps the most prominent and potentially valuable advantage, the ability to counter the dangers posed by defunct apps, is central to APM. When applications reach the end of their life, they can begin to represent serious risks and vulnerabilities. Application portfolio management helps organisations create effective end-of-life plans for their apps, so that these potential security and process weaknesses don’t become liabilities at some point in the future.

Large and even small enterprises may find they have thousands of different software applications throughout their infrastructure. Application portfolio management maps the applications to the business capability, easily identifying those applications that are no longer useful or support the business. Additionally, app indicators may be applied to measure all-around performance. Using these indicators, APM quickly identifies and categorises every application, allowing organisations to eliminate redundant technologies, replace obsolete tools, and ensure that every piece of software is bringing in real value.

Every business application has one key function: to support the company. And although application portfolio management is effective at providing a ground-level view of applications and dependencies, it also excels at collecting essential data for large-scale IT transformation. As application landscapes evolve and change to support new strategic initiatives, APM provides reliable, real-time reporting to help leaders and decision-makers better understand the impact of IT investments. Additionally, application portfolio management extends across the entire application portfolio, giving decision-makers insights to align every current piece of software to the big-picture needs of the business.

Application portfolio management categorises and evaluates applications based on total cost of ownership, along with other relevant factors. This gives decision-makers a clear view of the actual value of each piece of software, so that they can make informed choices and maximise returns on every IT investment that draws from the budgets.

Another advantage of app categorisation and evaluation in application portfolio management is that it allows businesses to more easily understand what needs to be done, and identify and prioritise their technology stack. Application portfolio management provides insight into which applications are nearing their end of life, and be able to plan with other company initiatives and priorities.

Gaps, redundancies and obsolete technologies can slow important business processes to a crawl. Application portfolio management uncovers these hidden bottlenecks and then takes things a step further by outlining feasible improvements designed to help processes reach top efficiency.

Bringing all applications and tools together in one place, teams and departments across the entire organisation get to work with a single source of truth with regards to application functionality and investments. This allows for better communication between stakeholders and prevents resources from being applied to unnecessary IT purchases (and resource support of applications that serve no purpose).

When correctly implemented, application portfolio management can become a reliable foundation for business transformation, informing smarter investments, maximising their impacts and promoting ongoing innovation. Here are several best practices to help businesses see the greatest potential returns from APM solutions:

Application portfolio management exists to help leaders and other stakeholders make better decisions on which applications provide the most value to the business. By understanding the needs of the current users, which applications they need to do their job, APM can help match business capabilities to company strategy. APM must be capable of working closely with executives, project managers, app architects and other technology-planning roles to provide them with software to do their jobs, support the business strategy and answer their questions.

Data collection and maintenance in application portfolio management isn’t a one-team job. Suppliers from other teams and departments will need to regularly contribute data, beyond their traditionally defined responsibilities. To ensure that they have the direction and inspiration they need to fill the position of APM data supplier, organisations should first select a group of ‘pilot’ data suppliers to train on important processes and best practices. Feedback from these early adopters can then be used to refine the training process for other data suppliers. However, this is not always a manual process—IT discovery and IT asset management (ITAM) can automatically collect relevant data.

Application portfolio management success does not necessarily mean completely revolutionising entire app portfolios. Instead, success often comes more quietly.

With effective application portfolio management, organisations can have a clear understanding of what applications are in their environment and how to reduce costs by eliminating those that don’t align to the business strategy. Funds can be used to support those applications that help accelerate the business in its growth. Stakeholders and leaders can effectively use the data in APM to align applications to business functions and work together towards a common roadmap on strategy. Sharing this success throughout the organisation can help stakeholders at all levels recognise the value of APM.