EA and Application Portfolio Management


For many enterprise architects there is increasing pressure from CxO’s to cut costs, reduce inefficiencies and to foster agility in systems. Enterprises invest over 70% of their budgets purely on maintaining their existing asset investments. This shows that there is a clear and present broken link between strategic business objectives and “Keeping the Lights On” in the IT department. This is verified by a recent report by AMR Research that reports that 75 percent of IT organizations have little oversight over their project portfolios and employ non-repeatable, chaotic planning processes.

With an Application Portfolio Management (APM) practice it allows EA’s to gain visibility into the applications impacts that reside in the enterprise.

Forester says that Application portfolio management (APM) dashboards provide visibility and the ability to cut applications maintenance support costs by as much as 30%. See the July 22, 2005, Market Overview “APM Tools Will Reach $500 Million To $700 Million By 2008.”


What is APM?

There are many definitions across the industry. There are debates on the definition of APM that frequently cause confusion or derail APM initiatives. There is no a single definition of APM, but is that a problem?

In the near tem I don’t think so. Until our tooling vendors mature a bit more we have time to define it as little or as much as we want. So my recommendation is to be pragmatic about it. just like with everything EA, start small and iterate through some maturity cycle. APM views can then be progressively refined, ultimately arriving at catalogs of the various representations that can be mapped and or analyzed for the multiple areas of concern.

Below are a few opinions on definitions, at the end of the day. You be the judge for what fit’s your organizational needs.

Microsoft: Application Portfolio Management aids organizations gain visibility, insight, and control across all work; thus enhancing decision-making, improving alignment with business strategy, maximizing resource utilization, as well as measuring and increasing operational efficiency.

IBM: This refers to the practice of managing an entire group or major subset of software applications within a portfolio. Organizations regard these applications as investments because they require development (or acquisition) costs and incur continuing maintenance costs. Also, organizations must constantly make financial decisions about new and existing software applications, including whether to invest in modifying them, whether to buy additional applications, and when to "sell" — that is, retire — an obsolete software application.

Gartner: Application portfolio management processes fill gaps in the knowledge used to determine the most-effective deployment of IT resources. Filling those gaps improves consistency and flags opportunities to reduce total life cycle cost.

Wikipedia: Application Portfolio Management attempts to use the lessons of financial portfolio management to justify and measure the financial benefits of each application in comparison to the costs of the application’s maintenance and operations.


So What are the Synergies between Enterprise Architecture and APM

To be effective at enterprise architecture APM is absolutely necessary. Some may not realize they are performing APM functions for one reason or another. However, to support necessary EA functions APM information is collected in either a formal COTS tool or a custom solution. While it is difficult to capture there are many ways to get this information.

APM provides many of the multi-faceted aspects that are required for an Enterprise Architect to be effective. These include:

· Application Costs

· Supporting Business Process and Capabilities

· Business Objectives or Missions

· Supporting Technology

· Environments



These aspects above only show EA’s a partial view just from an application perspective. The view point of an EA is much broader. So to augment this application view other views are blended. EA’s should extend the well defined APM information with Enterprise Architecture Metadata where the Application Architecture can be linked to other aspects. Once this is in place multiple viewed analysis of an application provides enormous value not only the EA but other IT decision makers.

As shown above APM feeds into the three core aspects of an EA’s role. APM’s providing a backbone to the rest of the EA processes (i.e., Organizational, Strategic, Programs).

Below are some examples of processes APM contributes to:

· Technology Life Cycles (TLC) – The process in which a life cycle is attached to an asset. The asset could be an application and or a technology standard.

· Principles and Policies – Aligning applications to principles and policies is fundamental activity for EA’s. If the principles and policies are aligned with the business this provides the full tractability back to the business.

· Standards Alignment – By linking applications to standards EA can not only gauge the overall effectiveness of a standard but also analyze why standards are not being adopted. Thus providing a level of governance and proactively to impact the standards list in a positive way.

· Architecture Decisions – Because all of the applications are in this APM repository EA’s are able to bridge APM information with other information that will allow them to make informed decisions.

· Architecture Review Boards (ARB) – It is common to have EA’s on an ARB. APM provides essential PPM and application data that provides visibility across multiple domains.




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