In our last post, we explored the basics of Application Portfolio Management (or “APM”) and the key elements to building your organization’s application portfolio. So, it’s built – now what? In this post we’ll delve a bit deeper into some of the metrics that can be used to provide some insights and help with the decision-making process.
Metrics can provide information from a technical perspective or a business perspective and both types provide value. Gathering additional information such as financial data to complement your findings is part of the process and can vary from simple to complex depending on how accessible that data is. There are APM tools available that could help automate the process.
Subject to what you’ve decided to track in your portfolio, the possibilities for metrics are endless. What you choose to measure relies on what questions the organization wants answered. That being said, there are some key metrics that could provide some insight fairly quickly:
Costs per department: By documenting each application”s usage information, you should be able to identify the list of applications used by each department or business group and the related application costs per group. If you discover that the department with the highest application costs generates the least amount of revenue for the organization, that could be meaningful information depending on the organization’s structure and priorities.
Usage: As part of the inventory process, you may have discovered that some applications were no longer in use and could be retired, which could result in some cost savings opportunities. Alternatively, applications being used by the entire organization could be considered critical and may require particular attention and care.
Age of applications: Perhaps you discovered instances where older versions of an application were still in use. This is fairly common in any organization. It’s a good opportunity to determine if a newer version exists that could provide more value to the business and increase user productivity whether with improved functionality, additional features or useful bug fixes. Becoming familiar with the age of your applications gives you a head start in planning for future upgrade paths and the required time, effort, resources and costs associated with that. This is particularly important for your organization’s core applications such as ERP or CRM where user impact and change management are key considerations.
APM provides insight into what your organization needs to run from an application perspective. Identifying the proper metrics allows you to provide the necessary information to help answer any questions the organization has. In the next post we’ll take a closer look at why it’s important to know and manage your operational base.