Application Rationalization – is it rational?

One would certainly categorize predictably ill-fated ventures as irrational.  Why would a rational individual undertake an initiative that is almost guaranteed to fail?  Is application rationalization one of those initiatives?  Perhaps it is and that is the reason John McCarthy used the word “courage” to describe the emotional trait necessary to pursue its goals.

Recently, I spoke with Mike Vizard of IT Business Edge.  We discussed many compelling reasons why an organization would pursue application rationalization.  Cost reduction, increased business agility and business transformation were at the top of the list.  But, even with those stakes most organizations are reluctant to give it a try.  There are many reasons why, some legitimate, others not.

One of the most legitimate reasons is that some applications provide very specialized support for certain functions.  It would be unwise to eliminate them in a wholesale fashion.  That specialized support might be unique handling for a particular process in a given geography or with a specific partner.  Some products and services require their own individual processes.  And, during the course of post merger integration, applications should be phased out carefully.  Virtusa has found that these specialized functions are few and far between; certainly the minority in a large and unwieldy application profile.  In addition, if there is unique support for a specific function, there may be no reason to maintain the entire application system, rather harvest the most critical components.

Firms must take an aggressive stand against proliferation to find out which applications are critical.  I spoke to a CIO last month who told me that his company has over 100 applications that he doesn’t know what they do.  I asked him what he was going to do about it and he said “unplug them one by one until somebody complains, then plug that one back in.”  In 2008, Gartner analysts Jim Duggan, Valentin T. Sribar wrote “issue the application hunting license.”  Others advocate treating the application portfolio like your clothes closet – add one, throw out two – to prevent bloat.  Whatever the approach, IT optimization is not likely to be the result without an aggressive strategy.

Ann All, also of IT Business Edge, commented on Mike’s post.  She attacked the problem from the process point of view.  Her post asks “Is the CIO the right person to champion process improvement?”  The topic is also hotly debated on www.ebizq.net in the discussion thread “Who Should Lead a BPM Project?”.

The CIO is certainly a prime candidate.  In a project that requires support for a multi departmental, multi function process that intends to rationalize redundant applications the CIO may be the best choice, particularly if that project intends to leverage BPM technologies.  Also, the CIO is a typically a neutral party not favoring one specific group.  The CIO also has an in depth knowledge of the technical challenges involved and the general nature of the application portfolio in question.

Other candidates include an executive sponsor from one of the constituent departments or functions.  The downside to that individual is that they favor what they know best, the operations and requirements of their group.

The opposite is true of a neutral observer, an executive sponsor that is not involved in any way with the resulting system.  That person may not have an in depth understanding of any of the business issues or implications involved with the project.

In any case, a strong orientation to process and a strong leader are traits that are critical for success.  Process flow work is not easy and certainly not second nature to a vast majority of the general public.  There are more companies that are poor at process than there are companies that excel.  By its nature any project like this will be matrix managed putting a premium on leadership skills and persuasion.

Business technology optimization is a challenging and daunting task.  Creating more efficient processes can often be a catalyst in the pursuit of IT optimization.  Take the best and shortest route and make sure you have a partner that understands managed transformation.