Senior Writer: Urmi Shah
If you want to run an application efficiently, do you update each application separately? Wouldn’t it be better if a business process allowed you to manage all your applications in one location?
Something that would keep your applications up-to-date with operating systems, browsers, plugins, and other enhancements so you can focus on business priorities. You certainly need a way to monitor all this day in and day out. And we are here to discuss the solution – Application Portfolio Management!
What Is Application Portfolio Management?
Application portfolio management is a set of processes and tools to help organizations manage their applications. The term “applications portfolio” refers to all company or department applications. Applications portfolio might include products like CRM systems, ERP systems, and custom-built web apps.
In a gist – Application portfolio management (APM) manages a collection of business applications as a single entity, which can help create a more streamlined enterprise. Application portfolio management involves the ongoing review, analysis, and selection of software to best meet the needs of an organization. What is an application management process
APM is often used in conjunction with application management or software asset management. The goal is to develop an efficient and effective application environment that supports business requirements while minimizing risk, cost, and other factors such as licensing fees.
Why Is Application Portfolio Management Critical?
As organizations become more agile and move away from traditional waterfall project management, they need to know what applications and how they are used. Application portfolio management helps you do that. It allows you to track your software licenses, see who’s using what applications for what purpose, and ensure that your company isn’t paying for redundant or unnecessary permits.
Application portfolio management is also critical because it allows you to ensure that your company can easily upgrade its software without worrying about whether it will work with the other applications it uses.
By using Application Portfolio Management, organizations can:
1. What Is Application Portfolio Management?
With app portfolio management in one place, organizations can gain visibility into their entire application portfolio. This allows them to understand what they have, where they are currently spending money, and how they can reduce costs while improving business outcomes. Through this process, they can also identify low-value applications and eliminate them from the portfolio.
2. Application rationalization, IT costs reduction, and IT agility
App portfolio management helps to rationalize the application portfolio by eliminating low-value applications or unused licenses and consolidating similar applications into fewer environments.
This improves efficiency and reduces IT software costs, and enables faster development cycles for new applications which result in increased agility for the organization’s business operations. It also provides a mechanism for managing the risk of technology obsolescence by ensuring that all software remains current with vendor updates and patches so that it is supported over its full lifecycle without any gaps between releases or patches being missed.
3. Technology obsolescence, risk reduction and standardization
Technology obsolescence risk reduction and standardization. IT departments spend a significant amount of time dealing with outdated software systems. App portfolio management provides visibility into the software portfolio, allowing organizations to plan for upgrades and replacements.
4. Improved IT transformation roadmap
As companies move toward a more agile approach to IT development, they need a way to manage complex projects that include multiple applications and teams. App portfolio management can help identify what needs to be done and when it must be completed.
5. Facilitates outsourcing of IT operations, IT audits, and compliance
App portfolio management tools provide transparency into how applications are functioning so they can be managed more effectively by third parties. This allows organizations to outsource their IT operations without putting their businesses at risk from poor performance or security breaches due to a lack of visibility into how applications are being used within their environments.
Approaches to Application Portfolio Management
When managing your application portfolio, you must understand that there are two approaches you can take: the top-down approach and the bottom-up approach.
Top-down: In this approach, you start with the essential applications in your portfolio and work your way down until you’ve covered everything in your portfolio. The benefit of this approach is that it’s easy to follow, but it can be time-consuming if you have many applications in your portfolio.
Bottom-up: With this method, you start at the bottom—the most miniature applications in your portfolio—and work your way up to cover all of them. This method is quicker than the top-down method but requires more effort because each application must be analyzed separately before moving on to the next one.
What Is Application Portfolio Management Lifecycle?
Applications are complex systems that affect multiple organizational functions. Managing multiple business functions efficiently requires a holistic approach to managing applications. This holistic approach extends beyond just software development lifecycles and includes infrastructure, security, change management, integration, maintenance, and support processes.
Here’s how each phase of the application portfolio management lifecycle contributes to better performance monitoring and optimization of your applications
- Planning phase: This includes establishing clear goals and objectives, defining KPIs and metrics, developing a strategy, identifying risks and opportunities, specifying roles and responsibilities, creating a budget and time frame, evaluating options, and selecting the right toolsets.
- Implementation phase: In this phase, the selected solution is deployed in a pilot environment to ensure it meets expectations. The answer is then rolled out across all relevant departments in the organization. Finally, the project team monitors performance and makes adjustments as necessary until the system is optimized for maximum performance.
- Operations phase: In this phase, IT staff members manage ongoing operations while ensuring that they’re aligned with strategic goals set out by senior management. This includes monitoring performance KPIs to ensure that systems are running optimally. They also conduct periodic audits to ensure compliance with regulatory requirements such as GDPR or HIPAA.
- Evaluation & Feedback: Understanding how well your APM solution is performing and providing feedback on how it can be improved to meet your needs better.
- Retirement & Disposal: Decommissioning an existing APM solution when it is no longer needed or no longer meets your needs
In other words, the APM lifecycle is a process that begins with the planning phase and ends with the disposal phase. As you move through each stage, there are opportunities to evaluate and improve your APM solution to meet your business requirements more effectively.
Best Practices for Portfolio Management Applications
As the application portfolio manager, you will manage the application portfolio and ensure that your organization’s applications are aligned with business strategy. The following Application portfolio management best practices can help you do this successfully:
Get To Know Your Internal Customers
Determine what questions your customers are asking, and then determine how you can help them answer those questions.
Ask your customers what they’re trying to do and why. What are their goals? How will they know if the project is successful? Who else will be involved in the project? What resources do they have access to? What obstacles might prevent them from achieving those goals?
Once you’ve identified these questions, you can start thinking about how to help them.
The target output list contains the most critical metrics and business goals used to evaluate the health of the application portfolio. Therefore, the target output list should be kept up-to-date by adding new metrics as they become relevant, removing old metrics that are no longer relevant, and adding new ones as they become essential. This ensures that all stakeholders can easily understand what they’re trying to accomplish with each application in the portfolio.
Define Your Terms
Defining your terms is one of the most critical steps in application portfolio management. What does it mean to “manage” an application? What does it mean to “improve”? How do we measure these things? Before you start gathering data from your various applications, make sure everyone involved understands what these terms mean and how they’ll be measured. This will help ensure everyone is on the same page when deciding which applications should be cut or improved and which ones should receive additional funding or resources.
Load Data in Distinct Phases
When you begin a new APM project, it is essential to have the correct data available. Therefore, the first step is to acquire the data in a valid format and at the right time. For example, if your APM system requires data from your network devices to be provided in a certain way, it must be available when your APM system needs it. The best practice here is to load your data in distinct phases as opposed to trying to load all of your historical data at once. This will help you avoid having an incomplete or corrupt dataset.
Conduct “Pilot” Training for Data Suppliers
Data providers are often reluctant to share their precious information with others, especially when unsure how their data will be used. If possible, try conducting pilot training sessions with some of your potential suppliers before making any commitments or signing any contracts. The goal of these sessions should be two-fold: First, they should help build trust between you and your potential suppliers; Second, they should allow you to demonstrate the value of sharing information with others so that both parties can see how this arrangement benefits them both.
Develop a Communication Plan
To better align your organization’s applications and technology with its business strategy, you need to have a communications plan that includes regular meetings with key organizational stakeholders. These meetings should consist of business unit leaders, IT staff, end users, and others directly involved with the IT department’s products or services.
Broadcast Your Success
You can help create a culture of continuous improvement by sharing successes within your organization. You should also share lessons learned from projects or other initiatives within your company so that others can benefit from these experiences.
Best Application Portfolio Management Tools
Alt-text: Portfolio Management Application – MProfit
MProfit is easy-to-use portfolio management & share accounting software. M Profit is a preferred choice for the investment community across investors, traders, family offices, financial advisors, and chartered accountants. Data can be easily imported from shared digital contract notes, mutual fund statements, bank statements, and F&O contract notes.
- Easy to use
- Client-centric approach
- Cannot directly accept reports and statements
Pricing: Available on request
Alt-text: Portfolio Management Application – Invest Plus
InvestPlus is a financial portfolio management application that helps you manage all your accounting, investments, and income tax-related requirements. It has modules like Personal Accounting, Assets Management, Loan Management, Investment Management, Income Tax Preparation, and Personal Organizers.
- Extensive features
- Excellent customer support
- Limited accessibility
Pricing: Available on request
The Quantis platform provides functionality that supports all aspects of Investment Management Operations: surveillance, risk management, investment management, and reporting. Quantis enables users to create, manage and monitor their portfolios across multiple currencies and markets. The platform also provides a complete set of reporting tools to support regulatory reporting requirements and detailed analytics regarding portfolio performance against critical benchmarks or peer groups over time.
Quantis is used by leading asset managers and financial institutions worldwide who want to improve their trading operations while simultaneously reducing costs associated with manual tasks such as trade processing, reconciliations, and netting processes through automation provided by Quantis’ powerful technology platform.
- Easy to use
- Real-time updates
- Great support
- Offers Limited capabilities
Pricing: Available on request
Portfolio Vista view gives complete Portfolio Management solutions for all kinds of investors. It has an inbuilt algorithm that provides triggers for order generation, Receivables/payables fees computation and can be used for both Discretionary and Non-Discretionary portfolios.
- It’s a great way to see your entire portfolio simultaneously.
- You can set it up to automatically rebalance your portfolio over time.
- Makes it easy to track your performance over time.
- Not suitable for active trading—you can’t buy and sell based on market movements or the news like you would with a brokerage account.
You have a list of some of the most popular application portfolio management software. But as you can see, there are certainly some differences between them in terms of features, price, and target audience.
So if your business is not achieving ROI on its processes, our suggestion is to take a portfolio management approach that is repeatable, transparent, and scalable. The data and insight derived from adopting a model like this will encourage businesses to pursue a more comprehensive product portfolio, supporting innovation within their industry and improving ROI.
Frequently Asked Questions
APM enables companies to:
- Eliminate duplicate licenses by tracking license usage and assigning rights based on actual utilization.
- Streamline license purchasing by being able to negotiate better pricing with vendors.
- Reduce costs by eliminating unused applications and eliminating unnecessary licenses.
- Improve productivity by ensuring that employees have access only to the applications they need.
- Monitor compliance by ensuring that all applications are used per company policies and regulations.
The first step to getting started with application portfolio management is to determine your current situation. For example, do you have applications running in the cloud or on-premises? Are you already using a third-party vendor to manage your application portfolio? What are the costs associated with each of these options? Once you've gathered this information, it's time to start thinking about how APM will improve your organization's ability to deliver business value.
An application portfolio is a group of applications used to accomplish a specific business goal. The applications in an application portfolio are often linked together or dependent on each other. For example, you may have an accounting application to process invoices and payments. You also have a customer relationship management (CRM) application that keeps track of your customers’ contact information and history. The accounting system needs to pull data from the CRM system to charge customers correctly and track their invoices. In this example, the two applications are linked to accomplishing a specific business goal: processing invoices and payments.
Application portfolio analysis is a process that enables you to assess your applications, understand their value, and prioritize them based on the impact they have on your organization. The application portfolio analysis aims to determine whether the applications in your environment are adding value or simply taking up space.
Key metrics can be used to measure the effectiveness of an application portfolio management program:
- Application Technical Performance: This metric measures an application's stability, performance, and reliability. It can also include user experience and satisfaction metrics, security, and industry standards compliance.
- Application-Business Accord: This metric measures how well an application aligns with business goals and objectives. If it doesn't align with those goals, it's not providing value for the business—and therefore isn't worth keeping around.
- Application Cost-Business Value: This metric measures how much money a company saves by using an application over other alternatives combined.
Vendor security risk management is a strategy or process that ensures that any malfunction or setback at the vendor's end does not negatively impact your business's operations, reputation, data security, or performance.