Plan for Application Consolidation

Successful application consolidation relies on assessment of the application portfolio to determine the best candidates Info-Tech Research Group2 Consolidation projects are expensive, disruptive, and often fail. Start with a preliminary applications assessment to create recommendations for the right consolidation project that will avoid costly expenditures on an ill-fated project. This research is designed for IT leaders who: Have been or will be going through merger and acquisition activity. Are in global or distributed organizations that offer duplicate services from multiple centers. Are in organizations with “shadow IT” in the business, or a history of unmanaged software acquisition and deployment. This research will enable you to: Identify the software consolidation opportunities that will provide maximum business value to the organization. Quickly get to the answer “yes” for recommended consolidation initiatives. Improve the likelihood of software consolidation project success through a three-phase assessment approach.

Executive Summary For many organizations, consolidating duplicate or redundant software is an ideal way to cut costs and boost productivity. Consolidation seems straightforward: select among the best and simply turn off those that are redundant. Right? Wrong! Many consolidation projects are poorly planned, costly, and time consuming. They result in angry executives, unhappy users, and put IT in the hot seat. Systems remain in place to handle custom functionality that wasn’t considered, business units refuse to adopt the changes, or the new system won’t meet future business objectives. If you want to simplify the software portfolio and reduce costs, invest in upfront software inventory analysis for success. Develop consolidation recommendations that meet functionality requirements and ensure that the right projects are considered before embarking on the actual consolidation project. Info-Tech recommends a three-phase approach to plan your consolidation project: –Create an application inventory from the existing portfolio. –Assess the inventory for consolidation candidates. –Recommend consolidation projects that will reduce costs and boost productivity. Info-Tech Research Group3

Consolidation planning efforts are small in comparison to the long-term benefits of consolidating the right things Info-Tech Research Group4 You already know why you want to consolidate, here are the reasons you must make an investment in inventory assessment and planning first. Benefits of Effective Consolidation Planning Consolidated applications support business strategy Organization achieves cost savings, expense reduction, increased productivity or increased efficiency after consolidation All possible consolidation options have been considered Roles and processes have been adapted All business functions are supported IT architecture supports the new application portfolio A focused preliminary assessment pays off by avoiding investment in large consolidation projects that would otherwise fail. Info-Tech Insight

Application portfolio assessment is a high level focus of key criteria to determine ideal consolidation candidates 5Info-Tech Research Group The objective of the portfolio assessment is to save time and money by avoiding big investment in non-starter projects. Take an iterative approach to quickly establish an initial application roadmap and associated value case. Speed Make recommendations to focus first on high priority, high value opportunities. Focus Structure a flexible approach that can be adjusted as objectives and scope are refined. Flexibility

Use Info-Tech’s Software Consolidation Readiness Assessment to determine the company’s readiness for software consolidation Info-Tech Research Group6 Whether the goal is to address an entire application portfolio or specific applications, certain capabilities and support are required before a consolidation project should be attempted. Use this tool to determine what steps your organization needs to take to get ready for a consolidation project. Info-Tech Insight Use the Software Consolidation Readiness Assessment to assess organizational readiness for a software consolidation initiative based on a number of criteria.Software Consolidation Readiness Assessment 1.Define the current state of the organization. 2.Identify potential organizational risks. 3.Prioritize the need to address each risk factor. 4.Define mitigating actions to reduce risks and increase organizational readiness for the project. Info-Tech Tool

Identify Candidates Assess As-is Wrap Up Consolidation Approach Secure Approval Understand the approach to application assessment: Determine the right time to consolidate. Partner with the business. Manage the assessment like a project. Understand the need and how to approach software consolidation planning. 1

Recognize opportunities in the organization and begin your consolidation planning when they occur Info-Tech Research Group8 Organizational Events… Business Events: Mergers & Acquisitions –Multiple application portfolios brought together, creating overlapping business and application functions. Globalization –Diverse locations result in multiple instances of similar applications and redundant processing. IT Events: Unmanaged software deployment –Overwhelming asset inventory becomes a barrier for asset management personnel. Software/Hardware end of life –Deteriorating systems lose support from vendors and are at risk of data corruption. Business Drivers: Operational inefficiency/low productivity –Complex data analyses, and cumbersome business processes. Inadequate information access –Poor flow of management information, inadequate communication. Poor financial performance –Business performance impacted by inefficiencies and information barriers. IT Drivers: Architectural complexity –Increased infrastructure complexity and costs to run applications. Duplicate or redundant costs –Application licensing, support, maintenance, specialized skills costs. …Drive Consolidation Info-Tech Insight As a result of these business events, 90% of the time the driver to look at for consolidation is rising IT costs and inability of IT to respond quickly to business needs due to a diverse app portfolio with lots of redundancy.

Info-Tech clients recognize when to consolidate; however, without adequate planning, they may not see hoped for gains Info-Tech Research Group9 “[Legacy systems]are so old that… they become very fragile. Original vendor of the development platform had already moved away from this old version and wasn’t even supporting anymore. …so the risk is… if this thing dies it’s not supported by the vendor so we don’t have anyone to call.” -Sandie Terry, IT Director, Franklin Country, VA “One reason is it just gets very costly just to run [duplicating applications]… secondly, it makes it more difficult and harder to integrate new systems… that gets translated into cost and effort as well.” -Partner, IT Strategy Consulting Firm “It’s like a GET-HELP number, and they had multiple numbers… depending on what your issue was where you would call… they’ve got multiple help desks using multiple pieces of software or tools… there was no communication between the tools or the software packages.” -Peter Valters, General Manager, Professional Services, Empowered Networks

Info-Tech Research Group Perform an inventory assessment to find areas where consolidation will provide benefits 10 “We had to overcome the attitude of ‘I like what we do; everybody else’s is junk. Get rid of theirs, keep ours, make them do it our way,’ that was across the board.” - Peter Valters, General Manager, Professional Services, Empowered Networks Growth by acquisition with no follow-up software integration projects. Help desk duplications. Outages caused external customer complaints. Unable to track the source of service outages due to lack of information flow. ActionSituation Pain PointsKey Success Factors A new tool was introduced. Savings reported based on financial case and the TCO were evident. Presentations delivered to senior management first, then went in-depth down the management ladder. Identified gaps and overlaps through incident management. Performed tool analysis through application inventory for pros & cons. Established requirements. Aligned the requirements with business needs. Strong feelings of ownership for the existing help desk applications. End-user pushback from the organization against changing existing processes. Plan for consolidation with each acquisition event based on business need and best fit. Software redundancy and complexity could potentially hurt the company reputation. Increased efficiency and productivity for help desk and customer service staff. Improved customer satisfaction from reduced outage incidents. Reduced IT maintenance and support cost by eliminating redundant systems and licenses. Values and Lessons Learned

Map business functions to all applications within the scope of the review and business strategy. Use established criteria and decision tree to identify best consolidation candidates. Document project proposals and present recommendations to senior management for approval. Identify applications to consolidate in three project phases: inventory, evaluate, justify Info-Tech Research Group11 Assess Current State Phase 1 Identify Consolidation Candidates Phase 2 Secure Management Support Phase 3 Before beginning the consolidation project, this assessment provides support in identifying consolidation candidates that are most likely to deliver the expected business value.

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