Managing the Application Portfolio

8/3/2019 Managing the Application Portfolio

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Managing the Application Portfolio

Prof. Rushen Chahal



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Agenda

• Key questions on application portfoliomanagement

• IS/IT management methods

• IS/IT environments & application portfolios

• Key issues in application portfolio

•

Generic strategies• Portfolio management principals



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Key Questions on application

Portfolio Management - I• High potential

– Why: not clear

– What: not certain

– How: not yet known

• Strategic

– Why: do we want to do it in strategic terms?

– What: does the system need to do to gain theadvantage?

– How: best to do?



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Key Questions on application

Portfolio Management - II• Key operational

– Why: to improve performance and avoiddisadvantage

–

What: how much improvement? – How: best to do it

• Support

– Why: to reduce costs by improving efficiency

– What: of existing necessary tasks

– How: best to do it?



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IS/IT Management Methods - I

• Demand management – Opportunity seeking

– CSFs

– High potential & strategic IS

• Supply Management – Opportunity taking

–Current problem solving

– Key operational & support IS



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IS/IT Management Methods - II

• High potential (beware)

– Local

– Competitive focus (proactive)

– Technology driven

– Federation – business led, decentralized,entrepreneurial


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IS/IT Management Methods - III

• Strategic (attack)

– Corporate

– Competitive/effectiveness focus

– Business issue driven

– Complex – Organizational planning, idealmultiple methods based on goal seeking

– Coalition



IS/IT Management Methods - IV

• Key operational (explore)

– Backbone: integrated (top down) planning &centralized control

– Reactive: current & effectiveness focus

– Business issues driven



IS/IT Management Methods - V

• Support (safe)

– Traditional: stage of growth, isolatedapplications, & decentralized control

– Reactive: efficiency focus

– IT issue driven



IS/IT Environments &

Application Portfolios• Traditional: support

• Backbone: key operational, support, & littlestrategic

• Opportunistic: High potential, support, littlekey operational, & little strategic

•

Complex: high potential, strategic, keyoperational, & support



Key Issues in Application

Portfolio - I• High potential – Driving forces: new business idea or

technological opportunity

– Requirements: rapid prototyping, identifypotential, & the best method

• Strategic – Driving forces: Market requirements or

competitive pressures

– Requirements: rapid development



Key Issues in Application

Portfolio - II• Key operational

– Driving forces: improving performance, dataintegration, & avoiding disadvantages

–

Requirements: data management, & cost/benefitanalysis

• Support

– Driving forces: legal requirements, & improving

productivity/efficiency, – Requirements: packaged software, & cost control



Generic Strategies

• Centrally planned

• Leading edge

•

Free market• Monopoly

• Scarce recource



Centrally Planned

• Management: central

• Organization: knowledgeable seniormanagement, & integration of IS/IT and

business planning process• IT: services matching business demands

• Line management: identifying IS/IT to

meet business needs• IS: strategic



Leading Edge

• Management: technology creatingbusiness advantages

• Organization: sufficient funding, innovative

IS/IT management, & strong IT• IT: IT push

• Line management: using & identifying IT

advantages• IS: high potential



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Free Market

• Management: end users

• Organization: knowledgeable end users,duplication,& no budget control

• IT: competitive & profit centric

• Line management: identifying source &

control IS/IT development• IS: high potential, & support



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Monopoly

• Management: corporate integration

• Organization: users acceptance ofcentralized policies, & good usage of

resources• IT: satisfying users needs

• Line management: understanding needs

and get resources from central• IS: key operational



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Scarce Resource

• Management: justifying development

• Organization: tight budgetary

•

IT: making and justifying the best use oflimited resource

• Line management: identifying and

justifying business needs• IS: support



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Portfolio Management

Principals• High potential (wild cat - entrepreneur): processR & D, minimal integration, & cost control

• Strategic (stars – developer or empire builder):

continuous innovation, vertical integration, &high value added

• Key operational (cash cows - controller):defensive innovation, effective resource

utilization, high quality• Support (dogs - caretaker): disinvest/rationalize,

efficiency, & sustained quality



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Points to Remember

• Key questions on application portfoliomanagement

• IS/IT management methods

• IS/IT environments & application portfolios

• Key issues in application portfolio

•

Generic strategies• Portfolio management principals



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Question

• How do you apply these applicationportfolio management methods or principleto an e-business?

Managing the Application Portfolio

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