Application portfolio optimization (APO)—which starts with application portfolio rationalization—is one of the most effective ways for an IT organization to tackle bloated overhead and run costs.

APO moves a company’s existing technology applications toward more modern, flexible, and
cost-effective solutions. It involves reviewing and aligning applications with business objectives and ensuring that all of them provide necessary functionality at the lowest cost possible, while still maintaining flexibility.

When implemented correctly, APO has the power to enable substantial transformation in an organization within a short time frame.

Consider that the average IT organization uses only half its applications on a daily basis. Yet, even when unused, old applications require maintenance and run costs that increase over time and have a dramatic (and negative) impact on overall IT spend—not to mention increased security risks.

Without APO, IT can be … Impact
Slow Agility is critical to business success, but maintaining legacy processes siphons time and resources away from incubating new, revenue-impacting technologies.
Expensive Legacy systems face dwindling support systems and lack an active transformation roadmap, hindering the ability to modernize.
Complicated Legacy systems face dwindling support systems and lack an active transformation roadmap, hindering the ability to modernize.
Overwhelming Application development teams are overrun with service demands to correct defects, forcing staff to be reactive rather than proactive.

Unfortunately, APO is often considered a major transformation project that will simply cost too much for an already cash-strapped IT organization. However, when done successfully, APO will help an IT organization:

  • Achieve significant savings
  • Drive down future costs exponentially
  • Improve staff skills and capabilities
  • Increase productivity of tools and processes

And furthermore, with the right assessment methods, sourcing strategies, and supplier partnerships, transformation can be achieved as part of business as usual.

Wavestone US has helped our clients save million of dollars in IT and application spend. Want to know the impact APO can have on your organization? Contact our experts to learn more.


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