Optimizing your Applications Portfolio to Achieve High Performance

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Hello and welcome to the Accenture podcast “Optimizing your applications portfolio to achieve high performance.” This third installment of a 4-part series looks at how companies can both cut costs and improve business results by optimizing their application portfolio. Our experience shows that companies can achieve savings and business results when they do two things. • First, industrialize applications and maintenance and • Second, optimize applications. Companies that optimize will have a streamlined IT environment that creates business value. Outsourcing can help companies optimize quickly and at lower risk. Many companies waste time and money on complex and incompatible applications. A recent independent global survey of more than 44 CIOs found they believe are winning the battle on cost, but losing the war on performance. For example, one CIO estimated that IT departments spend up to 85 percent of their time fixing system problems instead of managing technology to advance the business mission of the larger organization. In today’s challenging market conditions, companies can’t afford that. Companies on the journey to high performance simplify their applications portfolios and align IT with business needs. How can you do this? First, look at where you are. Gather data and analyze your portfolio strategy and current situation. Second, identify opportunities for improvement. Develop a clear vision of what you want your Applications portfolio to be, and see how far you have to go. Third, draw a roadmap to the future and follow it. That’s all there is to it. Easy to say, but sometimes hard for companies to do alone. That’s because a company’s legacy IT applications often represent the codified knowledge, expertise and traditions and habits that have helped the company succeed in the past. As organizations grow, they apply fixes, patches, upgrades and other enhancements to those applications. Eventually, the IT applications portfolio looks like the Gordian knot. When Alexander the Great saw the original Gordian knot, he didn’t waste time trying to untie it. Instead, he took out his sword and cut clean through it. Outsourcing can be the sword that lets you cut the Gordian knot of an inefficient, ineffective applications portfolio. Outsourcing offers fast access to the skills and assets necessary to optimize your applications portfolio. Cost savings from outsourcing can even make the optimization self-funding. Accenture believes that application outsourcing and optimization must do three things:
1. Achieve sustainable improvements. We have seen outsourcing services that have even led to new industry standards and capabilities. 2. Cut cost, risk and complexity. A leading aerospace company that worked with an outsourcing provider cut long-term IT costs by 30 percent and eliminated 80 percent of the legacy applications. Fewer applications mean less risk and more control. 3. Continuously innovate. Optimization means more innovation bang for the IT investment buck, because IT executives can invest where the return is great instead of pouring resources into low-value applications. Application outsourcing clients have reaped real benefits from optimizing their application portfolio. For example: • A large global telecommunications company cut the number of its applications by three quarters. As a result, productivity rose and costs fell. • A government agency slashed infrastructure costs by 90 percent and other applications by 40 percent. And a large financial services company outsourced to better align its business systems. The new solution was more reliable and better aligned with the business. In addition, the company’s hardware costs fell by almost half and software costs by almost two-thirds. Leaders in IT performance know how important it is to align IT systems with business and operate them both efficiently and effectively. They measure, monitor, change and replace systems when necessary to support the business. Optimization leads to simpler, more consistent, more up to date and more productive applications environments. Outsourcing can make the review and improvement of IT business processes easier and more timely. Some companies use outsourcing to help drive necessary improvements in software and management practices. To sum up: • Many companies spend too much time and money fixing problems with complex and outdated legacy systems. • Applications portfolio optimization can cut costs, improve productivity and align IT with the company mission. • Outsourcing can be an efficient and effective way for companies to optimize their applications portfolio. • And cost savings achieved through outsourcing can make the application optimization selffunding. Companies that optimize their applications portfolios through outsourcing can spend their IT investment dollars to create value, instead of just fixing problems. Applications portfolio optimization and outsourcing can be an important step on the journey to achieve high performance. To learn more, go to Accenture.com and download the paper Optimizing Your Applications Portfolio to Achieve High Performance. We hope you found the information in this podcast useful. Thank you for listening.
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Optimizing your Applications Portfolio to Achieve High Performance

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