Transcript Presentation Title - IPMA | Leadership Education Networking

Applications 2020:
Creating Your Survival Strategy
Ian Finley
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You Don’t Need an Application Strategy
An application strategy is a process
of continuous iteration
driven to improve business value
by engaging all stakeholders
in measuring the current state
of your application portfolio
and developing options for improvement.
© 2015 Gartner, Inc. and/or its affiliates. All rights reserved.
You Need a Survival Strategy
Your Application Strategy for 2015-2020
should be a crisis management plan
to rescue the enterprise from
the shantytown of accidental architecture
inherited from 20th century IT culture
by creating an organization
that will deliver services fit for purpose
for a 21st century enterprise.
© 2015 Gartner, Inc. and/or its affiliates. All rights reserved.
© 2015 Gartner, Inc. and/or its affiliates. All rights reserved.
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4
Plan the Portfolio – Not Just Projects
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5
Guide Investment with a Pace Layered
Strategy
Pace Layered Application Strategy™
Systems of Innovation
New Idea
“I don’t know
exactly what I
want. I need to
experiment.”
Systems of Differentiation
Systems of Record
Better Idea
“I know what I
want, but it needs
to be different from
my competitors.”
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Common Idea
“I know what I want
and it doesn’t have to
be unique.”
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An Example: Fishbook
Fishbook
Fishing
License
System
Permits
System
System of Innovation
System of Differentiation
System of Record
Adjust to New Technologies
Time to Cloud
First
Systems of Innovation
Systems of Differentiation
Systems of Record
Last
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Match the Investment to the Need
Systems of Innovation
Planned Life
3 to 12 months
Approximately
$100,000
Planned Life
2 to 5 years
$1 million to
$10 million
Planned Life
10 or more years
$10 million to
$100 million
or more
Refactor
Systems of Differentiation
Refactor
Systems of Record
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Different Ideas Need
Different People, Process and Technology
Systems
of Record
Systems
of Differentiation
Integrated,
commoditized, stable
Highly configurable and
customizable
Pace of
Change
Slow, infrequent,
incremental (every 6 to
12 months)
Moderate, more frequent
(every 3 to 6 months)
Lifetime
10+ years
2 to 5 years
Strategic
Focus
Standardization;
operational efficiency
Agility/flexibility;
competitive differentiation
High executive
engagement;
low end-user
engagement
High LOB executive
engagement;
moderate end-user
engagement
Disruptive thinking;
alternative business
models
Moderate executive
engagement;
high end-user
engagement
Capex and opex;
annual budget
Capex and opex;
IT budget or departmental
Departmental opex;
innovation fund
Attributes
Business
Processes
Stakeholders/
Ownership
Funding
© 2015 Gartner, Inc. and/or its affiliates. All rights reserved.
Systems
of Innovation
Experimental,
ambiguous, dynamic,
ad hoc
Rapid, very frequent,
ad hoc (weekly,
sometimes daily)
3 to 12 months
Evaluate the Total Experience of Ownership –
Not Just Project Cost
Value
Value/Business Benefit
Cost
Project
Expense
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Project Capital Depreciation
Ops Cost
App Maint.
Upgrade
Expense
…
Time
The Budget Crisis
Project
B
Project
C
Budget
Project
A
Project
D
Maint.
Maint.
Base
Maint.
1990
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1991
...
2010
Technical Quality/Condition
Rationalize the Portfolio with TIME
Great
Tolerate
Invest
Eliminate
Migrate
Poor
Low
High
Business Value
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Generate Options – Not Road Maps
Option 1: Do Nothing
Option 3: SaaS
Costs
Costs
Benefits
Benefits
Risks
Risks
Option 2: Upgrade
Option n: nnnnnnn
Costs
Costs
Benefits
Benefits
Risks
Risks
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Application Portfolio Management (TIME)
Meets Systems of Innovation
Excellent
Cost and Risk
(Architecture &
Staffing)
Tolerate
Invest
Differentiation
Success
Eliminate
Failure
Migrate
Innovation
Problematic
High
Low
Application “Value” or Fit to the
Mission, Mandate or Process Need
© 2015 Gartner, Inc. and/or its affiliates. All rights reserved.
Application Portfolio Management (TIME)
Meets Systems of Differentiation
Excellent
Cost and Risk
(Architecture &
Staffing)
Tolerate
Record
Differentiation
Lost Over Time
Invest
Differentiation
Too Brittle
Differentiation
Eliminate
Migrate
Problematic
High
Low
Application “Value” or Fit to the
Mission, Mandate or Process Need
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Application Portfolio Management (TIME)
Meets Systems of Record
Excellent
Cost and Risk
(Architecture &
Staffing)
Tolerate
Stabilize &
Reduce Spend
Record
Invest
Record
Replace
System
Eliminate
Migrate
Problematic
High
Low
Application “Value” or Fit to the
Mission, Mandate or Process Need
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Link Retirement to Acquisition
New
Young
Adolescent
Prime
Mature
New
Mature
Young Adolescent
Prime
The Typical Portfolio, 2015
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Senile
Zombie
The Theoretical Balanced Portfolio
Reduce Technical Debt With Every Project
2014
Project success today
- On time
- On budget
- On specification
- On value (rare)
Phase 1
Phase 2
Phase 3
Phase 4
Phase 5
Success tomorrow
Others
- Today's metrics +
Retire Sys 1
- Percentage of functions retired
Retire Sys 2
- Percentage of functions reused
Retire Sys 3
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2015
2016
2017
7 Steps to Managing the Crisis
1. Plan the portfolio – not just projects
2. Guide Investments with a Pace Layered
Strategy
3. Evaluate total ownership experience – not just
project cost
4. Rationalize the portfolio with TIME
5. Generate options – not roadmaps
6. Link retirement to acquisition
7. Reduce technical debt with every project
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20
You Need a Survival Strategy
Your Application Strategy for 2015-2020
should be a crisis management plan
to rescue the enterprise from
the shantytown of accidental architecture
inherited from 20th century IT culture
by creating an organization
that will deliver services fit for purpose
for a 21st century enterprise.
© 2015 Gartner, Inc. and/or its affiliates. All rights reserved.
Recommended Gartner Research
 Pace-Layered Application Strategy and IT
Organizational Design: How to Structure the
Application Team for Success
Mary Mesaglio and Matthew Hotle (G00238542)
 Ten Questions to Test the Quality of Your
Application Strategy
Bill Swanton (G00222580)
 Use the Pace-Layered Application Strategy
to Understand Your Applications Portfolio
Darryl Carlton and others (G00232225)
 Managing Application Strategy Through Multiple
Hype Cycles
Andy Kyte (G00231347)
© 2015 Gartner, Inc. and/or its affiliates. All rights reserved.