Application Sourcing

Sourcing is often used to refer to Outsourcing and Offshoring of application maintenance, development and service delivery tasks. This models can represent attractive propositions, particularly in the drive to improve the bottom line. However, without the intelligence to drive careful planning, the identification of suitable applications most suitable for transition, and the ability to measure performance against SLA stipulations, the overall value derived from such engagements can be seriously restricted.

Outsourcing and Offshoring

An organization’s competitive advantage is embodied in the often complex portfolio of applications contained within its walls, and in the business processes that these represent. And yet, maintaining these applications can often consume as much as 80% of the IT budget, seriously impacting the ability to grow and drive innovation at both a technical and business level. Despite being a central platform which governs all business activity, these applications have often become a barrier to the very success that put them there in the first place, and a major distraction from core business pursuits.

Outsourcing represents an attractive proposition, and has worked well for many companies, but it can also lead to nightmares where the client is left ‘holding the bag’ without the resources or documentation to rectify the problem. Deriving maximum value from an outsourcing engagement relies on careful planning, starting with a thorough understanding of those applications most suitable for transition to an outsourcer, and those which are best retained in-house.

Once the decision has been made, the time taken to transfer control and the efficiency with which the outsourcer is able to start maintaining the applications, can seriously impact the overall value delivered by the project.

APM offers both the end user and the outsourcer the ability to effectively manage the transfer process, by enabling the careful documentation of the entire portfolio. By detailing where the value lies and where the complexity exists, both parties have a precise insight into their own boundaries of responsibility which helps reduce the likelihood of unexpected surprises emerging at a later date.

Once underway, the success of the contract relies heavily on the accurate sharing of information, and on the ability of the outsourcer to drive efficiency into the management of the application portfolio now under their control.   APM enables consultants to become effective quickly, to provide detailed documentation throughout project engagements, and to assess the risks and likely effectiveness of consolidation and simplification activities to drive further cost and efficiency benefits.

CIO / Executive

The decision to outsource is never taken lightly. For every successful engagement described in the press, there would appear to be an equally unsuccessful one vying for scrutiny. The battle to get the outsourcing balance right in any organization is not an easy one, and a variety of engagement models exist, which further highlights the fact that no best-practice approach has emerged that can stand up to business scrutiny. Therefore, risk mitigation is vital and having access to detailed fact-based information on which to base strategic decisions about the future management of the IT portfolio is an essential first step. This information can then guide the selection of suitable outsource candidates and act as the benchmark to measure performance and compliance levels as the contract unfolds.

Architect

Much of the preparation for application outsourcing falls to the IT Architect, to engage with the outsourcer in describing the scope, current state and future goals of the infrastructure. Managing this process of communication relies heavily on accurate, documented information about the applications, their complexity and potential value to be obtained from each one within the context of a rationalised portfolio. Both a high-level view, across the entire enterprise, and the deeper introspection of each application being considered is required to provide the architect with this type of information. A similar level of insight is required for the on-going management of the outsourcer, to ensure that future state projections remain in line with the evolving needs of the business. 

Technical

Technicians, working as part of an outsourcer engagement, can benefit enormously from a rapid understanding of the applications on which they are working. Portfolio simplification brings with it a requirement to reach inside the individual applications and programs to seek out redundancy and duplication. The insight provided through automatically generated documentation, impact analysis and complexity metrics can boost developer efficiency by between 10% and 30% alone.

Conclusion

Solid APM discipline is vital when any outsourcer is engaged, not only in ensuring the initial contract and project terms are laid out correctly and in keeping both high-level and deep-dive portfolio information, but also in the on-going management of the project – ensuring that the delivery of business value remains firmly at the forefront of the outsourcer’s mind.