As the IT needs of an organization evolve, and existing systems age, it is critical to look at application modernization using an integrated approach that covers the complete breadth of applications and systems used within the organization.

Starting with a portfolio view of applications is fundamental to the effective management of a modernization journey. The parallels between general IT portfolio management and integrated organizational modernization planning allow the application of best practice approaches to application modernization. Understanding a department�s constellation of applications, where they add value or meet operational needs, allows risks, priorities, costs and interdependences to be identified. This leads to integrated planning where limited resources can be applied to the most effective projects. 

For example, it may not make sense to embark on a large-scale application redesign for a system that delivers little value. In other cases, small incremental projects designed to reduce application interdependencies can reduce the risk and complexity of follow-on replacements. 

Awareness of other systems in use by the organization can provide valuable insight to important key strategic questions. Can existing platforms be leveraged to replace legacy systems? Is the organization moving to specific technology stacks and architectures? Do standards and guidelines exist? Not only is the portfolio view a starting point for any modernization journey; its maturity, quality, completeness and alignment with organizational objectives will assist in determining the path forward. 

The following six-step framework offers a starting point to applying portfolio management approaches to legacy application modernization:

1.Identify your portfolio of applications 

Starting with an inventory of the application landscape is a critical starting point: what applications does the organization currently support? Who supports them? And where are they? This is not only important to ongoing IT operations, budgeting and planning, but also acts as the foundation for modernization planning. A complete picture drives better decision making. 

2.Determine business value tied to these applications

Each application within the inventory should generate some form of value. There are applications that support services delivered to clients and constituents. Some are tied to internal processes and controls; others are mandated by legislative compliance. Understanding the value applications deliver and how they do so allows the most important systems to be targeted and the cost/benefit of future projects to be understood.

3.Ascertain legacy risk profile of these applications

Not all applications present the same level of legacy risk. Certain applications have limited flexibility and cannot be easily changed; others will have become brittle. Some will suffer from security vulnerabilities; others will lack the parts, people or expertise to be supported. These characteristics rather than the age of the system should be used to measure legacy risk.

4.Understand application interdependencies 

In an ideal world, every application would be a discrete entity that could be easily replaced without impact. Unfortunately old legacy systems are often the ones most embedded into those around them. Like IT coral, new applications are layered and wrapped around the existing applications, making them difficult to replace. By understanding the interdependencies between legacy and other applications, it is possible to identity subsystems that are easiest to replace and those that will present a greater challenge. This awareness allows smaller interim projects to be identified and interdependencies reduced before embarking on larger replacement projects. When it comes to estimating the cost of replacing an application, often integration activities represent the greatest risk and under-estimation of effort.

5.Prioritize applications requiring modernization

The dimensions of business value, legacy risk, and application interdependencies form the basis of modernization planning activities. By identifying those applications delivering the highest business value with the greatest legacy risk, one can focus limited resources on projects that are expected to deliver the greatest benefit. The ideal outcome is a roadmap of a balanced set of large, lower risk projects complimented by smaller, higher risk activities designed to mitigate the risk of future projects.

6.Repeat

As legislative mandates and program priorities change, so does the context that drives the prioritization of projects and activities. As a result, this process should be performed on an ongoing basis (or at a minimum reviewed quarterly). This is part of the never-ending reality of application modernization.

Approaching application modernization as set of integrated activities using mature application portfolio management tools is a powerful way to improve the outcomes of complex and often highly interrelated modernization projects.  

Kelly McDonald is a manager in Deloitte's Systems Integration, Application Modernization and Technology, Media and Telecommunications consulting practices ( This email address is being protected from spambots. You need JavaScript enabled to view it. ).