Steps to find and reduce IT Debt

08.28.2012

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Our recent global survey with Vanson Bourne found that 46% of IT decision makers admitted they did not know the true value of their IT debt and it is estimated to grow on average by nine percent over the next five years. It found that IT debt is poorly understood and that those responsible for mainframe management are not regularly reviewing their corporate application portfolio.

The true cost of the IT debt has been illustrated by recent spectacular financial industry failures[1]. In March 2012, a USA electronic exchange pulled its IPO because of problems with its own trading systems. During the Facebook IPO in May, NASDAQ was unable to confirm orders for hours. A leading Swiss bank lost more than $350 million that day when its systems kept re-sending buy orders, eventually adding up to 40 million shares that it would later sell at a loss. And in August 2012, a securities trading firm lost hundreds of millions when its systems accidentally bought too much stock that it had to unload at a loss.

To address this hidden balance sheet liability, it is imperative to implement an application portfolio management process (APM). Understanding how applications deliver business requirements and identifying the gaps between current and required capabilities, the surplus can then be revealed.  As such, it is vital to implement an effective APM practice when building an application information database. The business case for tool adoption is straightforward: IT will be able to deliver on its requirements in a more cost effective, timely and accurate fashion.

Enterprise Analyzer from Micro Focus on Vimeo.

Here are the steps businesses need to take to reduce their IT debt:

1)  Build an inventory of the applications, using a solution like Enterprise Analyzer that offers a central repository with multiple user access and ability to scale to enterprise requirements.

2) Survey business and technical stakeholders to populate the repository with additional metrics to be overlaid on the “pure” application information captured through static source code analysis. The result will be dashboard views helping decision makers to determine where modernization activity is most required and where it will yield the highest benefit to the business

3) Analyze the applications targeted for modernization to map architectural dependencies and assist developers in their task of modifying them without impacting operations.

4) Create an initial set of reports to understand the application inventory and the system dependencies. Use visual analytical tools to create diagrams depicting application relationships and map the business role of each technical object.

5) Apply querying and impact analysis tools to provide in-depth views of programs and the impact changes will have on dependent objects like data fields passing or receiving values from an item of interest.

6)  Document program logic as represented by the source code, in order to retain information for business analysts and future developers. This will also help identify the critical portions of an application to be re-written or transferred to another platform (packaged or otherwise).


[1] Source: Atlantic Magazine, Software Runs the World: How Scared Should We Be That So Much of It Is So Bad?

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