2.9. Application Inventory and Discovery Basics

Creating a comprehensive application inventory is the cornerstone of any successful Application Portfolio Management (APM) initiative. Without a clear understanding of what applications are in use, their purpose, and their associated costs and risks, organizations cannot make informed decisions. This section covers the basics of building an inventory, outlining approaches, tools, and best practices for effective application discovery.

2.9.1. Why an Application Inventory Is Essential

• Visibility:
  • Provides a complete view of the organization’s application landscape, including redundant, outdated, and underutilized systems.
• Decision-Making:
  • Enables data-driven decisions about application rationalization, modernization, and investment.
• Compliance and Risk Management:
  • Identifies unsupported or non-compliant applications, reducing security and regulatory risks.
• Cost Optimization:
  • Highlights opportunities to eliminate unnecessary licenses, reduce maintenance costs, and reallocate resources.

2.9.2. Approaches to Application Discovery

Organizations can use a combination of manual and automated methods to create an accurate application inventory:

• Manual Methods:
  • Surveys and Interviews:
    • Engage application owners, department heads, and end-users to identify the systems they use, their purpose, and their perceived value.
    • Pros: Provides qualitative insights into application usage and satisfaction.
    • Cons: Time-consuming and prone to inaccuracies due to human error.
  • Documentation Review:
    • Audit existing documentation, contracts, and procurement records to identify applications.
• Automated Methods:
  • Discovery Tools:
    • Use tools like Configuration Management Databases (CMDBs), IT Asset Management (ITAM) systems, or APM platforms to scan the IT environment and generate an inventory.
    • Pros: Faster and more accurate than manual methods.
    • Cons: May require additional setup and integration efforts.
  • Network and Usage Monitoring:
    • Analyze network traffic and usage logs to identify applications, especially shadow IT.
    • Example Tools: Microsoft SCCM, ServiceNow Discovery, or cloud-based monitoring solutions.

2.9.3. Data Collection Essentials

When building an inventory, focus on collecting key data points that support decision-making. The following categories are essential:

• Application Details:
  • Name, version, vendor, and purpose of each application.
• Usage Metrics:
  • Number of users, frequency of use, and criticality to business processes.
• Financial Data:
  • Licensing costs, maintenance fees, and total cost of ownership (TCO).
• Technical Information:
  • Hosting environment (on-premises, cloud), integrations, and dependencies.
• Business Value:
  • Alignment with strategic goals, revenue contribution, or operational impact.
• Risk and Compliance Data:
  • Security vulnerabilities, end-of-life status, and regulatory requirements.

2.9.4. Tools for Beginners

Organizations just starting with APM can leverage simple, cost-effective tools to create an application inventory:

• Spreadsheets:
  • Tools like Microsoft Excel or Google Sheets provide an accessible way to organize application data.
  • Best for: Small organizations or pilot projects.
• Entry-Level CMDBs:
  • Configuration Management Databases such as ServiceNow (basic editions) or OpenDCIM help track applications and their dependencies.
  • Best for: Mid-sized organizations looking for a more structured approach.
• Discovery Tools:
  • Tools like SolarWinds or Lansweeper automate application discovery and inventory creation.
  • Best for: Organizations with larger, more complex environments.

2.9.5. Prioritizing Applications for Inventory

Given the complexity of most IT environments, it may not be feasible to inventory every application at once. Instead, prioritize:

• High-Cost Applications:
  • Focus on applications with significant licensing or maintenance costs.
• Business-Critical Applications:
  • Identify systems that support core business processes or customer interactions.
• Legacy and Aging Applications:
  • Evaluate older systems that may pose risks or require modernization.
• Applications with Known Issues:
  • Target applications with frequent performance problems or user complaints.

2.9.6. Common Challenges in Inventory Creation

Organizations often encounter challenges when building an application inventory:

• Incomplete or Inaccurate Data:
  • Data gaps can lead to incorrect decisions.
  • Solution: Use multiple discovery methods (manual and automated) to validate data accuracy.
• Resistance from Stakeholders:
  • Some teams may hesitate to share information about their applications.
  • Solution: Clearly communicate the purpose of the inventory and involve stakeholders early.
• Shadow IT:
  • Applications acquired outside of IT oversight may be missed.
  • Solution: Use network monitoring tools to detect unapproved applications.

2.9.7. Early Wins from a Basic Inventory

Even a simple inventory can deliver significant benefits:

• Identifying Redundancies:
  • Discovering duplicate applications reduces costs and complexity.
• Retiring Unused Applications:
  • Eliminating underutilized systems frees up resources for strategic initiatives.
• Highlighting Risks:
  • Flagging unsupported or non-compliant applications enables proactive risk mitigation.

2.9.8. Case Study: Building an Inventory

• Scenario: A mid-sized healthcare organization wanted to optimize its application portfolio.
• Approach:
  • Conducted manual surveys of department heads.
  • Used a lightweight CMDB to consolidate data.
• Outcome:
  • Identified 15 redundant applications and retired them, saving $200,000 annually.
  • Improved visibility into application usage, supporting future rationalization efforts.

2.9.9. Key Takeaways

• An accurate application inventory is the foundation of APM, enabling informed decision-making and strategic alignment.
• Start with simple tools and prioritize high-impact applications to achieve early success.
• Use a combination of manual and automated methods to ensure data accuracy and completeness.

2.9.10. Conclusion

Creating a basic application inventory is a critical first step in APM. By gathering essential data, prioritizing high-value applications, and leveraging simple tools, organizations can gain the visibility needed to optimize their portfolios. The next section will explore how to analyze the collected data and use it to make informed portfolio decisions.