Governance processes form the operational backbone of Application Portfolio Management (APM). For beginners, it is crucial to establish lightweight, scalable, and practical processes that provide structure without overwhelming stakeholders. These processes guide how decisions are made, policies are enforced, and applications are managed throughout their lifecycle.
This section outlines essential governance processes, their purpose, and best practices for organizations just starting their APM journey.
1. Importance of Governance Processes
- Why It Matters:
- Processes ensure consistency and transparency in managing the application portfolio.
- They enable organizations to make data-driven decisions while aligning with policies and strategic goals.
- Governance processes minimize ambiguity by defining clear steps for handling critical tasks such as application onboarding, rationalization, and compliance.
- Key Outcomes:
- Better stakeholder collaboration.
- Streamlined application lifecycle management.
- Enhanced accountability and transparency.
2. Essential Governance Processes for Beginners
a. Application Onboarding Process
- Purpose: Ensure new applications meet organizational standards and align with strategic goals before being added to the portfolio.
- Key Steps:
- Request Submission: Business units or IT teams submit an application onboarding request.
- Initial Review: Evaluate the application’s purpose, alignment with organizational goals, and expected ROI.
- Data Collection: Gather key details such as cost, ownership, compliance requirements, and technical specifications.
- Approval: Governance committee or designated stakeholders review and approve or reject the request.
- Tools: Standardized onboarding templates, checklists, or forms.
b. Application Rationalization Process
- Purpose: Identify and address redundant, obsolete, or underperforming applications.
- Key Steps:
- Data Assessment: Use portfolio data to evaluate applications based on usage, cost, business value, and technical health.
- Classification: Categorize applications into “retain,” “invest,” “retire,” or “replace.”
- Action Plan: Develop and execute a plan for rationalizing targeted applications.
- Stakeholder Engagement: Communicate decisions to relevant stakeholders and ensure smooth transitions.
- Best Practice: Start with quick wins (e.g., retiring duplicate or unused applications).
c. Portfolio Review Process
- Purpose: Regularly assess the health and alignment of the application portfolio with organizational goals.
- Key Steps:
- Define Review Cadence: Conduct reviews quarterly or biannually.
- Analyze Portfolio Data: Evaluate portfolio metrics such as Total Cost of Ownership (TCO), ROI, and usage statistics.
- Prioritize Actions: Identify applications needing investment, upgrades, or rationalization.
- Report Findings: Share insights and recommendations with stakeholders.
- Tools: Dashboards or spreadsheets summarizing key portfolio metrics.
d. Governance Decision-Making Process
- Purpose: Establish a consistent process for evaluating and approving key decisions, such as application investments or retirements.
- Key Steps:
- Define Criteria: Use predefined criteria (e.g., ROI, risk, compliance) to evaluate decisions.
- Involve Stakeholders: Engage relevant stakeholders in discussions to ensure balanced decision-making.
- Document Decisions: Record decisions and rationale for future reference.
- Monitor Implementation: Track the execution of approved decisions.
- Best Practice: Use a RACI matrix to clarify roles in the decision-making process.
e. Compliance and Risk Management Process
- Purpose: Ensure applications adhere to regulatory, security, and internal standards.
- Key Steps:
- Establish Baselines: Define compliance and risk benchmarks for the portfolio.
- Audit Applications: Regularly assess applications for compliance with defined standards.
- Address Non-Compliance: Develop action plans for applications that fail to meet compliance requirements.
- Track Progress: Monitor remediation efforts and update stakeholders.
- Best Practice: Integrate risk assessments into portfolio reviews to streamline processes.
f. Reporting and Metrics Process
- Purpose: Track and communicate governance performance to stakeholders.
- Key Steps:
- Define Metrics: Establish KPIs such as cost savings, rationalization progress, and compliance rates.
- Collect Data: Use tools and systems to automate data collection.
- Generate Reports: Create simple, visually appealing reports or dashboards.
- Distribute Insights: Share findings with governance committees, executives, and application owners.
- Best Practice: Focus on metrics that demonstrate clear value, such as ROI or reduced technical debt.
3. Best Practices for Beginners in Governance Processes
- Start Small and Focused:
- Begin with a few high-priority processes, such as onboarding and rationalization.
- Gradually expand to include more complex processes as governance maturity increases.
- Document Processes Clearly:
- Use flowcharts, templates, and checklists to make processes easy to understand and follow.
- Ensure documentation is accessible to all stakeholders.
- Automate Where Possible:
- Leverage entry-level tools like spreadsheets or basic APM software to streamline repetitive tasks such as data collection and reporting.
- Engage Stakeholders Early:
- Include business and IT stakeholders in process design to ensure buy-in and relevance.
- Use workshops and meetings to gather feedback and refine processes.
- Measure and Refine:
- Monitor the effectiveness of governance processes using KPIs.
- Regularly review and adjust processes based on feedback and outcomes.
4. Common Challenges and Solutions
- Challenge: Lack of stakeholder engagement.
- Solution: Clearly communicate the benefits of governance processes and involve stakeholders in their design.
- Challenge: Overcomplicating processes.
- Solution: Focus on simplicity and scalability, avoiding unnecessary complexity.
- Challenge: Resistance to change.
- Solution: Provide training and emphasize the value of governance in achieving business objectives.
5. Case Study: Simple Governance Processes in Action
- Scenario: A small organization implemented a basic application rationalization process as its first governance initiative.
- Outcome: Within six months, the organization identified and retired 10% of its applications, reducing costs by 15% and freeing up IT resources.
- Key Success Factors: Clear process documentation, stakeholder involvement, and a focus on quick wins.
6. Conclusion
For organizations beginning their APM journey, governance processes should be simple, practical, and results-oriented. By focusing on foundational processes such as onboarding, rationalization, and compliance, organizations can build a strong governance foundation while demonstrating early value. As the organization matures, these processes can evolve and expand to support more advanced governance needs, paving the way for long-term success in APM.
