For CIO Professionals

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	January 10, 2007 CIOs: Reduce Costs By Scoring Applications Lower Maintenance Costs And Change IT Demand Governance by Phil Murphy with Laurie M. Orlov, Lauren Sessions	Average: 9  (14 ratings)

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Executive Summary

As long as IT spends the majority of the IT budget for "lights on" operational and maintenance activities against existing applications, CIOs will be criticized by business executives for their inability to respond fast enough to new business needs. IT management can no longer afford to manage its application portfolios blindly but must introduce some transparency and insight into the portfolio. An application scoring mechanism is a first step toward creating better application transparency, providing actionable, objective information about each application that will, in turn, enable better decisions about the proper fate of each application. Application scoring mechanisms give CIOs a rating mechanism that can help them reallocate maintenance dollars to the highest-priority applications while starving commodity applications. These actions will eventually reduce the percentage of the IT budget allocated to maintenance from 80% to perhaps 60% or less, freeing funds for IT innovation.

TABLE OF CONTENTS

• Lights-On Maintenance Costs Are Out Of Control
• Scoring Applications Enables Comparison And Evaluation
• Add Governance Changes And Collection Tools For Success

RECOMMENDATIONS

• Trade Top-Line Budget Increases For A Rationalization Program

WHAT IT MEANS

• Visibility Has A Dark Side
• Related Research Documents

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