The R Portfolio Assessment Matrix

The 4R portfolio assessment matrix contains four categories with suggested actions — the four Rs — that guide decisions. Sorting assets into a differentiated portfolio reduces the magnitude of the legacy problem with a strategy of divide and conquer. IS managers who understand the relative scale, size, and investment in each of the applications acquire insights that guide future action.

Category 1: Low Business Value, Low Technical Condition; Action: Retire .If a system performs a function of questionable value unsatisfactorily, why is it running in the first place? These systems, which constitute about 25 percent of the North American legacy base, are excellent candidates for early retirement or benign neglect. If they must be kept alive, IS managers should consider installing a graphical user interface on top of the character-based screen. Selective system improvement is another option, but only if the cost can be justified with business results.

Category 2: Low Business Value, High Technical Condition; Action: Reassess

IS managers should reassess why a high-performance system is contributing so little to the business. These systems, only about five percent of the installed base, may not have been well justified with an adequate case for action. Alternatively, over time a justification may have become outdated. In other cases, rollout may have been mishandled. IS managers should consider moving these assets to more critical applications if they still are capable of providing business value and to a phased retirement if they are not.

Category 3: High Business Value, Low Technical Condition; Action: Redevelop About half of legacy systems fall into this category. These systems may require pampering; yet the business still depends on them. IS managers should strive to maintain business support, retain asset value, and improve functionality where appropriate — all while reducing cost. This can be done in many ways, for example, by extracting business rules from operational systems, developing value-

based cases for action that support replacement, or developing a strategy for gradually substituting new functionality for old.

Category 4: High Business Value, High Technical Condition; Action: Renew

About 20 percent of legacy systems are in this ideal asset state of delivering tangible business value and being in good technical condition. It is an unfortunate truth that most applications started off in this quadrant or were targeted to start in this quadrant but have since fallen out of it. The organizational mission regarding these systems is to preserve asset value by allowing them to migrate forward as business goals and technologies change.

After assessment, IS managers can look beyond the immediate and see the problems with legacy systems as products of root causes. Rather than viewing legacy applications as fragile and redundant, the IS function can move to extend the useful life of these legacy assets. By addressing the causes of these problems — which are often not technical issues — IS managers can move to prevent the all-too-rapid decline in business value and technical condition experienced with most applications.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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