IT Portfolio Rationalization: The $8M Hidden in Redundant Applications

Your CFO just asked a simple question: "How many applications do we have?" IT couldn't answer. Three weeks and €35K in consulting fees later, the discovery: 427 applications. Further analysis reveals: 89 applications serve redundant functions, 47 applications have <10 active users, 23 applications haven't been updated in 5+ years, and 12 applications have no identified owner. Combined annual cost of these 171 applications: €2.8M. That's €2.8M spent maintaining applications delivering minimal or zero business value.

According to Gartner's 2024 Application Rationalization Study, the average enterprise maintains 25-35% more applications than necessary, with overlap, redundancy, and abandonment consuming €8-15M annually for mid-market organizations. The root cause: Applications accumulate over years through mergers, departmental purchases, and pilot projects that never sunset—but nobody has a systematic process to evaluate and eliminate waste.

The solution is IT portfolio rationalization—a data-driven framework to identify, evaluate, and eliminate redundant or low-value applications while optimizing the remaining portfolio.

Why application portfolios become unmanageable:

Problem 1: Nobody knows what they have

The discovery nightmare:

Question from CFO: "How many applications do we have and what do they cost?"

Typical IT response process:

1. Week 1: Check CMDB (Configuration Management Database) → 180 applications listed
2. Week 2: Survey departments → Discover 140 additional applications IT didn't know about
3. Week 3: Analyze credit card statements → Find 67 more SaaS subscriptions
4. Week 4: Network traffic analysis → Identify 40 more cloud applications
5. Total discovered: 427 applications (2.4x what IT thought)

Why the inventory is unknown:

Cause 1: Decentralized purchasing

• Departments buy SaaS with credit cards (bypassing IT)
• No central approval or tracking
• IT discovers only when problems occur

Example: Marketing team buys 8 different tools over 3 years (HubSpot, Marketo, Mailchimp, Hootsuite, Canva, SurveyMonkey, Zoom Webinar, LinkedIn Sales Navigator). IT knows about 2 of them.

Cause 2: M&A accumulation

• Acquire company, inherit their applications
• No systematic integration or consolidation
• Years later, still running duplicate systems

Example: Company acquires 3 competitors over 5 years, each with their own ERP, CRM, HRMS. Now running 4 ERPs (original + 3 acquired), 4 CRMs, 3 HRMS systems. Total annual cost: €4.2M vs. €1.8M for consolidated single systems.

Cause 3: Shadow IT and pilot projects

• Pilot project approved for 6 months
• Project never officially ends, just continues running
• Years later, still paying subscription
• Original sponsor left company, nobody owns it

Example: Data analytics pilot (Tableau) started 4 years ago for 3-month evaluation. Never officially approved or rejected. Still paying €48K annually. Active users: 2 (down from 12 at pilot). Nobody remembers original business case.

The inventory problem impact:

• Can't optimize what you don't know exists
• Duplicate spending invisible (no consolidated view)
• Compliance risk (unmanaged applications with sensitive data)
• Security exposure (unpatched, unmonitored applications)

Problem 2: Massive redundancy and overlap

The redundancy explosion:

Typical patterns:

Pattern 1: Functional redundancy (multiple tools doing same thing)

Example discovery: Collaboration tools inventory

• Microsoft Teams (enterprise license, 1,200 users)
• Slack (840 users across 12 departments)
• Zoom (580 users)
• WebEx (320 users from acquisition)
• Google Meet (240 users)
• Discord (45 users in IT team)

Total annual cost: €385K
Redundancy: 90% functional overlap
Consolidation potential: Standardize on Teams (already licensed) + Zoom for webinars = €185K annually, save €200K

Pattern 2: Data redundancy (same data in multiple systems)

Example: Customer data stored in:

• Salesforce CRM (primary)
• Marketing automation (Marketo)
• Customer support (Zendesk)
• E-commerce platform (Shopify)
• Data warehouse (Snowflake)
• Legacy CRM (still running)
• Excel spreadsheets (departmental)

Problems:

• 7 different "sources of truth" for customer data
• Data inconsistencies and conflicts
• Manual reconciliation required (15 hours weekly)
• Integration complexity (14 point-to-point connections)

Cost: €180K annually maintaining integrations + €95K data quality issues

Pattern 3: Departmental silos (each department buys own tools)

Example: Project management tools by department

• IT: Jira (€42K)
• Marketing: Asana (€24K)
• Operations: Monday.com (€28K)
• Product: ClickUp (€18K)
• Finance: Smartsheet (€15K)
• HR: Trello (€8K)

Total: €135K annually for 6 different PM tools with 95% overlapping features

Consolidation: Standardize on 2 tools (Jira for technical, Asana for business) = €66K, save €69K

Pattern 4: Acquisition overlap (inherited duplicates never consolidated)

Real example: Healthcare company acquired 2 regional chains

• Now running 3 Patient Management Systems (original + 2 acquired)
• 3 Billing Systems
• 3 Electronic Health Record (EHR) systems
• 2 Lab Information Systems

Annual cost: €6.2M (3 PMSs, 3 Billing, 3 EHRs, 2 LIS)
Optimal cost: €2.8M (1 PMS, 1 Billing, 1 EHR, 1 LIS)
Waste: €3.4M annually maintaining redundancy

Rationalization blocker: "Too complex to consolidate, business can't handle disruption"
Reality: 5 years post-acquisition, still no consolidation plan

The redundancy cost formula:

Annual Waste = Σ(Redundant licenses + Redundant maintenance + Integration overhead + Data quality issues + Training duplication)

Typical waste: 25-35% of application portfolio budget

Problem 3: Zombie applications (abandoned but still running)

The walking dead of IT:

Zombie characteristics:

• <10 active users (or zero users)
• No recent updates or enhancements
• No identified business owner
• Still consuming budget
• "Nobody dares to turn it off"

Typical zombie examples:

Zombie 1: The forgotten pilot

• Started: 3 years ago as 6-month pilot
• Status: Never officially approved or rejected, just forgotten
• Active users: 2 (original pilot team, now doing it out of habit)
• Annual cost: €35K
• Business value: Zero (pilot never achieved objectives)

Zombie 2: The replaced system

• Replaced by new system 2 years ago
• Status: "Temporary" parallel running "just in case"
• Active users: 3 (viewing historical data monthly)
• Annual cost: €85K (license + infrastructure + maintenance)
• Alternatives: Export historical data to archive, decommission system, save €85K

Zombie 3: The orphaned acquisition

• Came with acquisition 4 years ago
• Status: Acquired company's employees migrated to parent systems
• Active users: 0 confirmed
• Annual cost: €120K
• Nobody knows: What it does, who owns it, can we turn it off?
• Fear factor: "Might break something if we shut it down"

Zombie 4: The compliance placeholder

• Created for regulatory requirement 6 years ago
• Status: Requirement no longer applicable (regulation changed)
• Active users: 12 (monthly compliance report they don't read)
• Annual cost: €42K
• Business value: Compliance theater

Discovery: Large retailer zombie inventory

• Total applications: 387
• Zombies identified: 63 applications
  • Zero users: 18 applications
  • <5 users: 28 applications
  • No owner: 17 applications
• Total zombie cost: €1.8M annually
• Action: Decommissioned 48 zombies over 12 months
• Savings: €1.4M annually

Why zombies persist:

Reason 1: Fear of breaking something

• "What if someone needs it?"
• "What if it's connected to something important?"
• Risk-averse culture: Easier to keep paying than take risk

Reason 2: No ownership or accountability

• Original sponsor left company
• No current owner to approve shutdown
• IT won't decommission without business approval
• Business won't approve (don't know what it does)

Reason 3: No systematic review process

• Applications deployed but never reviewed
• No "use it or lose it" policy
• No consequences for maintaining unused applications

Problem 4: Technical debt and security risks

The hidden costs of legacy applications:

Cost category 1: Maintenance burden

Legacy application characteristics:

• Technology: 10-15 years old, outdated platforms
• Vendor support: End-of-life or limited support
• Skills: Hard to find developers, expensive specialists
• Dependencies: Incompatible with modern infrastructure

Real example: Legacy Java application

• Age: 14 years (Java EE on WebLogic)
• WebLogic support: End-of-life announced
• Java version: Java 7 (current: Java 21, 7 is unsupported)
• Developer skills: 2 developers in company know WebLogic, both nearing retirement
• Annual maintenance: €180K (vs. €45K for modern equivalent)

Cost multipliers:

• 3-5x higher maintenance than modern equivalent
• 2-3x more expensive developer resources (hard to hire)
• 10-15x slower to enhance (old technology, tech debt)

Cost category 2: Security vulnerabilities

Legacy security risks:

• Unpatched software (patches no longer available)
• Known CVEs (Common Vulnerabilities and Exposures)
• No longer compatible with modern security tools
• Can't enforce modern authentication (MFA, SSO)

Real incident: Legacy application breach

• Application: 12-year-old customer portal (Windows Server 2008, IIS 7)
• Status: End-of-life OS and web server
• Vulnerability: Unpatched SQL injection
• Breach: 85,000 customer records exposed
• Cost: €1.2M (investigation + notification + remediation + fine)
• Lesson: €35K annually to maintain legacy vs. €1.2M breach cost

Security rationalization imperative:

• Applications on end-of-life platforms: Immediate replacement or retirement
• Cost of breach >> Cost of replacement

Cost category 3: Integration brittleness

Legacy integration problems:

• Point-to-point connections (no APIs)
• Proprietary protocols or formats
• Breaks frequently when other systems change
• Requires specialized middleware or custom code

Example: Legacy ERP with 24 point-to-point integrations

• Annual integration maintenance: €240K
• Every ERP update: 4-6 week integration repair cycle
• Alternative: Modern ERP with REST APIs = €60K integration maintenance
• Premium: 4x cost to maintain legacy integrations

Problem 5: No business value measurement

The accountability void:

Typical application funding conversation:

Year 1 (Request):

• Business: "We need Application X, it will deliver €500K annual benefit"
• CFO: "Approved, €150K annually"

Year 2-5 (Renewal):

• Finance: "Renew Application X?"
• IT: "Yes, it's in use"
• No validation: Did it deliver €500K benefit? Is anyone using it? Still needed?

Year 6 (Discovery):

• Rationalization review: Application X delivers zero measured value
• Interviews: Nobody can articulate current business value
• Usage: 12 users (down from 85 at launch)
• Annual cost: €150K × 6 years = €900K
• Realized benefit: Unknown, probably <€100K
• Lost value: €800K wasted investment

Why business value isn't measured:

Reason 1: No baseline or success criteria

• Initial business case vague ("improve efficiency")
• No measurable KPIs defined
• No accountability for benefit realization

Reason 2: No ongoing value review

• Approved once, never re-justified
• Annual renewals automatic (no business case required)
• Culture: "We've always had it" is sufficient justification

Reason 3: Separation of cost and value

• IT pays (visible cost)
• Business receives benefit (invisible value)
• No connecting mechanism to compare cost vs. value

The accountability gap:

• 60-70% of applications: No measurable business value tracked
• 40-50% of applications: No clear business owner
• Result: Applications accumulate, nobody accountable for value delivery

The IT Portfolio Rationalization Framework

Systematic process to optimize application portfolio for value and cost.

Phase 1: Discovery and Inventory (Months 1-2)

Step 1: Comprehensive application discovery

Discovery methods:

Method 1: CMDB and IT asset inventory

• Source: IT's configuration management database
• Captures: Applications IT knows about and manages
• Typical coverage: 40-60% of actual applications

Method 2: Financial analysis

• Source: Credit card statements, procurement records, invoices
• Search: Software vendors, subscription patterns
• Typical findings: 30-40% additional applications (shadow IT)

Method 3: Network traffic analysis

• Source: Firewall logs, proxy logs, CASB (Cloud Access Security Broker)
• Captures: SaaS applications accessed by users
• Typical findings: 20-30% more applications

Method 4: User surveys

• Source: Survey all employees
• Question: "What applications do you use for your work?"
• Typical findings: 10-15% more (local tools, scripts, Excel macros)

Consolidated inventory:

• Combine all discovery methods
• Deduplicate (same app discovered multiple ways)
• Result: Complete application list (250-500 applications typical for mid-market)

Investment: €40-80K (analysis tools + consultant time + survey)

Step 2: Application profiling

For each application, collect:

Technical profile:

• Application name and version
• Vendor and licensing model
• Deployment model (SaaS, on-premise, hybrid)
• Technology stack and dependencies
• Integration points (what connects to this)
• Security and compliance classification

Business profile:

• Business capability supported (what does it do)
• Business owner and IT owner
• Department/function served
• User base (number of users, roles)
• Criticality to business operations

Financial profile:

• Annual license/subscription cost
• Infrastructure cost (servers, storage, network)
• Maintenance and support cost
• Internal labor cost (IT support, administration)
• Total Cost of Ownership (TCO)

Usage profile:

• Active users (last 30/90 days)
• Usage frequency and patterns
• Peak usage periods
• Adoption rate (actual vs. licensed users)

Value profile:

• Original business case and objectives
• Measured benefits (if any)
• Business satisfaction score
• Strategic alignment

Deliverable: Application portfolio inventory with complete profiles

Investment: €60-120K (data collection + stakeholder interviews + analysis)

Phase 2: Assessment and Prioritization (Month 3)

Evaluate each application on two dimensions:

Dimension 1: Business value (Low to High)

Factors:

• Criticality: How essential to operations? (1-10 scale)
• Strategic alignment: Supports strategic objectives? (Yes/No/Partial)
• Business satisfaction: Users satisfied? (1-10 scale)
• Realized benefits: Delivered promised value? (Yes/No/Partial)
• Uniqueness: Provides unique capability? (Yes/No)

Score: Sum and normalize to 1-10 scale

Dimension 2: Technical fitness (Poor to Excellent)

Factors:

• Technology currency: Modern platform? (1-10 scale)
• Vendor viability: Vendor stable and investing? (1-10)
• Security posture: Secure, patched, compliant? (1-10)
• Integration quality: Well-integrated or point-to-point? (1-10)
• Maintenance burden: Easy or hard to maintain? (1-10)

Score: Sum and normalize to 1-10 scale

Application portfolio matrix:

Technical Fitness →
│
│ Invest        │ Migrate
│ (High value,  │ (High value,
│  good tech)   │  poor tech)
├───────────────┼────────────
│ Tolerate      │ Eliminate
│ (Low value,   │ (Low value,
│  good tech)   │  poor tech)
↓
Business Value

Quadrant decisions:

Invest (High value + Good tech):

• Action: Enhance and expand
• Examples: Modern CRM with high adoption, Cloud ERP delivering value
• Investment: Continue funding, add features

Migrate (High value + Poor tech):

• Action: Replace with modern equivalent
• Examples: Legacy ERP (critical but old), End-of-life platform
• Investment: Migrate to modern platform (12-24 month project)

Tolerate (Low value + Good tech):

• Action: Keep but optimize cost
• Examples: Nice-to-have tools, low-usage but modern
• Investment: Renegotiate licenses, reduce user count

Eliminate (Low value + Poor tech):

• Action: Decommission
• Examples: Zombies, redundant tools, failed pilots
• Investment: Sunset (3-12 month decommissioning)

Step 3: Rationalization opportunities

Opportunity 1: Consolidation (eliminate redundancy)

Identify:

• Multiple applications serving same function
• Functional overlap >70%

Example: 6 project management tools → 2 tools (technical + business)

• Savings: €69K annually
• Effort: 3-6 months migration

Opportunity 2: Decommissioning (eliminate zombies)

Identify:

• <10 active users
• No clear business owner
• Low business value score

Example: Decommission 48 zombie applications

• Savings: €1.4M annually
• Effort: 12-month decommission program

Opportunity 3: Renegotiation (optimize licensing)

Identify:

• Over-licensed (paying for 500 users, using 200)
• Poor license type (enterprise when business tier sufficient)
• No volume discounts (could negotiate better rates)

Example: CRM over-licensed by 40%

• Current: 500 licenses at €150/user = €75K
• Actual usage: 280 active users
• Renegotiate: 300 licenses at €135/user = €40.5K
• Savings: €34.5K annually

Opportunity 4: Replacement (eliminate technical debt)

Identify:

• High maintenance cost (3x+ modern equivalent)
• Security risks (end-of-life platforms)
• Poor integration (point-to-point spaghetti)

Example: Replace legacy ERP

• Current TCO: €850K annually
• Modern SaaS ERP: €420K annually
• Savings: €430K annually
• Migration cost: €1.2M (3-year payback)

Deliverable: Prioritized rationalization roadmap with 3-5 year plan

Investment: €50-90K (assessment + prioritization + roadmap)

Phase 3: Execution (Months 4-36)

Execute rationalization initiatives in priority order:

Wave 1: Quick wins (Months 4-6)

Focus: Low-hanging fruit with immediate savings

Initiatives:

• Decommission obvious zombies (zero users)
• Cancel unused subscriptions
• Renegotiate over-licensed applications
• Consolidate easy redundancies (similar tools in same department)

Investment: €80-150K (project management + migration support)
Savings: €400-800K annually (quick payback)

Wave 2: Consolidation projects (Months 7-18)

Focus: Eliminate redundancy through standardization

Initiatives:

• Consolidate collaboration tools (6 → 2)
• Consolidate project management (6 → 2)
• Standardize document management
• Eliminate departmental silos

Investment: €400-700K (migrations + change management + training)
Savings: €600-1.2M annually

Wave 3: Major replacements (Months 12-36)

Focus: Replace legacy applications in "Migrate" quadrant

Initiatives:

• Replace legacy ERP with modern SaaS
• Migrate end-of-life platforms
• Modernize custom-built applications

Investment: €2-4M (major transformation projects)
Savings: €800-1.5M annually + strategic value

Phase 4: Ongoing Governance (Month 12+)

Prevent re-accumulation:

Governance process 1: New application approval

Gate: No application deployed without approval

Approval criteria:

• Business case with measurable benefits
• No redundancy with existing applications
• Technical fit and security review
• Defined business owner and funding

Governance process 2: Annual portfolio review

Review each application:

• Still delivering value?
• Usage still justifies cost?
• Technical health acceptable?
• Continue, optimize, or eliminate?

Policy: Applications must re-justify annually or face elimination

Governance process 3: Continuous monitoring

Track metrics:

• Portfolio size (number of applications)
• Portfolio cost (total TCO)
• Application value score (aggregated)
• Redundancy index (% overlap)
• Zombie count (<10 user applications)

Alert: Dashboard flags issues for review

Investment: €40-70K annually (governance process + tools)

Benefit: Prevent €500K-1M annual portfolio bloat

Real-World Example: Manufacturing Company

In a previous role, I led portfolio rationalization for a 2,400-person global manufacturing company.

Initial State:

Discovery (Month 1-2):

• IT-known applications: 210
• Actual applications discovered: 487 (2.3x)
• Shadow IT: 277 applications (57% of portfolio)

Financial analysis:

• Annual portfolio cost: €8.4M
• Cost breakdown:
  • Licenses/subscriptions: €5.2M
  • Infrastructure: €1.8M
  • IT support: €1.4M

Portfolio health:

• Redundancy identified: 127 redundant/overlapping applications
• Zombies: 68 applications (<10 users each)
• Legacy high-risk: 23 applications (end-of-life platforms)
• Over-licensed: 89 applications (using <60% of licenses)

Assessment (Month 3):

Portfolio matrix:

• Invest (high value, good tech): 87 applications (€2.8M TCO)
• Migrate (high value, poor tech): 45 applications (€2.1M TCO)
• Tolerate (low value, good tech): 108 applications (€1.4M TCO)
• Eliminate (low value, poor tech): 247 applications (€2.1M TCO)

Rationalization opportunity: €2.1M (Eliminate) + 40% of €1.4M (Tolerate optimization) + 30% of €2.1M (Migrate replacement savings) = €3.29M annual savings potential

The Transformation (36-Month Program):

Wave 1: Quick wins (Months 4-9)

Initiatives:

• Decommissioned 52 zombie applications (zero users confirmed)
• Cancelled 34 unused SaaS subscriptions
• Renegotiated 28 over-licensed applications
• Consolidated 3 easy redundancies (intra-department)

Investment: €180K (project management + legal + migration support)
Savings: €980K annually

Wave 2: Consolidation (Months 10-24)

Major consolidations:

Project 1: Collaboration tools

• Before: Microsoft Teams, Slack, Zoom, WebEx, Google Meet, Discord
• After: Teams (primary) + Zoom (webinars)
• Savings: €240K annually

Project 2: Project management

• Before: Jira, Asana, Monday, ClickUp, Smartsheet, Trello
• After: Jira (technical), Asana (business)
• Savings: €95K annually

Project 3: Document management

• Before: SharePoint, Box, Dropbox, Google Drive, local file servers
• After: SharePoint Online + OneDrive
• Savings: €180K annually

Project 4: Customer data consolidation

• Before: 3 CRMs (original + 2 acquisitions)
• After: Salesforce (consolidated)
• Savings: €420K annually

Total Wave 2:

• Investment: €840K (migrations + training + change management)
• Savings: €935K annually

Wave 3: Legacy replacement (Months 18-36)

Project 1: ERP replacement

• Before: Legacy SAP ECC 6.0 (€1.2M TCO)
• After: SAP S/4HANA Cloud (€650K TCO)
• Savings: €550K annually
• Investment: €2.8M (migration)

Project 2: HR system modernization

• Before: Legacy PeopleSoft (€380K TCO)
• After: Workday (€220K TCO)
• Savings: €160K annually
• Investment: €680K (migration)

Project 3: End-of-life application replacement

• Replaced 8 EOL applications with modern SaaS
• Savings: €280K annually
• Investment: €420K

Total Wave 3:

• Investment: €3.9M
• Savings: €990K annually

Governance (Month 12+):

Implemented:

• New application approval gate (prevents shadow IT)
• Annual portfolio review process
• Application value scorecards
• Executive dashboard (portfolio health metrics)

Investment: €90K setup + €60K annually

Results After 36 Months:

Portfolio transformation:

• Applications: 487 → 245 (50% reduction)
• Shadow IT: 277 → 18 (93% reduction)
• Redundancy: 127 overlaps → 12 (91% reduction)
• Zombies: 68 → 3 (96% reduction)
• Legacy high-risk: 23 → 2 (91% reduction)

Financial impact:

• Starting TCO: €8.4M annually
• Ending TCO: €4.9M annually
• Annual savings: €3.5M (42% reduction)

Investment:

• Wave 1: €180K
• Wave 2: €840K
• Wave 3: €3.9M
• Governance: €150K
• Total: €5.07M

ROI:

• Annual savings: €3.5M
• Payback: 17 months
• 5-year ROI: 245%

Additional benefits:

• Security posture: Improved (eliminated 21 EOL applications)
• IT efficiency: 30% IT support time freed up (simpler portfolio)
• User satisfaction: 6.2/10 → 8.1/10 (better tools, less confusion)
• Agility: New capability deployment 40% faster (less integration complexity)

Challenges:

Challenge 1: Change resistance (Months 10-20)

• Departments attached to "their" tools
• "Our tool is different/better" arguments
• Solution: Executive sponsorship + user involvement in selection

Challenge 2: Data migration complexity (Months 18-30)

• ERP migration: 15 years of historical data
• Solution: Phased migration + data quality remediation

Challenge 3: Skills and training (Months 10-36)

• Users trained on old tools, resistance to new
• Solution: Comprehensive training + change champions

CIO reflection: "Portfolio rationalization was our most impactful cost optimization initiative in 10 years. The eye-opener was discovering we had 487 applications when IT thought we had 210. The savings—€3.5M annually—were substantial, but the strategic value was even greater: Simpler portfolio, better security, faster innovation. The key success factor was treating it as a continuous process, not a one-time project. Our new governance ensures we'll never accumulate this level of waste again."

Your IT Portfolio Rationalization Action Plan

Optimize your application portfolio to eliminate waste and improve value.

Quick Wins (This Week)

Action 1: Quick discovery (3-4 hours)

• Export CMDB/asset inventory (IT-known apps)
• Review last 12 months credit card statements (shadow IT)
• Quick survey to 5-10 managers (what apps do teams use?)
• Expected outcome: Initial app list (50-80% coverage)

Action 2: Identify obvious zombies (2-3 hours)

• Review usage data (if available)
• Identify apps with <5 users
• Identify apps with no clear owner
• Expected outcome: 10-20 decommission candidates

Action 3: Quick wins (immediate)

• Cancel obviously unused subscriptions
• Challenge renewal of low-usage applications
• Expected outcome: €20-50K immediate annual savings

Near-Term (Next 90 Days)

Action 1: Comprehensive discovery (Weeks 1-6)

• Multi-method discovery (CMDB + financial + network + survey)
• Complete application inventory
• Initial profiling (name, cost, owner, users)
• Resource needs: €40-80K (tools + analysis)
• Success metric: 95%+ application coverage

Action 2: Assessment and prioritization (Weeks 6-12)

• Application portfolio matrix (value vs. technical fitness)
• Identify rationalization opportunities
• Build business case for rationalization program
• Resource needs: €50-90K (assessment + stakeholder engagement)
• Success metric: Approved rationalization roadmap

Action 3: Quick wins execution (Weeks 8-16)

• Decommission zombies (low-hanging fruit)
• Renegotiate over-licensed apps
• Easy consolidations
• Resource needs: €80-150K (project execution)
• Success metric: €400-800K annual savings

Strategic (18-36 Months)

Action 1: Consolidation program (Months 6-24)

• Eliminate redundancy through standardization
• Consolidate shadow IT into managed services
• Optimize licensing across portfolio
• Investment level: €600-1.2M (migrations + change management)
• Business impact: €800-1.5M annual savings

Action 2: Legacy replacement (Months 12-36)

• Replace high-risk EOL applications
• Modernize legacy platforms
• Reduce technical debt
• Investment level: €2-4M (major transformations)
• Business impact: €600-1M annual savings + strategic value

Action 3: Ongoing governance (Months 12+)

• New application approval process
• Annual portfolio review
• Continuous monitoring and optimization
• Investment level: €90K setup + €60K annually
• Business impact: Prevent €500K-1M annual waste accumulation

Total Investment: €2.86-5.61M over 36 months
Annual Savings: €2-4M
Payback: 10-21 months
5-Year ROI: 175-350%

Take the Next Step

Organizations waste 25-35% of application portfolio budgets on redundant, overlapping, or unused applications. Systematic portfolio rationalization reduces costs 30-40% while improving capability, security, and agility.

I help organizations execute IT portfolio rationalization programs that balance cost reduction with business value. The typical engagement includes comprehensive discovery, portfolio assessment, rationalization roadmap, and governance design. Organizations typically achieve 20-30% cost reduction in 18-24 months with strong ROI.

Book a 30-minute portfolio optimization consultation to discuss your application landscape. We'll assess your rationalization opportunity, identify quick wins, and design an execution roadmap.

Alternatively, download the Portfolio Rationalization Toolkit with templates for application discovery, assessment frameworks, and business case development.

Your application portfolio is hiding €2-8M in waste. Discover and eliminate redundancy before your CFO asks the uncomfortable question: "How many applications do we really need?"