Outmoded applications and data explosion hamper enterprises in innovation, move to cloud computing

A proliferation of on-premises applications, many of them outdated, and the ongoing data explosion are posing serious threats to businesses worldwide, according to a recent survey of companies in Europe and America by Capgemini.

The first annual Application Landscape report found that millions of applications are obsolete and no longer deliver full business value. The result, says Capgemini, is a need to rationalize and retire applications, freeing up valuable resources to drive innovation and future growth, rather than maintain outdated systems.

The sheer number of applications supported – up to 10,000 for global enterprises – combined with an estimated average data growth of five percent per month means applications management is on track to quickly become an issue of real significance. Moreover, as companies move toward the transfer of applications to the cloud, the need for systematic and well-managed application retirement will accelerate.

Outmoded applications

In in-depth interviews with CIOs and IT leaders in the US and Europe, Capgemini found that:

• Some 85 percent say their application portfolios are in need of rationalization
• Almost 60 percent of enterprise companies say they currently support "more" or "far more" applications than are necessary to run their business
• Only 4 percent say that every IT system they use is considered to be business critical
• Half agree that up to 50 percent of their application portfolio needs to be retired
• Another 61 percent say they keep all data beyond its expiration date "just in case"
• Also, 56 percent of large companies and enterprises say that half or more of their applications are custom-built, increasing the technical complexity of required platforms and technologies
• Only 13 percent say their application development and maintenance teams are aligned. And half (48 percent) say their teams are only in synch for 50 percent of the time or even less.

Ron Tolido, CTO at Capgemini for Application Services Continental Europe, said: “Our research reveals that key goals for CIOs are value creation, improving efficiencies and cutting costs. Despite the fact that data archiving and application retirement can result in significant cost savings, process efficiencies and increased agility, it still does not rank high enough on the agenda. This report shows that successful application management – achieved through a true lifecycle approach of 'build, deploy, maintain and retire' – can deliver tangible business benefits in tough economic times.”

In addition to acknowledging the growing importance of this issue, the report also reveals the numerous current barriers to effective application management including: the cost of retirement projects, the lack of immediate ROI, cultural resistance to change, regional differences, the lack of qualified developers to migrate retired application data, and most importantly that applications are not considered a key priority.

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