Self-fund the Initiative
Success factor No. 3: Self-fund the initiative There's no denying that an application modernization plan requires significant investment. But allocating the dollars to initiate the process presents a challenge, particularly in today's uncertain economy.The firm had developed an in-house enterprise solution and then purchased a commercial application to replace it. Over time, the homegrown application was never retired and the vendor no longer supported the commercial application. A third enterprise application was then implemented. But, instead of replacing the two earlier systems, it was simply integrated to work with them. The solution was to consolidate the three systems into one, and to apply the cost savings to the next phase of the transition.
One way to address this challenge is to develop a plan focused on specific steps, resulting in quantifiable savings, and then to reinvest those initial savings to fund subsequent stages of the process. In one real-world example, an organization was spending 40 percent of its application development budget (around $2.5 million annually) just to maintain the interfaces between three disparate systems.