Application Portfolio Management (APM) Best Practices

Overview

APM does not operate in a governance vacuum. The decisions that APM surfaces - whether to approve a new application, invest in a significant modernization, retire a business-critical tool, or adopt a new technology standard - are exactly the kinds of cross-organizational technology decisions that Architecture Review Boards, Technology Review Boards, and similar governance bodies exist to review and authorize. When APM governance is disconnected from these bodies, APM recommendations have no standing forum for cross-functional review, no organizational escalation path, and no formal approval mechanism that gives portfolio decisions the authority they require to be acted upon consistently.

Best Practice

Formally connect APM governance to the organization’s existing governance bodies. If an Architecture Review Board or Technology Review Board exists, establish a defined relationship in which portfolio decisions above a defined materiality threshold are presented to and approved by that body. Define the specific portfolio decision types that require governance body review - new application approvals above a cost threshold, major lifecycle transitions for critical applications, significant modernization investment approvals, and adoption of new technology standards that affect the portfolio. Ensure the governance body receives regular portfolio health reporting as a standing agenda item so that its decisions are informed by current portfolio intelligence.

If no appropriate governance body exists, recommend its creation as part of the APM program establishment. An Architecture Review Board or Technology Review Board provides the cross-organizational decision forum that APM requires to govern the portfolio effectively, and its value extends well beyond APM to all significant technology decisions the enterprise makes. Establishing such a body as part of the APM program builds governance infrastructure that benefits the entire organization’s technology discipline.

Benefit(s)

Connecting APM governance to a formal governance body gives portfolio decisions the organizational standing and cross-functional authority they need to be consistently implemented. Governance body review ensures that portfolio decisions reflect the perspectives of all affected stakeholders rather than only the APM function’s perspective. The governance body provides the escalation forum that resolves conflicts between organizational units about portfolio decisions without requiring ad hoc mediation. Where the governance body does not yet exist, establishing it as part of the APM program creates durable governance infrastructure that strengthens the organization’s overall technology management capability.