Over time, organic company growth and M&A activity leave organizations with a dense jungle of applications. Organizations end up paying for redundant software licenses associated with multiple tools. Further, teams consume significant maintenance capacity simply to keep aging systems alive. Many leaders struggle to answer this key question: “How do I reduce redundant software license costs after M&A activity?”

In this post, we’ll examine why active application rationalization is essential to gain control of total cost of ownership.

The "so what?": The hidden traps of application sprawl

  • Redundant expenditures: Enterprises pay for duplicate HR, finance, and tracking systems across acquired business units.

  • Technical debt accumulation: Legacy systems consume outsized labor and maintenance costs simply to stay operational.

  • Capital lock-in: Capital trapped in low-value, high-cost legacy applications cannot be redirected toward innovation or strategic initiatives.

The core insight: Active application lifecycle management

In many organizations, teams struggle with application rationalization because retiring software requires deliberate governance choices. How can enterprise leaders evaluate application cost versus business value to reduce technical debt?

Evaluating systems on a cost-versus-value grid reveals which applications deserve investment, which require cost mitigation, and which must be decommissioned. In this effort, Clarity® by Broadcom is invaluable.

How does Clarity help guide application portfolio rationalization? Using Clarity, leaders build a centralized inventory of application investments. Clarity captures ownership, operating costs, business value, and maintenance labor. The solution then provides clear visualization models to help leaders identify low-value, high-cost software and free up budget for modern technology layers. (For more information on how Clarity can help your organization, see our solution brief, “Ending Tool Sprawl to Deliver Strategic Efficiency.”)

 

Shift your strategy: From application sprawl to portfolio optimization

Stop: Allowing legacy applications to remain online long past their useful operational life.

Start: Cataloging all enterprise software investments, owners, and ongoing operational costs in Clarity.

Stop: Treating all software applications as equal funding priorities.

Start: Mapping applications on a cost-versus-value quad chart in Clarity to prioritize retirement candidates.

Stop: Sinking ongoing operational budget into low-value software.

Start: Reallocating freed capital and labor capacity toward higher-value digital capabilities.

 

The bottom line: You cannot optimize what you do not catalog. Use Clarity to rationalize your application portfolio, eliminate technical debt, and redirect budget toward strategic growth.

To continue the discussion, please contact us for a demo or conversation.

Frequently asked questions

Q: Why do organizations contend with application sprawl and mounting technical debt?

A: Organic company growth and M&A activity often result in organizations accruing duplicate applications, paying multiple software licenses for redundant tools, and expending an inordinate amount of maintenance capacity simply to keep legacy systems alive.

Q: How does a cost-versus-value quad chart help rationalize software portfolios?

A: Evaluating systems on a cost-versus-value grid reveals which applications justify continued investment, which require cost mitigation, and which low-value, high-cost systems should be decommissioned.

Q: What role does Clarity by Broadcom play in managing application portfolios?

A: Clarity captures application ownership, operating costs, business value, and maintenance labor in a centralized inventory. With the solution, leaders can visualize inefficient software and free up budget for modern technology layers.

Q: What is the most important initial step to take in optimizing an enterprise software portfolio?

A: Teams must start by cataloging all enterprise software investments, owners, and ongoing operational costs. It is only when these items have been cataloged that leaders can begin to optimize their portfolios.