How does benchmarking contribute to Application Portfolio Management (APM)?

Benchmarking plays a crucial role in Application Portfolio Management (APM) by enabling organizations to compare their application performance, costs, and effectiveness against established industry standards or best practices. This comparative analysis helps organizations identify gaps in their own application performance, thereby allowing them to make informed decisions regarding which applications to maintain, upgrade, or retire.

By leveraging benchmarking data, organizations can understand how their application portfolio stacks up against peers in their industry, which can directly influence strategic planning and resource allocation. This process fosters a culture of continuous improvement, as organizations utilize benchmarks to drive enhancements in efficiency and effectiveness across their applications.

In contrast, eliminating all legacy applications may not be practical since some legacy systems might still provide significant business value, and a budget for application development typically arises from strategic decisions rather than being influenced solely by benchmarking data. Mandating the use of new technologies does not directly correlate with benchmarking and may not always align with a company's goals or the performance insights gained from benchmarking analysis.