AMM – SA still lagging behind, but why?

Internationally, Applications Management and Modernisation (AMM) is a well-known and implemented practice that delivers important benefits.

September 30, 2013

By Collin Govender, Vice President Systems Integration at T-Systems in South Africa

South African companies like their international counterparts are faced with complex ICT application landscapes which often feature hundreds if not thousands of applications.

This in turn means that organisations are incurring unnecessary management and operational issues exacerbated by redundant application functionality. In fact experts estimate that one out of five applications are either duplicated or fulfil no significant function.

Both mid-sized and large South African enterprises can greatly benefit from streamlined, standardised application environments that improve not only manageability but also drive down costs. Indeed, these organisations can optimise their business operations within agile ICT environments.

Internationally, Applications Management and Modernisation (AMM) is a well-known and implemented practice that delivers important benefits such as:

• Savings through standardisation and industrialisation;
• Improved quality of service (QoS);
• Greater flexibility and improved availability;
• Greater transparency and predictability; and
• More efficient use of available resources.

Why then the reluctance?

Why then the slower and somewhat reluctant adoption of AMM in South Africa? For one, larger enterprises tend to be hesitant to relinquish control over their IT assets and often use in-house teams to manage their application environments.

Furthermore, the industry is still dealing with legacy issues. With the entry of the outsourcing model a few years ago, many organisations had to deal with below par service and other issues such as cultural and language obstacles. Service Level Agreements (SLAs) weren’t met which impacted business processes and led to escalating operational expenses.

Today, the outsourcing marketplace in South Africa is a strong and established offering; however, some larger organisations continue to remain resistant to handing over control despite the benchmarked benefits and tangible cost savings.

Mid-sized organisation, major gains

The good news is the mid-sized business market is more open to AMM and hopefully will set an example for their larger peers.

For one, a typical mid-sized organisation struggles to afford the skills and knowledge associated with managing complex application environments and therefore understands the value of partnering with an experienced AMM service provider.

Furthermore, by outsourcing to an AMM provider these organisation realise they benefit from the skills, methodologies and best practices which alleviate a lot of the risk involved in streamlining and optimising the application landscape in-house.

Also, the project scope means that the financial investment is pre-determined and no permanent employees for example have to be employed and retained. Again, this mitigates financial expenditure.

Mid-sized organisations are therefore far more flexible when it comes to streamlining their application environments – a trend that is undoubtedly gaining local momentum.

Standards and regulations are met

Another obstacle is the perceived risk associated with an AMM project. Here it is important to note that AMM incorporates best practices and standards such as the IT Infrastructure Library (ITIL), the de facto international standard for service management and aligned with other standards such as CoBIT.

This means the foundation for the planning, delivery and support of IT services is based on industry standards and best practice. It also closely aligns with various other industry regulatory requirements.

The latest iteration of ITIL, version 3 for example closely links best practices and business benefits.

Also, when implementing AMM at any institution, projects are aligned to meet the various and stringent regulatory requirements set by said industry. The institutions in question can therefore rest assured that all the necessary boxes are ticked and adhered to.

All of the above mentioned points make a very solid case why both large and mid-sized SA organisations should investigate an AMM project particularly as it is estimated that they stand to save almost 30% on IT expenditure.

In South Africa, AMM can make a significant difference in optimising business processes while driving down ICT operation expenditure. Furthermore, it can lead to a demand in skills and subsequent services that will benefit local outsourcing service providers and build local skills for SA.