This IDC study evaluates the evolving IT service commonly referred to as application portfolio rationalization. Though vendors have for years offered many discrete elements of this service, only recently have some started to evolve it into a formalized service offering with standardized methodologies and metrics. Though rationalization services in their most basic form involve little more than eliminating old and redundant applications, more advanced services can serve as the hub for a range of transformational and outsourcing offerings.

"More than merely another service designed to help customers reduce the cost of application maintenance, application portfolio rationalization is well-positioned to act as the hub for a variety of services, including application management, IT outsourcing, and legacy modernization," said Barry Mason, senior analyst, Application Outsourcing and Offshore Services. "Service providers that wish to escape the trap of price pressure and offshore commoditization must utilize portfolio rationalization as the trigger point for a variety of other transformational and outsourcing services."