Why rationalization is the feasibility test for core change
Core banking modernization succeeds or fails based on the current application estate’s ability to absorb change. Application Portfolio Rationalization (APR) turns ambition into evidence by showing which applications can tolerate core change, which must be remediated first, and which dependencies make a staged approach unavoidable.
For leaders, the feasibility question is binary: can the bank execute core modernization without unacceptable operational disruption? APR answers that question by exposing hidden coupling, fragile interfaces, and legacy behaviors that create non-negotiable sequencing constraints.
Feasibility signals APR must surface
Dependency exposure around core services
APR must reveal upstream and downstream consumers of core services—channels, product processors, finance, risk, and reporting. Where documentation is thin, structured discovery and dependency mapping identify interfaces and batch flows that would otherwise be missed in planning.
High dependency density signals that a “big bang” cutover is unrealistic and that remediation or parallel running will be required to avoid service instability.
Process and data coupling that blocks safe sequencing
Rationalization that maps applications to business capabilities shows where multiple systems embody conflicting business rules and data definitions. Those conflicts create governance work that must be completed before core change can safely proceed.
Operational fragility under parallel change
Modernization increases change volume. If the portfolio includes unsupported platforms, brittle integrations, or manual operating procedures, the bank’s ability to run parallel stacks is compromised. APR exposes these fragilities so leaders can gate modernization until remediation plans exist.
What APR proves (or disproves) before core change
- Sequencing realism: whether dependencies allow staged migration or force a high-risk cutover.
- Control continuity: whether decommissions and migrations can meet audit, retention, and evidence requirements.
- Delivery capacity: whether operational and engineering teams can sustain dual-running without destabilizing the bank.
How to run APR as a feasibility gate
Set scope around core-adjacent applications first
Feasibility testing should focus on systems that consume, wrap, or replicate core behavior. These applications create the highest change risk and must be understood before peripheral systems.
Define decision rights and go/no-go criteria up front
Leaders should define the conditions that must be met to proceed: dependency transparency thresholds, remediation readiness, and evidence that critical processes can operate during transition.
Classify applications by modernization constraint
Beyond standard value and fit classifications, the feasibility lens should identify which applications hard-depend on legacy behaviors, which can consume target APIs with minimal change, and which must be retired before a core program can safely start.
Translate findings into a sequencing roadmap
APR outputs should drive a modernization sequence that reduces the highest-risk dependencies first, resolves data and process conflicts early, and preserves operational stability while core change is underway.
Common feasibility failure modes
Undocumented dependencies discovered late
Late discovery of batch jobs, data extracts, and embedded business logic expands scope and forces timeline resets.
Parallel-run burden exceeds operating capacity
If the bank cannot support dual environments with strong controls and monitoring, modernization becomes fragile and execution risk escalates.
Regulatory constraints block decommissioning
Record retention, audit evidence, and reporting obligations can prevent rationalization actions that the modernization plan assumes.
Feasibility validation through capability benchmarking
APR provides dependency and portfolio evidence, but leaders also need a view of organizational readiness—governance, data discipline, change control, and resilience. A maturity-based baseline helps validate whether the bank can execute a core program without increasing operational risk. In this decision context, the DUNNIXER Digital Maturity Assessment connects portfolio findings to enterprise capability readiness, enabling a confident go/no-go decision.
Reviewed by
The Founder & CEO of DUNNIXER and a former IBM Executive Architect with 26+ years in IT strategy and solution architecture. He has led architecture teams across the Middle East & Africa and globally, and also served as a Strategy Director (contract) at EY-Parthenon. Ahmed is an inventor with multiple US patents and an IBM-published author, and he works with CIOs, CDOs, CTOs, and Heads of Digital to replace conflicting transformation narratives with an evidence-based digital maturity baseline, peer benchmark, and prioritized 12–18 month roadmap—delivered consulting-led and platform-powered for repeatability and speed to decision, including an executive/board-ready readout. He writes about digital maturity, benchmarking, application portfolio rationalization, and how leaders prioritize digital and AI investments.
References
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- https://www.quinnox.com/blogs/benefits-of-application-rationalization/#:~:text=Application%20rationalization%20delivers%20financial%20savings,than%20just%20a%20support%20function.
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- https://evolveware.com/application-rationalization-taming-the-digital-jungle-for-enterprise-transformation/#:~:text=Application%20Portfolio%20Rationalization%20is%20the,term%20continuity%20of%20the%20business.
- https://www.leanix.net/en/wiki/apm/application-rationalization#:~:text=Every%20application%20being%20used%20at,applications%20before%20purchasing%20additional%20ones.