Application Lifecycle Management in a Multi-Vendor Landscape: Getting it Right

As part of a strategy to maximize flexibility, simplicity, and efficiency for states and providers, Centers for Medicare & Medicaid Services (CMS) has required that states overhaul their approach to implementing Medicaid Enterprise Systems (MES). As a result, states have been steadily transitioning their Medicaid Management Information Systems (MMIS) from single, monolithic functions to integrated systems with multiple vendors handling different Medicaid functions. With the modular approach, states are able to take advantage of the latest technologies and vendor specializations, while implementing new business processes more quickly and cost effectively. It also opens opportunities for many small vendors who offer various MES modules as Commercial Off the Shelf (COTS) services.

While the move toward a multi-vendor environment signals major progress for the public sector, as with anything new, it also introduces a fresh set of challenges that state agencies must navigate. For example, it’s significantly changing a core component of MES: Application Lifecycle Management (ALM).

In this blog, we’ll highlight some of the obstacles states can expect when managing the application lifecycle in a multi-vendor landscape. We’ll also introduce strategies state MES implementation teams can deploy for a more seamless transformation to a modular landscape.  

The complexities of ALM in a multi-vendor environment

Application Lifecycle Management (ALM) is about ensuring the steps required to build, deploy, and maintain an application are completed across all stages of development. It includes the people, processes, and technology through which an organization manages the lifecycle of its systems. Until now, states have contracted a singular vendor for the Design, Development & Implementation (DDI) and ongoing maintenance of their MES. This made planning and execution fairly straightforward for the MES implementation teams. In a modular environment, states will need to work with multiple vendors that have different processes for managing the application lifecycle. In some cases, states will need to operate with a mix of legacy and new systems, built on multiple technologies and platforms and managed by a variety of vendors with different ways of working. Naturally, this variability will create challenges—especially across three aspects of ALM: delivery, operations, and governance.

Component one: Delivery

Delivering ALM at the enterprise level is about building effective software engineering processes, starting from requirements management all the way to deployment. To successfully build these processes in a multi-vendor environment, you’ll need to effectively manage seven key aspects of ALM. We’ve broken them down below and share strategies to help you deliver:

  • Requirements: Establish a standardized process for managing requirements—including Requirements Traceability Matrix (RTM) management, impact analysis, prioritization, and scheduling—to ensure consistent delivery across vendors. Each vendor may have its own approach for consuming new requirements or configurations as they pop up, but when it comes to managing them, there must be structure and alignment between vendors.
  • Enterprise architecture and design: In a multi-vendor environment, ensure architecture principles and design standards—the cornerstones of your state’s IT strategy—are consistent across all vendors. Without these guardrails, it will become increasingly tough to orchestrate the complexity of an MES implementation and keep technical debt in check.
  • Development and configuration: Be sure to centralize decisions about changes to items like codebase or product features. It’s critical to coordinate and communicate between the multiple vendors developing the system—each with its own software configuration tools and processes—to address the implications of changes and meet requirements.  
  • Testing: Centralize product and integration testing to ensure the full system functions properly. Rigorous testing is critical in a modular environment, where vendors are significantly dependent upon one another and must work in lockstep to meet requirements.
  • Defects and issues: Establish guidelines for defect triaging, Root Cause Analysis (RCA), and prioritization of issues that cross-vendor boundaries. This will give all vendors a clear view of the processes needed to manage, mitigate, and resolve bugs efficiently and effectively.
  • Build and release: Be sure to vet release packages provided by each vendor. In doing so, consider dependencies and identify any upgrades required to maintain software and hardware to meet requirements and remain compliant.
  • Environment: Give each vendor team plenty of time in integration environments to test releases and iterate as needed. Establishing proper environment management processes will help vendors meet their delivery Service Level Agreements (SLA) and keep the whole system on track for delivery. Without coordinated access to these environments, a vendor might end up overriding configuration changes made by another vendor, thus delaying the testing cycles and releases.

Component two: Operations

When various vendors are involved, it can be difficult to determine who is responsible for operating what. Operating and supporting ALM is about measuring the performance of applications in production, deploying changes, creating reports for stakeholder consumption, and managing and monitoring infrastructure. To successfully operate in a multi-vendor environment, consider the following aspects:

  • Operations training: Take a holistic approach to training the operations and support teams. In other words, ensure the training is focused on the business process as a whole rather than vendor-specific components. As new features or changes are pushed to production, be sure to update policies and procedures accordingly.
  • Operations Readiness Testing (ORT): Understand dependencies between vendors supporting the same business processes. This will help you establish appropriate SLAs to stay on track for production release. 
  • Compliance management: Address regulatory requirements with processes for managing compliance holistically. In other words, deploy SLAs, standardized processes, and procedures across vendors to meet and remain compliant in the areas of data security, infrastructure security, software and hardware versioning, and change management.
  • Monitoring and reporting: Create a clear plan for monitoring and collecting data spanning multiple vendor applications. Your approach will depend on the environment in which modules are hosted—whether that’s on-prem, on cloud, or a mix of both (hybrid).

Component three: Governance

Unexpected issues can crop up at the project or enterprise level. Proper governance will help your team navigate these unanticipated challenges and accelerate decision-making. Prioritize the following to stay on track:

  • Plan and project management: Leverage a Roles Assignment Matrix (RACI) to establish your organizational structure and hierarchy. Clarity around these parameters will promote communication and collaboration between vendors. With an integrated team, you’ll find it’s easier to prioritize and sequence the activities that will deliver value. In addition, a project management office (PMO) and the appropriate project management methodology—such as waterfall, Agile, or hybrid—are essential for success in a multi-vendor environment. Notably, a PMO can help you establish a gating process to vet vendor deliverables before they are implemented into the full system. This quality control function is vital for success in a multi-vendor project.
  • Change management: A change management structure is also essential to success. That’s because, in a multi-vendor environment, one small shift could impact various modules and platform services, altering schedules and priorities. With proper change management in place, you’ll be able to identify ripple effects before they happen so you can make more informed decisions that lead to better outcomes.

As states embrace integrated systems, learning how to navigate them can be a difficult task. In order to successfully migrate from a single vendor to a multi-vendor environment, state agencies must account for the considerable changes that come with this type of transition, from technology infrastructure to procurement and business practices. With ALM, addressing the key factors affecting the management of their multi-vendor environments can help states take advantage of all that a modular landscape has to offer.  


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