Unlocking greater flexibility, better agility, and new growth opportunities for ANZ enterprises
Mainframes aren’t exactly front of mind in discussions of IT innovation, but they are still a primary workhorse of modern business. In fact, more than 70 percent of Fortune 500 companies still run business-critical applications on mainframes, and many companies and institutions have legacy mainframes at the core of their data centres. Yet most mainframe applications are based on decades-old coding languages. Their high technical debt makes companies more brittle and less agile because of slow application change and high costs. For these reasons and others, many are eyeing mainframes as the last frontier of cloud migration.
In fact, new Accenture research based on a survey of Australia-New Zealand (ANZ) IT executives finds that modernising mainframes is high on their list of priorities. ANZ enterprises across industries such as government, financial services, insurance, healthcare, and logistics have started to accelerate their mainframe modernisation projects. In fact, our study found that 60% of ANZ enterprises have an active mainframe-to-cloud initiative in progress and another 33% are thinking about it.
What benefits are companies achieving through their mainframe modernisation programs? More effectively integrating existing systems with other platforms is top of mind, as is increasing the agility of applications. Also important are:
• Data accessibility and security. Legacy systems are much more prone to cyber threats and security vulnerabilities, thus putting organizational data at risk. Using the latest technologies like cloud and distributed data warehouses can help with not only securing the data but also making it accessible from anywhere.
• More agile development. Success today depends on being adaptive and responsive to rapidly changing market situations. Modernizing old mainframe systems by migrating to the cloud helps enterprises reap the benefits and capabilities of an advanced system that delivers increased agility, scalability and cost-efficiency.
Overcoming the challenges
Our survey found that, although ANZ companies are making progress in modernising their mainframes, it’s not happening fast enough. Half of the organisations surveyed are only in early stages of their mainframe-to-cloud modernisation initiative while a mere 16% have completed or are nearing completion of a migration.
One major issue has to do with a skills and experience deficit that can prevent them from moving ahead quickly with a mainframe modernisation program and accelerating business value. For example, the majority of ANZ enterprises believe that cloud development is one of the most important sets of expertise required to implement mainframe modernisation. Other requisite skills include:
• Application modernisation
• Cloud solution architecture
• Mainframe development
In response, many ANZ companies are using the capabilities of a vendor/integrator. For example, one financial institution wanted to move its core banking operations off their mainframe to the company’s open, scalable cloud infrastructure with the aim to help break vendor and technology lock-in, improve cost efficiency, enhance IT flexibility, and improve business agility. The client was able to achieve this in a short span of three months by collaborating with Accenture. The company built a complete infrastructure with applications migrated from their mainframe to the cloud.
Mainframes still play an important role with many enterprises, yet they carry with them a variety of burdens. As companies start to realise the benefits of having a much more scalable, agile, flexible, and interoperable systems, the modernisation process will gain further momentum. Enterprises that do not start soon may find themselves lagging within a couple years. Successful mainframe modernisation requires the vision, methods, and capabilities needed to transition existing systems into cloud-based apps that deliver on today’s performance imperatives and create the agility needed to adapt to tomorrow’s requirements.