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The race for technology modernization is now a race for survival. This is why, according to new research from Infosys, 70 to 90% of the legacy systems that exist today will be modernized within five years.
However, despite the urgency, enterprises are steering clear of rip-and-replace tactics, opting for phased modernization instead. The reasons range from the risk and cost of “big bang” implementation, to its outdated image, to the impracticality of eliminating core legacy applications. On the other hand, the relatively low cost and near-zero disruption of progressive modernization, and its assurance of business continuity, weigh heavily in its favor.
Besides, this approach sits well with the four things that are essential to a comprehensive IT modernization program – a data-driven enterprise, adoption of hybrid cloud, focus on user experience and connections via APIs.
Modernization makes the data-driven enterprise
A data-driven enterprise is precisely that; it is an enterprise that integrates rich data to run day-to-day business processes, operations and decisions, and improves them over time.
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Data-driven organizations combine digital technologies such as robotic process automation, artificial intelligence, machine learning, cloud and analytics to automate the enterprise, anticipate customer needs, predict and respond to events in real-time, innovate and personalize products, devise new business models, and learn continually. For example, a data-driven enterprise might use data to discover inefficient processes, identify alternatives and even automate those that are routine and rule-based. Further, by bringing in machine learning, it can set in motion a continuous cycle of learning and improvement.
Unfortunately, the majority of organizations are nowhere close to being data-driven. The reasons are familiar; namely, legacy systems, multiple technology stacks, outdated processes, and data silos that are inefficient, inflexible, sluggish and opaque – in other words, antithetical to the principles of a data-driven enterprise.
Modernization mitigates these challenges to a great extent. Simplifying monolithic, interdependent systems with the help of platform-based components and open-source software solutions improves agility, adaptability and flexibility; also, a componentized core system is perfect for phased modernization.
Microservices, APIs (application programming interfaces), and webhooks enable data sharing within the enterprise – with AI, RPA, analytics and other solutions – to enable straight-through processing, and with the external ecosystem to improve innovation and business decisions. In fact, survey respondents from the above-mentioned research ranked APIs, AI and microservices as the biggest drivers of modernization among enterprises, next only to data and analytics.
Last but by no means least, modernization readies the organization for cloud.
Modernization and cloud need each other
Modernization and cloud are so interlinked that it is difficult to imagine one without the other. Modernization makes enterprise systems cloud-ready, so they can work with various as-a-service models and also cloud-native applications. In turn, cloud was the single biggest accelerator of digital transformation, and the singular reason for remote-working success during the pandemic.
Organizations continuing their modernization journey should consider hybrid cloud before any other option. Hybrid cloud acts as a bridge between on-premises and cloud infrastructure to accelerate modernization programs.
A mix of the public and private clouds of multiple providers, hybrid cloud packs the advantages of both; namely, the agility, scalability and cost-efficiency of public cloud, and the control, security and reliability of private cloud. What’s more, it enables enterprises to leverage interoperability between private and public cloud platforms.
With its elastic, virtually unlimited computing capacity, access to myriad applications, and support for information sharing, hybrid cloud is more than capable of meeting the extensive data and analytics requirements of data-driven organizations. Also, infrastructure on hybrid cloud makes for better business processes, improving everything from customer experience to regulatory compliance to staff productivity.
Modernization is pointless without a UX to match
Users within the enterprise are demanding intuitive, frictionless experiences just like customers outside; studies show that a huge majority of people stop using apps on account of poor user experience (UX).
Hence when modernizing their legacy technology landscape, enterprises should modernize the UX as well. This means redesigning front-end interfaces to ease access to data, cut down redundant processes and introduce efficient ones, minimize “clicks” with automated assistance features, make navigation of the new system intuitive, and so on.
While changing the infrastructure improves the performance of a system, changing the UX improves the performance of its users. A point to note is that usability encourages adoption of the system among users, which is key to scaling the benefits of modernization across the enterprise.
Modernization via APIs connects the enterprise
Large organizations with complex technology landscapes – for example, multiple core platforms that are not neatly integrated – may need to undertake several modernization initiatives in parallel to shorten timelines. APIs enable this by modularizing the architecture, and decoupling core platforms so they can be modernized.
After that, APIs play a crucial role by facilitating integrations and data exchange between platforms, applications, channels, etc. throughout the enterprise.
IT modernization was always important, but during the pandemic it became a staple for survival. Today, the pandemic may have receded, but modernization still needs to move forward. While different organizations will take different journeys to modernization, they will cross the same milestones – data, hybrid cloud, user experience and APIs – along the way.
Gautam Khanna is the vice president and global head of the modernization practice at Infosys.
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