An IT overhaul that doesn’t break the bank

In today's economic climate, where budgets are tight, businesses can no longer afford to take a rip and replace approach to technology. By Rob Chapman, vice-president and managing director of Unisys UKMEA


However, that doesn’t mean the requirement to modernise or refresh a company’s IT infrastructure has receded, quite the opposite. IT remains the bedrock of their organisation’s success.

Large enterprises with a proud heritage will often battle a reputation for being slow to respond, stuffy and bureaucratic. This is largely because their IT systems won’t allow them to be agile, compared to newer entrants into the marketplace. Deep within their software inventory it’s often possible to find applications that are 15, 20, 25 years old or more. These applications have built-up in silos for specific functional purposes, (i.e. sales and accounting). Over time, they’ve been allowed to become so critical to the running of the business, their wholesale replacement would either be too risky, too expensive or both.

They’re slow to respond because they lack the transparency to enable quick decisions and the interfaces can require a niche skill set to access the apposite data. The mishmash of technology is effectively hampering their business performance. In this climate, where the market lifecycle has shortened, engagement with customers has intensified, and the opportunities for consumers to vent their spleen have proliferated, CIOs can’t afford to have information stuck in silos. In this environment, the requirement to modernise is acute.

So which companies are particularly ripe for modernisation? Financial services organisations certainly spring to mind. They perform mission critical functions on a number of competing legacy systems. They generally rely on powerful mainframes to perform secure, high-volume transactions that differentiate the business but they struggle with the proprietary and piecemeal nature in which they have been embedded in the organisation. In many cases, these technologies don’t talk to each other, are resistant to change and more prone to security risks and downtime.

And yet, gaining an integrated view of their systems is more important today than ever before. The FSA mandate that banks offer a ‘single view’ of all account holders in the aftermath of the financial crisis is a case in point. The single view will ensure that banks pay back all deposits, regardless of debts, to their account holders within seven days of a bank default. It will also show when a customer has amassed over £50,000 in one bank, across all bank operations and subsidiaries. Given the size of many banks and the lack of visibility across their systems, this is a colossal undertaking.

The requirement to modernise a company’s IT is also timely from a skills perspective. With baby boomers retiring, CIOs face an impending loss of specialist business software knowledge with the capability to fully understand and maintain a company’s legacy applications. Over the next five to ten years, this group of IT professionals and developers, responsible for bringing the esoteric and now end-of-life technology into the organisation will exit the workforce, leaving critical gaps in legacy development skills. Companies will either be forced to upgrade or left with creaking systems, with no recourse for support and recovery. Add to the mix the risks associated with tampering with an outdated code and it’s clear that businesses that fail to modernise will not only cap any notion of agility, but their inaction will also put them in breach of compliance and their own KPIs.

The decision to modernise is also a human resources issue. IT savvy workers are now taking an active interest in their employer’s IT. According to an independent IDC study, commissioned by Unisys*, 33 percent of respondents wouldn’t accept a job without being guaranteed a fast internet connection and a further 43 percent believe this would make the job more attractive.

Consumers now expect to be able to access their information via a plethora of different devices, e.g. from phones, home PCs etc, which is why they are so regularly disappointed when they enter the workforce. Add to the rub the mismatch between the expectation to work productively and the tools available to them, and it becomes clear that legacy applications are consigning businesses to a spluttering existence, while the rest of the consumer world is taking giant leaps forward.

This innovation lag is all the more worrying in a post-recession economy, as we look to enterprise to carry us out of the downturn. To increase their profitability and productivity in these tough times, businesses must raise the bar of performance, which can only be done through more efficient use technology.

In addressing these challenges, CIOs are increasingly turning to application modernisation – a technology process effective in extending the value of legacy investment through investment in new platforms. It uses a number of techniques to ease the cost, pain and risk of leaving behind an old code base or platform. It also enables companies to continue to benefit from their aging applications, while complying with industry regulation.

Historically, some of the technology enablers for application modernisation have included web tools, service-oriented architectures, business process management tools, open source technologies, and wireless and mobility extensions, to name just a few. Each of these enablers has brought tangible business benefits. However, there are also new, up-and-coming technology enablers, which include social computing, next-generation mobile computing, cloud computing, and software-as-a-service. All of which usher in a new age of collaboration, increased computing power and a richer user experience.

These newer approaches also address the trenchant skills shortage issue. By taking a cloud/hosted approach, a company can effectively shift the burden of maintenance to a third party. By passing the onus of running the technology to a third party, a business can enjoy the benefits of the application without the complication of managing and updating the code.

The modernisation strategy has evolved so businesses can take advantage of a combination of traditional and emerging IT enablers in a tailored fashion, to best meet the needs of the enterprise. Fortunately there are a lot of options open to companies that want to modernise – much fewer for those who don’t. The decision to turn to application modernisation boils down to the following rationale. The average consumer wouldn’t buy a new gadget without a warranty, so why would a large FTSE listed company rely on an application, which is critical to the running of their business, with diminishing opportunity for support and maintenance?

* The Unisys/IDC study of 2,820 workers and 650 global IT decision-makers in 10 countries provided content for a report on ‘A Consumer Revolution in the Enterprise’. Further information can be found here: