Why Invest in Modernization?

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Application modernization and application portfolio management involve a constant evolution process. Successful organizations incorporate the best technology as the organization moves forward, producing an optimized and streamlined application portfolio. While evaluating modernization options, these organizations typically put more emphasis on meeting the business requirements than technical elegance.

Legacy applications often carry considerable hidden costs as the result of not maintaining the application portfolio:

  • The Business Gap
    • As the IT environment becomes more crowded and more complex, it simultaneously becomes unable to respond in a timely manner to business demand for change and will create an increasing gap between IT responsiveness and business demands.
  • Managing a Complex Portfolio
    • Disparate IT systems create multiple points of failure and are difficult to manage, especially with the various forms of cloud-based services. Integration provides the capability to deliver real value to the business, reduce latency and increase the throughput capacity of the organization. Portfolio complexity leads to substantial additional costs, without any real differentiated benefit from these costs.
      For example, one Fortune 50 client found that, as a result of mergers and acquisitions, it has seven separate help-desks systems in use around the world, each with licensing costs, operation management costs, and maintenance and support costs, thereby substantially increasing the company’s TCO.
  • Technology Obsolescence / Skills Crisis
    • If left unchanged, existing applications will, with time, become obsolete and may reach a stage when they will not be supported by their vendors. Old applications can also pose maintenance challenges due to lack of specialized consultants on obsolete technology.
  • Increased Cost of Transformation
    • Several studies indicate that delaying application modernization initiatives due to cost implication may be a short-sighted decision; cost of modernization projects may increase multifold due to legacy data accumulation which may even threaten enterprise liquidity.

There are a number of reasons why investing in legacy application migration and modernization is a good idea.

  • Optimize ROI
    • Consolidation and modernization of an application portfolio should take place if the goal is to optimize its ROI from any data center consolidation.
    Reduced Cost
    • Industry experts estimate that a code conversion project migrating existing applications costs about 75 percent less than a total re-design/re-write.
  • Less Time
    • The time associated with delivering comparable functionality via code conversion is about 50 percent less than a total re-write.
  • Minimal Impact to End Users
    • Converting legacy applications offers less disruption and minimal impact on end users. The project also does not require dedicated functional experts as do total replacements.
  • Proven Methodology
    • NTT DATA’s methodologies take business drivers and technology risks into consideration when analyzing an application portfolio ensuring the target solution enforces the business drivers and mitigates the identified risks.
  • Experience

Post Date: 11/1/2013

default blog image Henrik Sorensen

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