Johannesburg, 15 May 2020
Two years ago, South African businesses were looking to retire their legacy applications. Today, in a major turnaround that started prior to the COVID-19 pandemic, businesses are prioritising modernising their existing investments, bringing COBOL into the 21st century.
There’s been a recent spike in interest around COBOL, spawning conversations about the availability of skilled COBOL programmers, spurred by the global pandemic and the demands it’s placed on IT systems.
Derek Britton, Product Director at Micro Focus, says: “COBOL rarely makes news headlines because it’s stable, reliable and does what it needs to, so in this instance it’s very much a case of no news is good news. However, because of this, many people don’t realise the vital role that COBOL plays in the global economy, or how well it has evolved to continue as the bedrock of big business.”
In 2020, COBOL entered its 61 year of successful usage. For any technology to have survived and been successful for six decades is nothing short of phenomenal, says Britton. The reason COBOL has stood the test of time was investigated in a survey conducted by Micro Focus and Vanson Bourne earlier this year.
“The survey aimed to uncover the story behind COBOL, as well as what it’s being used for in organisations around the world, and some interesting points came to the fore from the South African region. The intention was to explore investments that organisations had made in COBOL systems as well as how current, topical and strategic those systems remained today. In South Africa alone, a staggering 100% of respondents viewed COBOL applications as strategic to their organisation, compared to 92% globally. ”
In order to move forward with COBOL applications, organisations have to embark on a modernisation strategy as a vehicle for IT transformation and critical business change. “72% of organisations globally see modernisation as a viable strategy to support business change, whereas in South Africa, 95% regarded modernisation as a viable strategy. It’s encouraging to see that businesses regard COBOL as strategically important instead of removing it and replacing it with something else.”
A range of factors affect the pace at which organisations intend to move forward with modernisation. Globally, 64% of businesses were looking to modernise key COBOL applications in 2020. By contrast, in South Africa, 90% said they were planning to modernise their key applications this year. “Seen against the background of the global figures, the local numbers can be seen as positive and proactive, perhaps reflecting the importance of COBOL systems to the businesses. There’s certainly a stronger appetite for protecting, growing and enhancing core business systems in this region.”
Gary de Menezes, Managing Director of Micro Focus South Africa, adds that this trend is particularly evident in the financial services, retail and manufacturing spaces locally. “The current pandemic – and with South Africa being under stricter lockdown rules than most countries in world – has driven an increasing number of companies to move towards some form of automation. Employees are struggling to work from home, businesses are struggling to be effective, and every single organisation is looking for different and better ways of doing things.”
This trend isn’t going to come to an end when lockdown is over, he cautions. In South Africa, corporates have had to quickly adopt a new way of working and have been forced to break old habits in favour of new ways of doing business. They’ve found themselves having to implement changes a lot faster in order to remain competitive as businesses are being forced to find new ways to keep revenue streams up.
“We’re seeing an urgency to move to the next step by businesses unsure what to do next. The challenge is that most corporates rely heavily on face-to-face meetings, now they have to go virtual, and not everybody is willing or able to adapt. Naturally, such challenges present a massive opportunity in the COBOL space, with increased demand for aggressive modernisation initiatives."
“While the survey took place pre-COVID-19, the results are very relevant to the world in which we find ourselves today,” says Britton. “For example, 42% of companies said they were looking to deploy their COBOL systems into cloud-based technology.”
He says it’s significant that the percentage of cloud-bound companies is almost at the halfway mark as IT flexibility, efficiency and automation are becoming essential, and it’ll be interesting to see where COBOL fits into a more agile approach to change. “74% of respondents had some form of DevOps and test automation process in place when delivering COBOL systems, which is reflective of an aspiration to change faster and more efficiently.”
One of the direct impacts of the pandemic is that employees can’t go into their workplace to log into tools and servers they require to do their day job. Companies need to find alternative ways of enabling their workforce to do that, decoupling them from structured, regimented logins from a specific desktop device. While this is becoming the new normal, it can prove challenging for larger organisations.
Another interesting fact that emerged from the survey was around COBOL’s ease of use. In the South African region, 90% of respondents said it was an easy technology to use. So while a lack of programming skills is often mentioned in the local context, this does shine a light at the end of the tunnel, says De Menezes. “A Facebook COBOL programmers’ group has grown 55% in 18 months, so there is an emerging community of COBOL talent available, many of whom are in the 25- to 35-year-old age range, belying the stereotypical view of aged and dusty COBOL programmers. This speaks to the enduring popularity of the technology, correcting claims that it’s outdated and legacy.”
De Menezes adds: “The opening of data centres on South African soil is making it more viable for organisations to consider moving key applications to the cloud. Where previously there may have been reservations about putting certain applications and data into the cloud, the advent of local data centres makes cloud more accessible and feasible. The latency issues often associated with data centres located in Europe and elsewhere are no longer a problem, possibly proving the final catalyst needed in the South Africa market, as reflected in the high percentage of local businesses that say they’re planning their cloud strategy.”
De Menezes concludes by saying it’s interesting to see that after many years of trying to rip and replace legacy applications, the accepted approach has become modernisation, and within a relatively short time frame.”
Download a webinar that further unpacks the results of the 2020 COBOL market survey here.