Customer-centric legacy transformation: foremost on CIO's agenda
Creating 'a modern image' for your legacy systems...
Business demands for 'up-to-date' systems is putting tremendous pressure on IT departments to keep up with the pace. This poses a huge strain on companies that are still executing most of their major processes of legacy applications.
With the widening divergence between the IT infrastructure demanded by emerging business needs and the infrastructure they've built up over generations, organisations now require their CIOs to bring more out-of-the-box approaches to transform the current technology landscape by selecting a quick refresh route for their legacy applications and hardware systems which have reached their end of life.
However, this is easier said than done. The risks are great in transitioning from outdated applications and systems to newer models. This problem gets progressively more complex when you factor in the cost pressures organisations are facing due to the current economic climate. It is often an intricate, high-risk exercise despite increasing the pressure on IT executives to deliver solutions that are agile and cost-effective, while enhancing the total customer experience. According to financial services analyst Tower Group, obsolete technologies often survive because of the risk and cost of replacing them.
Legacy replacement projects can fail, not only damaging the credibility of the IT department but also the careers of the managers put in charge of them. The time and cost involved in system testing and the prospect of a massive end-user retraining programme can prove overwhelming as well. The risk of losing IP that has taken decades of investments looms high in such "rip-and-replace" transformation exercises.
With integration still ranking as one of the prevailing challenges, additional hurdles include the difference in transaction patterns which tend to create compatibility issues. Added to this is the probability that the legacy systems can consume more network bandwidth than their modern counterparts, owing to the serial nature of their output.
The lack of skills and the aging of available skills are a few of the growing concerns; there is a definite skills shortage on the legacy side as most of the developers have moved on to newer technologies and the few who remain in the legacy environments are aging.
The decision to start afresh might at first sight seems understandable, especially to the younger technocrats and business customers accustomed to user-friendly customer applications. Further to this is the fact that cloud, mobile and other new lightweight, less costly technologies are fast evolving and proving to be better options to the organisation.
Most technology experts agree there is no easy plan for deciding when to transition to these newer models which may represent a significant financial investment and still be the only systems handling critical business transactions. The evaluation process is typically much more complex, requiring, among others, a comprehensive understanding of where the organisation is heading (its strategic direction), and whether the current systems can be used to automate workflows and produce the same process efficiencies that newer systems enable; and whether the system can support the industry's growing need for business intelligence and analytics.
Despite the IT industry's efforts to improve the standard of technology adaption used in the enterprise, a significant number of users choose to stick with apparently outmoded technologies for some of their most critical applications.
Most customers in financial services domain have a large footprint of applications that run off legacy environment, which caters to more than 60% of their core operations. Most of these applications are home-grown and have immense amount of intellectual property locked in them. These systems also form part of their core day-to-day operations, supporting most of the back-office processing and are key to the company's performance and time to market.
The reasoning is not always apparent, as there might still be a valid business case for legacy systems; for example, several banks depend on core systems developed in the 1970s and 1980s. Each time a banking customer does a money transfer, the transaction generally passes through a series of legacy platforms.
Mainframe manufacturers claim operating systems are living longer than they did in the 1970s, and only a handful have been terminated. Unisys has extended the length of support for its operating system releases, and put new policies in place so customers do not have to keep moving from one version to another. The company is not alone in keeping its legacy systems alive. The IBM mainframe has evolved to the modern zSeries, and the AS/400 to the equally up-to-date iSeries; even then it is difficult to generalise about legacy operating systems at the best of times.
There is definite merit in sticking with your legacy systems if you can find the ideal model to manage it. Having said that, the following are a few key challenges that customers face in sticking to their existing legacy landscape:
* Revenue losses - Legacy systems are green-screen-based with dimension restrictions; on a daily basis the operators are required to traverse many screens in order to achieve a task and manually type inputs to the screens. This always leads to many finger errors, which in turn lead to revenue losses.
* Operational efficiencies - Large amounts of transaction volumes on the systems; it has become necessary to reduce the time per transaction and increase operational efficiencies.
* Integration to other systems - Given the complex nature of legacy systems, there has been no integration to other business systems and the banks have identified the need for such integrations.
* Reporting requirements - There has been a pressing need for simple and real-time reporting in terms of exception tracking and day-to-day management of transaction volumes.
* Workflow automation - Given the high volumes of complex transactions that pass through the legacy applications, there is always a need for workflow automation to gain increased operational control.
* User experience - The back-office teams, which are generally the predominant users of legacy environments, are always in need of better user interfaces that can provide a more interactive user experience there by reducing time per transaction.
Hence, the ideal model is one that does not require any rewriting of your legacy system or major conversions of these systems, while still providing you the benefit of cloud, Web, mobility, integration and, most importantly, a single view of your customer.
You will find this ideal model in In4Group's Enterprise Transformation Model (ETM). The LegaSuite and Data Virtualization Server product lines represent the most comprehensive platform of legacy liberation technologies available today for enterprise computing. Helping companies maximise use of these product lines to achieve their legacy modernisation goals is why In4Group created ETM.
In4Group's ETM is based on a body of experience in liberating legacy systems that spans more than 15 years. Its professional services department has learned the many nuances involved with integrating business-critical legacy application assets into contemporary SOA; however, subtle changes to legacy systems can cause ripple effects to operations throughout your enterprise. ETM addresses this challenge by offering a phased approach to implementing the best practices supported by an extensive knowledge base of proven tools, techniques and case studies.
In4Group's ETM speeds time-to-solution through a framework of phases. Each phase comprises stages, which consist of detailed tasks and steps that produce defined deliverables. In4Group's approach to legacy technology embraces the concepts of agile and extreme programming that bring functional, technical and testing teams together within a joint development environment. ETM provides a laser focus for prototyping, communication, simplicity and feedback that speeds the liberation of legacy applications, enabling creation of the correct solution for the correct project at the correct time, thereby maximising your benefits.
The concepts utilised in ETM also aid your project teams by explaining the fundamental principles of legacy liberation as next generation - underscoring substantial advantages provided over traditional build-from-scratch methods.