74% of organisations fail to complete legacy system modernisation projects, new report from Advanced reveals

Nearly three quarters of organisations (74%) have started a legacy system modernisation project but failed to complete it. This is according to new global research from Advanced, which suggests one of the largest obstacles to a successful modernisation project is a disconnect of priorities between technical and leadership teams.

The IT services provider’s 2020 Mainframe Modernisation Business Barometer surveyed business and technology employees working for large enterprises with a minimum annual turnover of $1 billion across Europe and the United States. The report explores trends within the mainframe market, the challenges organisations face, and the case for application modernisation among large enterprises across the globe.

With a lack of success or progress in a large number of legacy system modernisation projects, the report also suggests a disconnect between business and technical teams could be to blame. In fact, the primary motivations behind pursuing modernisation initiatives varies between those with more business-focused versus technical job roles – as does their chances of success when securing funding for these projects.

The research finds that CIOs and Heads of IT are more interested in the technology landscape of their organisation as a whole, whereas Enterprise Architects are more internally focused. More than two-thirds (69%) of Enterprise Architects cite hardware dependency and other technical influences as the primary reason to modernise whereas CIOs and Heads of IT cite business competitiveness (66%), security (58%) and integration (54%).

 Despite the apparent business benefits of modernising, there is a significant disconnect between the desire for technical teams to pursue these projects and the level of commitment they receive from broader leadership teams:

  • Only 12% of Application and Infrastructure Managers report receiving full funding commitment from leadership teams for modernisation projects – and 56% say this failure to get funding is driven by fear of change.

  • More than half (53%) of CIOs and 42% of CFOs get full funding commitments from senior leadership. It suggests that, in order to move forward with these initiatives, technical team members need to substantiate the business case better for these efforts using terms that the broader business team can understand.

 

“Collaboration is absolutely essential to successful modernisation,” said Brandon Edenfield, Managing Director of Application Modernisation at Advanced. “To achieve this, technical teams must ensure that senior leadership see the value and broader business impact of these efforts in terms they can understand. Without full commitment and buy-in from the C-Suite, these projects run the risk of complete failure.”

 

Looking to the Cloud

Despite differences in their motivations for modernisation, most respondents agreed on the value of the Cloud in modernisation. In fact, 98% of those surveyed reported active plans to move legacy applications to the Cloud in 2020. This push is likely driven by key benefits such as enhanced business agility and flexibility as well as the opportunity to attract new generations entering the workforce who expect advanced technologies. Above all, it offers significant cost savings for IT infrastructures. In fact, organisations could save around $31 million if they modernise the most urgent aspects of their legacy systems.

Brandon continued: “As our world grows increasingly connected, organisations need to get more serious about modernisation. If organisations are to adapt to market changes and remain competitive, organisations need to consider legacy modernisation as the foundation and starting point of their overall digital transformation efforts. Those who fail to prioritise this shift risk falling behind their competition and significant revenue loss in the future.”

To view the full report, please visit: oneadvanced.com/Modernisation2020

 

 

Research Methodology

The 2020 Global Application Modernisation Business Barometer Report was carried out online by Coleman Parkes throughout March and April 2020. The sample comprised of 400 people working for large enterprises in Europe and the U.S. with a minimum annual turnover of US $1 billion.

 

 

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