In today’s cloud-native mobile world, organizations with legacy IT systems are at great risk of falling behind. While the economic climate now may tempt CIOs to pause their modernization plans for short-term efficiencies, it is unwise to do so. Growth-oriented companies know that now is a good time to invest in solutions to be closer to the customer while becoming more agile and future-proof. In view of the rapid technological development, innovations are now more important than ever to stay one step ahead of the competition. However, IT modernization is often labor intensive and complex, so a well thought-out strategy and implementation plan are critical to the results to be achieved.

Increasing pressure

Consumers are now more digitally savvy than ever as they are increasingly exposed to everything from e-commerce to work-from-home apps to remote healthcare during the pandemic. As a result, they have also become more demanding and have higher expectations of any digital experience. Rapid anticipation of these changing requirements is an important key to business success in the years to come. For many organizations, this means modernizing legacy IT systems that they have relied on for decades and which have now become a bottleneck to their agility.

In times of increasing economic pressure, investments in modernization are of course a challenge. Gartner found that CIOs in EMEA expect their budgets to increase by an average of 4.4%, below current inflation. This limits their ability to invest more in modernization and increases the pressure to do more with less. As CIOs are always looking for the solution to dilemmas, it’s important to recognize that there are major drawbacks to platforms built for the cloud age. It’s expensive to maintain, more prone to issues that can lead to unexpected expenses, and harder to update with the features needed to grow efficiently. However, successful modernization leads to significant cost savings.

basis for modernization

One of the main reasons modernization projects fail and their costs are disappointing is that companies don’t start on a solid foundation. Their legacy IT systems were often built over decades through a mix of organic growth and acquisitions. This evolution leads to a mishmash of systems and applications designed to different standards and based on different frameworks. Only then does modernization projects reveal that organizations do not have the knowledge, skills or insight to manage the complexity and successfully complete their initiatives.

The required knowledge, skills and insight is one of the many reasons why it is important to find the right transformation partner upfront. An experienced and trusted professional who can use their expertise in planning and execution. With the right partner on board, a company can then develop a future-proof IT modernization plan. With a great deal of complexity typically built up over decades, it can even be difficult to know where to begin. It is therefore worth dividing projects into manageable phases and steps.

Three steps to success

The first and perhaps most important step in any modernization project is to first map out the existing IT infrastructure to understand how the systems are built. This can be effectively accomplished with an intuitive-to-use automated discovery tool that gives organizations clear visibility into their technology stack. IT teams need visibility into all application layers and dependencies with a high level of granularity. The key is to use this process to identify and decide which applications need to be modernized, which are technically obsolete, and which are obsolete. The latter category should be phased out to reduce complexity and cost.

The first step flows seamlessly into the second step: identifying where modernization can provide the most value. For example, a shorter software delivery cycle to accelerate time to market and increase efficiency, or a migration to a modern database that allows easier access to business insights to drive sustainable growth. Organizations shouldn’t want to modernize everything right away. Instead, business cases must be designed to ensure projects are carried out for the right reasons. IT modernization can be time-consuming and expensive, and this is not the time for wasted projects.

The third and final step is to launch a transformation project driven by a high level of automation using a platform-based approach. In fact, automation is essential to any IT modernization project. Legacy environments can be so complex that tens of thousands of parameters need to be updated, which is difficult for humans to do. A platform-based approach helps accelerate and streamline modernization projects, providing a standardized and automated approach across all project phases. From decoupling used applications to redesigning to refactoring and optimization – all with minimal risk of business disruption.

Begin the journey

When organizations can successfully complete these three steps, they simultaneously lay the foundation for accelerating the next modernization projects and digital transformations. This enables them to improve operational excellence and the customer experience, giving them a lasting competitive advantage. There is no better time than now to tackle the necessary IT modernization.

This is a contribution from Milan Bhatt, President and Global Head – Modernization & Healthcare & Insurance at Hexaware. Click here to learn more about the company’s solutions.