Application modernization is an exercise that is fraught with anxiety and trepidation
This is an exclusive interview conducted by the Editor Team of CIO News with Venkataramanan K.B., Global Head IT at Intertrust Group
The need for application modernization is primarily around creating new business value from existing applications. It enables us to adapt to market dynamics while also lowering costs.
From a business user perspective, application modernization is an exercise that is fraught with anxiety and trepidation. So before starting, it is important to define.
What’s the outcome for your business?
- Take a look at where you were five years ago and where you are now.
- There are certain pieces of technology that are absolutely critical for you from an existential perspective, and there are some that have enhanced the quality of your business. Make sure you are able to distinguish them.
- Is there a piece of technology without which your entire business will come to a halt? If so, that is the key business area. Which legacy applications are priorities?
- Next, look at whether this key business area has scaled over the past 5 years. Business is never static—it’s always moving, and therefore processes will also be dynamic. If, however, the application that served this business area was able to adapt earlier with little lag, but now you feel it takes ages for the change to affect the business, this is the main area that needs an application modernization. Legacy applications cannot be modernised with the same approach—they are embedded in your enterprise; use a different methodology for them.
- Choose your applications after careful consideration—it will make the difference between effective and efficient modernization. Each new venture will be fraught with roadblocks; plan for them both in terms of effort and time. Be nimble and fail fast. It allows you to choose the best path for you.
What are the drivers for application modernization?
- Cost of keeping lights on in the data center: As time goes on, the time required for changes to be made in the application to keep it in line with business needs will dramatically increase. This therefore negatively impacts the cost, as more resources and time are required to be responsive to change. As a business leader, you would like to adopt technology that lowers the cost structure to adapt to changes.
- Staff Productivity: Staff turnover will result in implicit knowledge loss; the time required for change in the application will take longer as the incumbent will need to understand history and then proceed. Also, the cost of these changes in terms of errors will always make testing cycles longer.
- Customer experience: The millennial generation thinks differently, and it’s important to stay relevant. The modes of access and expectations are completely different. Address the lack of agility.
- Ability to create something new: Say, a new revenue stream that addresses a latent need of the customers.
Strategies for modernization
- Re-host: This is perhaps one of the easiest and fastest methods. Move from a capital-intensive model to a revenue-based model. You move all your servers to the cloud, but you do not take advantage of any of the actual cloud services except for the ability to provide virtual machines. From a CIO perspective, the downsides are many.
- Some of the key ones are:
- Excessive usage results in high operating costs. Since the cloud model predicates a “pay as you use” model, this cost sometimes becomes extremely high.
- The multiple users’ environment does not lend itself to good security. Since it is based on fractional ownership, there will be efforts to adopt standards that one is not familiar with, leading to a higher risk of security issues.
- Higher downtimes.
- A missed opportunity to improve customer experience and operational efficiencies.
- Re-factoring: The application codebase largely remains the same while it is migrated to cloud infrastructure-as-a-service (IaaS), including cloud-based storage, compute, and network resources. Here we adopt all the goodness of the cloud. Developers can reuse investments in languages, frameworks, and containers, thus leveraging the organization’s strategic code. Refactoring shares most of the drawbacks of the re-host strategy described above.
- Re-architect: The legacy monolithic application is re-architected according to the micro services model, containerizing them and rolling out modern DevOps practices.
- This methodology allows for better granular control and provides benefits such as business agility, faster time to market, reduced costs, and an opportunity to reinvent the customer experience.
- Rebuild: This achieves the most substantial benefits. The first option involves the most fundamental change and delivers the most value. It is very destructive, as it seeks to re-architect the entire application and build it from the ground up.
- Replace: This is when you believe a COTS application that is available is a better way to leapfrog years of inaction.
What can you expect as drivers of ROI?
- Time to adopt the change: Since time is money, it’s only fair that the time taken for this change be used as a driver to measure efficacy.
- Ease of scaling and compressing business: After all, business cycles will have feast and famine cycles, so making sure that costs follow a linear trend is key.
- Cost of capital: This is one of the most important factors in determining the affordability of change.
Issues and challenges
- Organizational Change Management: When changing the platform, any change management is difficult. The key areas to look for are ensuring that the data is clean and that a data cleansing exercise has been done.
- Co-existence of Legacy and New Systems: There will be some time in the organisation when both sets of systems will be live; ensuring data consistency between them is crucial to their success.
- Significant Modernization Costs and Duration: Revisiting old processes to ensure that the non-required ones are removed, rewriting them to reflect the current reality, and ensuring their adoption is a big challenge. A complex legacy system could take years to modernize, and then there’s the risk of encountering unforeseen circumstances in the process.
How do we approach the problem?
- Break down the monolith—think services.
- Abstract applications from infrastructure
- Create context to reduce costs—create a catalogue for various environments—OS versions, deployment flavours, etc.
- Build security into applications.
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