IT Management

This year’s IT budgets are forcefully framed by the worldwide adverse economical climate. Cost-cutting and a sharpened focus on ROI are the key drivers that shape these budgets. It’s universal wisdom that most budget reduction activities will weaken IT organizations and temporarily impact their ability to service the full spectrum of enterprise computing needs. However, not every budget reduction activity will have such a negative impact. In this context, legacy modernization projects can be viewed as proactive, strategic initiatives that, while reducing immediate operating costs, will ultimately produce more agile, streamlined application portfolios. These new generations of modernized application portfolios will be better aligned with enterprise business needs and more responsive to future enterprise growth once the economy recovers.

Historical Context

To better understand the historical context of legacy modernization initiatives, let’s begin by taking a quick walk down the enterprise IT computing memory lane. In the dawn of IT computing, the ’70s and ’80s were solidly dominated by increasingly powerful mainframe computers. The late ’80s and the early ’90s brought us user-friendly Graphical User Interfaces (GUIs) and the flexibility of relational databases and client/server computing. At the turn of the 21st century, these were rapidly superseded by the Internet and e-business networks. These most recently started to evolve into ubiquitous computing paradigms of Wi-Fi and Bluetooth technologies, as well as the rapid ascent of smartphone platforms.

The evolution of IT architectures was further accelerated by the rapid convergence of technology and business needs. Classical IT systems were initially focused on automation, cost control, and operational efficiencies for existing business processes. Over time, these systems evolved into critical success factors in enterprise value creation and served as the driving force that reshaped the core of 26enterprise business models.

An interesting phenomenon happened during this evolutionary process. Instead of replacing its obsolete predecessors, each successive generation of IT technologies simply augmented the existing portfolio of enterprise applications, creating a curious mix of old and new architectures that are working together in unplanned ways. It’s now commonplace for modern IT shops to simultaneously run semi-integrated mainframes, client/servers, and Web 2.0 applications that are both supporting and impeding evolving business models and corporate progress. The fact that the old IT systems never fully gave way to modern architectures and the associated complexities that resulted from this is known as the legacy dilemma.

The Legacy Dilemma

A frequently heard opinion from IT executives is that significant parts of their legacy application portfolios have difficulty supporting changing business needs. In fact, many legacy systems have developed such a rigid, complex internal structure that it’s risky to modify them in a way that goes beyond the most basic, tactical changes.

The immediate reaction to this situation is clear—legacy systems need to be rapidly replaced with the latest technological advances based on a solid architectural foundation and seamlessly integrated into existing application portfolios. In practical reality, the process of legacy obsolescence is impeded by two basic factors—time and money. The sheer size and complexity of existing legacy application portfolios make it impossible to simply retire these portfolios and replace them with totally new, groundup initiatives.

So we face the legacy dilemma that can be crisply stated as: “The objective reality of legacy systems is that the only plausible way to lift the economical burden of these systems is through the practical imperative to leverage the business value that’s already built into these systems.”

In plain English, legacy modernization initiatives are about reducing the costs associated with maintaining or replacing legacy systems by leveraging the residual investment that the enterprises already accumulated in the same systems.

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