White Paper Legacy Modernization. Product & Solution. Application Management & Modernization.

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1 White Paper Legacy Modernization. Product & Solution Application Management & Modernization.

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3 Content. 1. Introduction Legacy Modernization Different legacy modernization solutions Comparison of different modernization solutions Additional Information Literature. 10

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5 1. Introduction. 4 5 According to the Gartner s 2012 CIO Survey, Legacy application modernization, upgrade or replacement is still one of the top IT Technology priorities which CIOs are focusing for 2012 through In 2012, 2,336 CIOs representing more than 35 industries participated in this survey. Legacy modernization comes into play when existing legacy applications have properties which are worth preserving. Most of the legacy systems continue to function reliably, are stable, secure and robust in nature. A long history of system maintenance has resulted in stress-hardened code with multi-faceted test and validation capabilities. Due to these properties, organizations continue to trust legacy systems with the running of their missioncritical applications. However, the same history of maintenance that stress-hardened the applications, makes the system brittle and increasingly resistant to change. Legacy applications also suffer from lack of modularity, poor data abstraction and inadequate data modeling capabilities, since the business processes of these applications are only reflected in the source code. In addition, people responsible for maintaining these applications are fast retiring and the operation costs of legacy systems have increased enormously. Thus, organizations have been forced to step out from the legacy world and explore newer, more flexible and agile alternatives. According to a recent Standish Group survey, 85% of the CIOs surveyed do not see the mainframe playing a central or strategic role in their organizations in 5 years time.

6 2. Legacy Modernization. The different challenges and pain-points which the legacy customers have at the moment can be summed up as follows. 1. Business IT alignment: Today, companies need to quickly add new features to their IT products, merge data processing infrastructures and present information in new ways. But, legacy applications become a bottleneck, since their batch cycles are long, their online transaction processing is slow and web integration with modern platforms is poor. Thus, leading to slower application rollouts and longer time to market. 2. Costs (TCO): A mid-sized mainframe may cost $4 million or more, with large mainframes costing many multiples of this. The annual software license fees and operating costs also typically run in the millions of dollars. Thus, companies are questioning whether the TCO of mainframe really justifies the business utility they offer. 3. Skill shortage: Over the years, the programming languages have become object-oriented in nature. Typical legacy languages have failed to achieve considerable relevance on the newer systems such as Wintel or UNIX, and consequently, they were taken off the study plans of universities and institutions. As a result, the number of programmers with the appropriate knowledge on legacy systems is become increasingly less. 4. Databases: The functions and capabilities provided by traditional legacy files systems and hierarchical databases do not meet the new business requirements. They are complex to maintain since a lot of systems use batch and online macros to facilitate access to these databases. 5. Documentation and processes: Legacy systems developed ten to fifteen years ago, do not possess the level of documentation as modern systems nowadays. Business logic is only known to the experts who were involved in the development of these systems and is often not documented at all. Complex requirements are integrated into the application without documenting the impact on system environment. Thus, it is difficult to plan an easy transition or migration of these systems. 2.1 Different legacy modernization solutions Customers feel locked-in. The legacy ecosystem has changed little in the last 40 years, since it was first introduced by IBM and its peers and designed for business use. Many legacy customers are concerned about their reliance on the IBM mainframe because they feel that they cannot get rid of these complex systems even when they want to and are not aware of the different alternatives available. There are two primary approaches to legacy modernization (Figure 1): Legacy Modernization Solution Tree. Legacy Modernization Complete Replacement Partial Retention Replace by individual software Replace by standard software Rehosting Component Modernization Automated conversion Migrate to SAP landscape Platform shift and version lift Offloading development Manual Rewriting Migrate to the best of breed Improving UI Updating database Fig. 1.

7 6 7 Complete replacement of legacy application Complete replacement of the legacy code can be carried out either by replacing legacy with a standard software or by rewriting the source code manually or automatically. There are a host of standard softwares which can perform common functions such as enterprise resource planning, human resource or customer relationship management available in the market. When organizations use legacy systems to perform such common functions, then they can purchase and customize these standard solutions to meet their vertical business needs. Common examples are SAP, Siebel or open system based software solutions. On the other hand, organizations can also rewrite their mainframe applications in a new language manually or by using converter tools. This rewriting option involve the migration of database and platform along with the application language. Partial retention of legacy application Companies also have the option to retain their legacy code and modernize only part of the architecture or rehost. Companies can opt either for only migrating their database (hierarchical to relational), modernize their user interface or migrate away from the mainframe operating system. The process of migrating away from the mainframe platform but retaining the application is called as rehosting. Under rehosting, the application components are transferred to the new platform such as Wintel using compatible software stack using the Lift and Shift approach. Using this approach, the databases are lifted from z/os based versions to versions which are compatible on the new platform and the platform is shifted from for mainframe to windows or open systems based operating The source code is not altered and the same code is compiled in the new environment after some minor conversions, is tested and the application is deployed. Legacy Migration Alternatives. 2.2 Comparison of different modernization solutions The complete replacement approach do not retain any part of the legacy code and involve complete migration (language, database and platform), they are complex and carry the highest risk of failure. Replicating business logic built up over years, often by people no longer working on the project, leads up to this high investments and long migration durations (Figure 2). These approaches also end up not replicating the business logic and put unique competitive advantage at risk, as the systems are compromised by a one-size-fits-all approach. In these cases, the required functionality may eventually be available but only after significant customization and professional services have been used up. Thus, the Return on Investment (ROI) takes years to come by. Even firms that want to get rid of the legacy code initially begin with rehosting alternative since they are shorter in duration, lower in costs and have smaller associated risks and complexity (Figure 2). The performance efficiency of the existing developers increases remarkably under the rehosting solution. Since, this option provides user friendly and sophisticated code debugging and application analysis functions. But, since legacy developers are very much needed in future mode of operations, the rehosting option does not provide the needed flexibility in terms of the skill set. Automated conversions more often than not result in an ugly looking code, which is difficult to understand and change. The focus of automated conversions is quick, error free compilation of the new code and less attention is paid to match existing business functionality or to develop new one. In addition, automatic conversion process is seldom 100 percent tool-based, as there are always some application components such as low level languages e.g. Assembler which are not supported by the converter tools and have to be written manually. Manually rewriting the source code option provides for higher benefits than automated conversions as the rewritten code matches the business requirements more closely, is easier to maintain and enhance later on. Another benefit for manual rewriting is the reduction in dependency on the legacy developers in the future mode of operations. Duration of migration Migration complexity Investment Resource flexibility Risks Automated conversion Manual conversion Rehosting Replacement by software Component modernization Fig. 2.

8 3. Additional Information. Legacy Modernization is an integral part of T-Systems Application Management and Modernization (AMM) portfolio. T-Systems has a standard methodology for implementing legacy modernization projects which spans over five phases (Figure 3). During the pre-assessment and assessment phases, T-Systems uses its pre-assessment questionnaire and a set of legacy assessment tools to understand the dependencies and rate the complexity of each application. During the define FMO Blueprint phase, the migration roadmap and business case for the project is created. In the last two phases, the project plan is put together and application performance is base-lined to begin with the migration of applications. T-Systems is Deutsche Telekom s corporate customer arm. Using a global infrastructure of data centers and networks, T-Systems operates information and communication technology (ICT) systems for multinational corporations and public sector institutions. With offices in over 20 countries and global delivery capabilities, T-Systems serves companies in all industries from the automotive industry to telecommunications, the financial sector, retail, services, media, energy, and the manufacturing industry all the way to government agencies and the healthcare sector. Approximately 48,200 employees worldwide use their industry expertise and ICT know-how to provide topquality service. T-Systems generated revenue of around EUR 9.2 billion in the 2011 financial year. Legacy Modernization Methodology. Program management Pre-Assessment Assessment Define FMO Blueprint Project Planning Transformation Activities Activities Activities Activities Activities Overview CMO Initial Assessment Business IT Solution Workshop Gather and evaluate req. Business IT Develop specifications Detailed Assessment Design solution architecture Complete Replacement Partial Retention Draft Business Case Analyze dependencies Sequencing of activities Define flagship projects Define timelines Migrate Data, Inventory (Manual/Tool based Enhancement Test and Compare Deployment Tools Tools Tools Tools Tools Initial Assessment Questionnaire Assessment Tools Business Case Estimator PM Book Migration and Enhancement Tools Deliverables Deliverables Deliverables Deliverables Deliverables Legacy Modernization Roadmap Complete Req. Documentation Application Assessment Report FMO Blueprint Future architecture Rough effort estimation (timeline, costs) Project plan Timeline Costs Efforts Milestones Modernized Application in production mode Application documentation Fig. 3.

9 4. Literature. 8 9 Source Document [Jan-Martin, Lowendahl] The Gartner Higher Education CIO Agenda Survey Cut: A Look at Industry Characteristics and Learning Opportunities Mastering, [The Standish Group] IBM Mainframe Modernization Survey, [Dillow David, Regan Kathleen, Pierce Russ, Mainframe Migration Partner Solution Guide, Pradhan Parag, Miller Michael] [Murphy, Phil] Mainframe Migration Panacea Or Pandora s Box? Forrester, April Fig.-Nr. Figure Name Figure 1: Figure 2: Figure 3: Legacy Modernization Solution Tree. Legacy Migration Alternatives. Legacy Modernization Methodology.

10 About the Expert Ankit Gupta is a project manager within the Global Competence Center (GCC) for Application Management & Modernization (AMM). He is part of the AMM Advisory practice and provides consulting for topics such as IT-Strategy, sourcing, operational excellence besides managing global application migration projects. His experience includes, offshore coordination and program management for service management and legacy modernization projects with revenues between 3-5 million and team size between members. He also has been driving the legacy modernization and Application Performance Management (APM) initiatives within the GCC s modernization program. In the last nine months, he has provided technical consulting in modernization topics for multiple RFIs, RFPs and implemented performance solutions for numerous customer service projects. The GCC AMM is a multinational team of more than 30 consultants and project managers who specialize in the implementation of critical application outsourcing projects. Big AMM deals are accompanied from Lead to FMO above all branches, technologies and countries. This Expert Paper is published within the Experts on Application Management & Modernization column. For more information go to:

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12 Published by: T-Systems International GmbH Hahnstr. 43d Frankfurt am Main Responsible for content: Product Marketing APM August 2012 RecySatin, halbmatt gestrichen weiß Bilderdruck, mindestens aus 80 % Sekundärfasern, Rest aus holzfreien Primärfasern. Kontakt: T-Systems International GmbH Holger Wächtershäuser Market Intelligence Hahnstraße 43d Frankfurt am Main Holger.Waechtershaeuser@t-systems.com T-Systems International GmbH Günter Hüttig ICT Solution Marketing Otto-Röhm-Straße 71c Darmstadt Guenter.Huettig@t-systems.com T-Systems International GmbH Ankit Gupta Global Competence Center Application Management & Modernization Fasanenweg Leinfelden-Echterdingen amm.coe@t-systems.com