Thank you for joining us for this 10-part series to discuss the Top 10 Ways You can Save on your Mainframe Costs in 2023.
- Nearly all Clients are Clamoring for Savings in 2023. This is largely due to (a) rising input costs, (b) softening business forecasts, and (c) continued economic uncertainty and headwinds. This has caused many clients to re-evaluate spending plans and implement new cost-cutting targets.
- IT is the Number One Cost Savings Category of The Modern Enterprise. IT is typically the highest indirect spend area for modern enterprises and is also the cost category with the highest potential savings yield (we average about 33% savings on addressable IT spend). In addition, since 2020, clients have largely exhausted conventional cost savings countermeasures such as canceled projects, delayed spending plans, and cuts in discretionary spending, and many have even gone through Reductions in Forces (RIFs), and/or even facility closures. As a result, clients are at risk of cutting muscle and bone this year as cost reduction demands persist, but desperate measures are not necessary when we can help you harvest considerable value from your mainframe supply chain, do so with minimal risk, and perhaps even get additional value including modernization and digital transformation among other benefits.
- NET(net) is the Number One IT Cost and Value Optimization Provider. In the last 20 years, we have shaped over $2 Trillion of investment, captured well over $400 Billion of incremental value for our clients and partners, and have an 85% probability of achieving savings ranging between 13-53%. Our performance numbers are simply unmatched.
When it comes to Mainframes, NET(net) sees incredible savings opportunities in 2023. Not since 2008 has there been as much downward pricing pressure on technology incumbents, and we believe meaningful savings targets can be achieved, but due to the market conditions, technology incumbent suppliers are seeking to increase prices and will be highly disruptive to any cost savings agenda, so it will require a commitment to do the hard work to realize meaningful reductions.
With that as a backdrop, we give you our Top 10 Ways You can Save on your Mainframe Costs in 2023.
In case you missed our previous installments, look back at our previous posts:
- Part 0 (Feb 1): Price Benchmark Your Mainframe Costs
- Part 1 (Mar 1): Optimize Mainframe Licensing
- Part 2 (Apr 1): Minimizing MIPS (Millions of Instructions Per Second)
- Part 3 (May 1): Optimizing MLCs (Monthly License Charges)
- Part 4 (Jun 1): Upgrading Your Operating Environment
- Part 5 (Jul 1): Optimizing Mainframe Maintenance & Support Services
- Part 6 (Aug 1): Outsourcing Mainframe Support
Part #7 of 10: Modernizing Mainframe Applications
Modernizing Mainframe Applications – can help you save money on mainframe costs. You may be running mainframe applications that were written decades ago. Their code can be modernized to run more efficiently by taking advantage of modern mainframe hardware, running more tasks in parallel and so on. Modernizing mainframe applications can provide a wide range of direct savings and benefits. By modernizing mainframe applications, client organizations can improve their bottom line and position themselves for future success. Here are some details about these benefits:
- Reduced operating costs: Modernizing mainframe applications can reduce operating costs by making them more efficient and scalable. For example, by moving applications to the cloud, businesses can save on hardware and software costs. They can also save on energy costs by running their applications on more efficient cloud infrastructure.
- Improved time to market: Modernizing mainframe applications can improve time to market by making them easier to develop and maintain. This can be done by using modern tools and techniques, such as automated testing and CI/CD. These tools can help businesses to automate the testing and deployment of their applications, which can speed up the development process.
- Increased revenue: Modernizing mainframe applications can increase revenue by making them more user-friendly and responsive. For example, by migrating mainframe applications to a web-based platform, businesses can make the data accessible to a wider range of users. They can also make their applications more responsive by using modern technologies, such as caching and load balancing.
- Improved customer satisfaction: Modernizing mainframe applications can improve customer satisfaction by making them more reliable and secure. For example, by migrating mainframe applications to the cloud, businesses can make them more resistant to downtime and data loss. They can also make their applications more secure by using modern security features, such as encryption and authentication.
- Reduced risk of obsolescence: Modernizing mainframe applications can reduce the risk of obsolescence by making them compatible with newer technologies. For example, by refactoring mainframe applications to use modern programming languages, businesses can make them easier to maintain and update. They can also make their applications compatible with newer platforms, such as those for mobile devices and cloud computing.
- Improved compliance: Modernizing mainframe applications can help businesses to comply with regulations, such as those related to data privacy and security. For example, by migrating mainframe applications to the cloud, businesses can make them compliant with the latest security standards. They can also make their applications compliant with regulations by using modern security features, such as encryption and authentication.
Code refactoring doesn’t necessarily require an expensive, manual, and time-consuming overhaul of the codebase, rather, it’s possible to refactor mainframe software without rewriting it. The following suppliers offer automated solutions for mainframe code refactoring:
- Micro Focus (formerly HPE; now OpenText)
- CSC (now DXC Technology)
- Compuware (now BMC)
- Kyndryl (formerly IBM)
- ASG Technologies (now Rocket Software)
- Synchrony Systems
- GT Software
These suppliers provide tools and services that help client organizations modernize their mainframe applications and automate the refactoring process. Their offerings typically include code analysis and optimization tools, as well as migration and conversion services. It is important to research and compare the offerings of different suppliers to determine which one best meets your specific needs and requirements.
If you are a DIY’er, and you are looking merely for the tools, and you believe you have the people and skills to do the refactoring yourself, you may want to consider:
- Micro Focus Code Analyzer
- Rational Software Architect
- Code Refinery
- Parasoft C++test
In addition to these direct savings, modernizing mainframe applications can also lead to indirect savings and benefits such as:
- Improved performance: Modernizing mainframe applications can improve their performance by making them more efficient and scalable. This can lead to faster response times, improved throughput, and reduced latency.
- Increased agility: Modernizing mainframe applications can make them more agile and adaptable to change. This can be done by making them easier to maintain and update, and by making them more portable to new platforms.
- Enhanced security: Modernizing mainframe applications can improve their security by making them compliant with new security standards and by making them more resistant to cyberattacks.
- Reduced risk: Modernizing mainframe applications can reduce the risk of downtime and data loss. This can be done by making them more reliable and by making them easier to backup and restore.
- Improved compliance: Modernizing mainframe applications can help businesses to comply with regulations, such as those related to data privacy and security.
- Enhanced user experience: Modernizing mainframe applications can improve the user experience by making them more user-friendly and responsive. This can be done by using modern technologies, such as graphical user interfaces (GUIs) and web applications.
- Improved developer productivity: Modernizing mainframe applications can improve developer productivity by making them easier to develop and maintain. This can be done by using modern tools and techniques, such as automated testing and continuous integration/continuous delivery (CI/CD).
Overall, mainframe modernization and code refactoring can provide a wide range of benefits, both direct and indirect. By modernizing mainframe applications, client organizations can improve their performance, agility, security, compliance, user experience, and developer productivity in addition to their bottom lines.
Mainframe application modernization is an important way to save money and improve the performance and efficiency of mainframes. Code refactoring is a key part of mainframe application modernization. There are many suppliers that offer automated code refactoring solutions. By choosing the right supplier and solution, client organizations can save money and improve the performance and efficiency of their mainframe applications.
Examples of successful mainframe application modernization projects. There are many examples of successful mainframe application modernization projects. Here are just three:
- Bank of America: Bank of America modernized its mainframe applications to improve performance and reduce costs. The project saved the bank an estimated $1 billion.
- General Electric: General Electric modernized its mainframe applications to improve security and compliance of the company’s mainframe applications which were outdated and vulnerable to cyberattacks. The project helped the company to avoid a data breach that could have cost untold millions. Although the specific cost avoidance is not publicly known, according to the Ponemon Institute, the average cost of a data breach is $3.92 million.
- United Airlines: United Airlines modernized its mainframe applications to improve scalability and availability. The project helped the company to avoid flight cancellations and delays. While the specific savings are difficult to measure, the average cost of a flight cancellation is $4,000 per passenger, and $1,500 per passenger for flight delays. With 5,000 flights per day, and nearly 150 passengers per flight on United Airlines according to Statistica, even a 10% improvement could have saved tens of millions of dollars per year.
How Much Can You Save?
By working closely with NET(net) to implement these and other savings strategies as part of our Top 10 Ways to Save on Mainframes, client organizations can reduce their mainframe costs significantly and better align their spending with their actual usage, resulting in a more cost-effective mainframe environment.
- Clients fully committed to mainframe modernization efforts can save 80-90%.
- Clients who are committed to a Mainframe Cost Optimization (MCO) initiative (including workload migrations), but who have limited ability to move applications off the mainframe can still see savings between 32%-60% with full scoped work efforts.
- Clients who are unwilling or unable to consider disruptive strategies, but those that still want to work with NET(net) strategically to optimize mainframe consumption and maintenance costs can see savings that range anywhere from 13%-33%.
- Clients who believe they can do this all on their own and those who believe they have all the skills, toolsets, and market & supply side knowledge to get the best outcomes likely have a savings opportunity of 5-15%, but most get only minor or no savings and unfortunately erode the opportunity to get future savings by unknowingly making subtle yet critical mistakes which is why we always strongly recommend working with us as your trusted advisor.
Our next installment (8 of 10) in this 10-part series of the Top 10 Ways You can Save on your Mainframe Costs in 2023 is a detailed look at how client organizations can reduce costs by replacing legacy applications.
In all respects, extracting value from the mainframe supply chain in 2023 is not going to be easy as the big iron cartel will not only be wildly disruptive to any cost savings effort, but they will also be implementing their own cost increase agendas. If you're ready to take on the challenge and are dedicated to the hard work needed to achieve success, Contact Us today to learn more about working with NET(net) can help you save on your mainframe as well as all your other technology investments or Sign up now for a Savings Cloud subscription, and we will get started on helping you save money right away.
Founded in 2002, NET(net) is the world’s leading IT Investment Optimization firm, helping clients find, get, and keep more economic and strategic value in their technology supply chains. Over the last 20 years, NET(net) has influenced trillions of investment, captured hundreds of billions of value, and has helped clients cost and value optimize all major areas of IT Spend, including XaaS, Cloud, Hardware, Software, Services, Healthcare, Outsourcing, Infrastructure, and Telecommunications, among others. NET(net) has the experience you want, demonstrates the expertise that you need, and delivers the performance you demand and deserve. Contact us at firstname.lastname@example.org, visit us online at www.netnetweb.com, or call us at +1 (616) 546-3100 to see if we can help you capture more value in your IT investments, agreements, deployments, and relationships.
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