Steven Zolman

Nov. 29,2023 | Software, Mainframe, IBM, Maintenance and Support

Preface:

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.

Introduction:

When it comes to Mainframes, NET(net) sees incredible savings opportunities in 2023 and into 2024. 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 (Sep 1):   Modernizing Mainframe Applications 
• Part 8 (Oct 1):   Replacing Custom Developed Applications with Packaged Applications

Part #9 of 10: Competitively Displacing Mainframe Applications

Competitive displacement of ISV products on mainframe....

In the previous parts of this series, we have discussed a variety of ways for large enterprises to save on their mainframe costs. In this part, we will focus on competitive displacement of ISV products on mainframe.

What is competitive displacement?

Competitive displacement is the process of replacing an existing product or service with a competing one. In the context of mainframe ISV products, it means switching from one ISV product to another ISV product that provides similar or better functionality at a lower cost.

Why displace one ISV product with another?

There are a number of reasons why large enterprises might want to displace one ISV product with another:

• Cost savings: ISV products are often expensive, and there can be significant savings to be had by switching to a more cost-effective alternative.
• Improved functionality: ISV products are constantly evolving, and newer products often offer more features and functionality than older products.
• Reduced risk: ISV products are typically well-tested and supported, which reduces the risk of problems and ensures that the applications will be able to meet the needs of the business.
• Improved agility: ISV solutions can often be deployed and updated more quickly and easily than legacy ISV products.

How to competitively displace one ISV product with another:

There are a few key steps involved in competitively displacing one ISV product with another:

1. Identify your displacement targets. Not all mainframe ISV products are good candidates for displacement. Start by identifying the products that are most expensive to maintain, or that are not meeting the needs of the business.
2. Research ISV solutions. Once you have identified your displacement targets, research ISV solutions that can meet your needs. Consider factors such as cost, functionality, ease of deployment, and support.
3. Develop a business case. Once you have identified a few potential ISV solutions, develop a business case that quantifies the benefits of displacement. This will help you to get buy-in from senior management.
4. Negotiate with ISVs. Once you have developed a business case, negotiate with ISVs to get the best possible pricing and terms.
5. Migrate your data and train your users. Once you have chosen an ISV solution, you will need to migrate your data and train your users on the new system.

Tips for Success

Here are some additional tips for successfully displacing one ISV product with another:

• Get buy-in from all stakeholders early on. This includes your users, IT staff, and senior management.
• Choose an ISV solution that is a good fit for your needs and budget.
• Develop a detailed migration plan. This will help to ensure that the switch is smooth and seamless.
• Communicate with your users throughout the process. Let them know what to expect and how the new product will benefit them.
• Provide training and support to your users. This will help them to get up to speed on the new product quickly and easily.

Conclusion

Competitive displacement of one ISV product with another can be a great way for large enterprises to save money and improve their IT operations. However, it is important to carefully consider all of the factors involved before making a decision.

By following the tips above, you can increase your chances of success in displacing your mainframe ISV products.

Stay Tuned

Our final installment (10 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 better managing mainframe workloads.

Summary

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.

About NET(net)

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 info@netnetweb.com, 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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