Mainframe: Vicinity yet to be Explored
Date: Thursday , October 03, 2013
Micro Focus International plc (LSE: MCRO.L) is a Berkshire headquartered company that develops and sell software products and solutions worldwide. The company has a current market cap of $ 1.16 billion.
Today, mainframe plays a vital role in the daily operations of most of the world's largest corporations. While other forms of computing are also used by organizations, mainframe occupies a strong place in today's business environment. Initially, mainframe provided only acceptable means of handling the data processing requirements of a large organization, but owing to the technological advances, mainframe today is used by these organizations to host the most important and mission critical applications. Recognizing the opportunity of mainframe, companies from various verticals including banking, finance, healthcare, insurance, government and several others made a shift to this. The stable and nearly-unbreakable platform for processing huge amounts of corporate data has made these companies fasten to mainframe.
But with the mainframe's rising cost, corporations want modernization solutions that preserve the investment in their business-critical mainframe applications. However, modernization can mean different thing to different people. You can envisage in using old applications to something that is recent like mobile or cloud. The way we use this term is getting us mission critical business applications that have been running for 20-30 years into a state of readiness for today's business and for tomorrow's. In doing this, we bring them to a place where they need to be right now to deal with business pressures like faster, more accessibility, getting into new markets, mobile and maybe cloud.
But the question is, are applications ready for this shift right now? Not many, but it is all about getting ready to do and stay prepared for this shift. However, the shift is pretty tough as it is expensive and takes a long time to implement and integrate. Even then, there is a heavy risk of, have you captured everything that you need and that is how people look to modernize. Also, being a complicated method, people prefer to rewrite but they do not understand that rewriting projects takes a long time, very resource heavy and full of risk. Around 45-60 odd percent of rewrite projects fail. The way we look at it is revamping or reusing it which is currently the fastest and less risky way which will take what you currently have and is active. We try to do this without changing it to fit into those modern arrangements, i.e., moving applications into the cloud or mobile rather than rewriting specifically for much less risk and lesser cost.
The biggest problem that folks have on the mainframe is the technical depth. There is a gap in terms of time like 2-3 years apart in terms of money to get from where they are to mainframe modernization. The reason being, there is a surmountable work that needs to be done just to keep the lights on. Typically, a mainframe organization invests around 75-80 percent of their existing budget just to keep these applications running, maintain them, enhance them slightly, the regulatory issues that are coming in and leaves a tiny drop of the budget for innovation. And that is why people are looking to cut through this log jam of stacked up work and try and close the technical gap. We at Micro Focus are trying to free up that balance of budget so that they can spend more on innovation rather than at the backend.
Traditional methods are not changing, the gap is widening and the amounts are stacking up. Unless one throws resources at them, nothing will change. We got to think differently about how to break this mould and this is where Micro Focus focuses. But there is a dearth of skilled workforce with niche knowledge in mainframe. The biggest challenge with the mainframe is that the group that has worked on it — the Baby Boomers — is retiring. As the skill plays a vital role in mainframe and even colleges do not train their students in this space, we focus on skills and provide contemporary technology which is inviting and demystifying the mainframe environment for them.
We help organizations deliver services quicker with more competencies at much cheaper price. The key is cutting up the gap between modernizing the mainframe directly or through alternative ways so that we can free up the cash to be more innovative to get to the mobile. This is what Micro Focus is precisely focused on: equipping the System Integrators and modernizing the mainframe.