July 9, 2018

The Problem with Application Modernization

There are many demands and challenges surrounding application modernization, but new developments are opening up a new approach to addressing it, and it may help enterprises finally strike a balance between the need to develop new applications while modernizing their existing application stack.

Application modernization is now a top-of-mind issue for every IT leader — yet most organizations are doing little to actually modernize their application stack. Why?

On the one hand, there is tremendous pressure on IT leaders to move beyond the legacy application architectures of the past and create modern applications that will enable organizational agility, speed, and the ability to create the types of customer and employee experiences that drive competitive value.

Achieving this modernization, however, is more difficult than it sounds.

After years of belt-tightening, the modern enterprise IT organization is already running mean-and-lean and at-capacity, straining its ability to keep up with new demand — let alone modernize the in-production application stack.

These counterforces of increased demand and constrained resources, in combination with the complexity of legacy architectures, have left IT leaders struggling with how to approach application modernization.

In this four-part blog series, we will examine the demands and challenges surrounding application modernization, why new developments are opening up a new approach to addressing it, and how it may help enterprises finally strike the balance they need as they simultaneously develop new applications while modernizing their existing application stack.

The Need to Modernize

The term application modernization flows easily off the tongue. It’s almost fun to talk about. After all, what IT leader wouldn’t want to be seen as a force of modernization?

Because of the conflict between its innate appeal and the complex reality, however, far too many modernization efforts devolve into mere window dressing. An organization creates a snazzy new front-end to an old application or makes some modest changes to a legacy application, and they call it modernization.

But these types of faux modernization efforts belie the real issue that sits just beneath the surface: today’s increasingly fragile legacy application stacks are becoming an existential threat to the enterprise.

Throughout the industrial age, organizations created competitive value by optimizing their operational core — how they produced, delivered, and supported products or services in the market.

Today, however, enterprises must derive competitive value through the creation of exceptional customer and employee experiences. To do so, they must be able to rapidly and continually adapt their business processes and systems. Unfortunately, organizations built their legacy applications for operational optimization — not around creating these types of exceptional experiences and the adaptability they require. Thus, the need to modernize.

These legacy applications, however, have also grown increasingly complex and fragile as organizations have steadily added layers upon layers of additional functionality over time — making the needed modernization more difficult and risky.

The result of this complexity and fragility has been inertia as organizations have opted for inaction rather than choose either of the only apparent options available to them: a high-risk internal modernization effort using their already strapped resources or a high-cost outsourced modernization project.

A Dearth of Options

Inaction in the face of the business case for modernization seems counterintuitive. But enterprise leaders are between the proverbial rock and a hard spot.

They’ve had to choose between two unpleasant alternatives.

The first option has been to launch major modernization efforts using their internal resources. This approach typically involved a significant amount of time selecting new operational platforms for the new application, extensive planning exercises, and the allocation of large numbers of both management and development resources to the effort.

The most significant impact of these types of efforts, however, was the unavailability of internal resources for any other projects. In many cases, the mission-critical nature of the application caused the organization to go into near lock-down mode as they executed the project — creating a backlog of other growth-related initiatives.

As a result, many organizations turned to outsourcing partners to offload the work of modernization. While this approach has the benefit of freeing internal resources to remain focused on future-facing and growth-related projects, it is often a costly proposition.

Even if the cost wasn’t an issue, however, the biggest challenge with these types of outsourced modernization efforts was their high failure rate. By definition, outsourced development teams are unfamiliar with the intricate, inner-workings of an organization. When combined with the business-critical nature of the applications most likely to have their modernization efforts outsourced, the result was often a continuous stream of project delays, cost overruns, and outright failure to deliver a working replacement application.

The Intellyx Take

While some enterprises have been successful using either or both of the traditional modernization options, most have not.

Instead of realizing the benefits of modernizing, many organizations that embarked on these efforts found them to be big, expensive distractions that generated limited business value — at least in the short-term.

The challenge, of course, is that the modernization of the legacy application stack is a foundational activity. The costs of not modernizing — and, likewise, the benefits of doing so — are not always immediately visible to the organization.

The high risks combined with this lack of immediate value recognition have led many IT leaders to put-off their modernization efforts and instead remain focused on meeting new organizational demand. This has been a winning strategy for many IT leaders — at least for now.

The failure to modernize, however, is a bit like a big bill coming due. Organizations must find a way to address it — or find themselves locked-in and unable to compete as their legacy applications hang like an albatross around their necks.

The good news for IT and business leaders is that there is a new wave of modernization approaches that may finally offer organizations something beyond these two options. Rooted in new approaches to application development, this ‘third way’ may offers organizations a way to modernize without the risks and trade-offs of the past. In the remainder of this blog post series, we will explore this new approach, its implications, and how it may help enterprises finally find their balance. Stay tuned.

Originally published by Charles Araujo in Intellyx BrainBlog

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