Embrace mindful, holistic, and
business-
led modernization
It’s no secret that many enterprises rely heavily on mainframes. For this blog, we will focus on financial services firms, where 88% of the top 50 banks and 80% of the top ten US insurance companies still rely on mainframes – but the concepts we’ll cover can apply in any industry that must manage risk. Mainframes just can’t keep up with increases in regulation, compliance issues, and higher consumer expectations. The one thing the industry can’t afford to do is stand still.
Financial services firms and most other enterprises must embrace modernization while remaining mindful of risk. Planning each step separately or waiting until the last second won’t suffice. Instead, firms must plan and execute the entire modernization process as a holistic journey based on both business and technological fundamentals. This approach makes it possible to achieve industry-leading customer experience (CX) and security while preserving decades of essential business logic and taking advantage of large sets of historical data.
Mainframes must move forward
For all their power, mainframes are a drag on financial resources, innovation, and agility. Mainframes typically consume 70% of an IT department’s budget, according to Gartner. Plus, as mainframe experts age and retire, finding replacements is a major challenge. While cloud platforms are a key component of modernization, Forrester reports that mainframes have hindered nearly 50% of insurance firms from migrating to an agile, cloud-based dev system. Many banks and insurance firms only touch the mainframe when absolutely necessary because they could disrupt core business processes.
Yet the longer the mainframe stagnates, the more outdated the company’s CX and security measures become and the gap with vanguards is widening.
To control risk while remaining agile and keeping up with constantly evolving threats and regulations, executives need a comprehensive plan to enter the modern era and design an incremental and iterative approach to build the banking and insurance platforms of the future.