Unlocking technical wellness: A holistic approach to modernizing core systems

In today's rapidly evolving technology landscape, businesses are grappling with the challenge of managing their core systems' health, as technologies that were once at the cutting edge eventually become legacy systems that need to be updated.

This has led to burgeoning technical debt, or the cost of not updating core systems. While businesses have tried to address this through piecemeal fixes, the demands of new technologies are beginning to make this approach obsolete.

At present, many businesses are dealing with aging networks that can’t keep up with emerging technologies like 5G and Wifi 6. Data centres might be moving to the cloud, but data management needs to be improved to meet the demands of new technologies like generative AI. Even recent software-as-a-service (SaaS) implementations that were supposed to address the limitations of legacy systems are struggling to keep up.

Businesses looking to lead must pivot from watching their technical debt rise, and be proactive when it comes to upgrading their systems. This means identifying the right improvements, and the best times to make them.

Rather than thinking in terms of debt, it’ll be more useful to consider the overall health of their core systems. This parallels the typical approach to patient care, where cybersecurity, data, and other architectures receive annual checkups, and where preventative measures are taken for areas of the tech stack that need attention.

In adopting this modernization strategy, businesses will be best placed to address the challenge of technical debt and get ahead in 2024.

Identifying core issues: Prioritizing modernization efforts

Cost heavy data centres or heavily customized ERP systems - once drivers of growth – are now slowing enterprises down. This hasn’t escaped the notice of tech executives, with 70% acknowledging technical debt as an inhibitor to innovation within their business.

But while businesses recognize the transformative potential of newer technologies, many often fail to invest in their architectures, data, applications, cyber security and workforce capacity. This means businesses continue to suffer from the fallout of declining wellness, namely frustration with older platforms, negative morale among employees, and productivity issues which inflate the level of debt, with levels reaching $1.5 trillion in the US alone.

Another challenge is identifying the right approach to digital transformation. Many enterprises have faced disappointment with transformation initiatives that place overly optimistic bets on singular aspects of their foundational systems, ultimately failing to deliver the anticipated benefits.

Rather than opting for sporadic bursts of innovation or going for easy digital transformation wins, technology leaders should confront the stark reality: their tech stacks are starting to decay. Consequently, they need to seek out fresh strategies that determine how they allocate time and resources.

Moving forward, leaders should adopt a more astute approach to investment in modernization: conducting a methodical evaluation of their organization's requirements, capabilities, and financial resources across key modernization domains.

By embracing a more comprehensive perspective of their enterprise systems rooted in practical business insights, they can steer clear of the pitfalls of mounting technical debt, opting instead for a sustainable, long-term vision of their technical health.

The implications of technical debt

The costs and risks associated with technical debt are multifaceted and far-reaching. Direct expenses, such as maintenance of legacy hardware and software, are compounded by indirect costs and various other factors.

Ultimately, these pitfalls have become the core drivers of holistic modernization in the workplace:

·?????? Direct Costs: Direct expenses include capital and operational outlays tied to maintaining outdated hardware and software. This encompasses expenditures such as expiring support licenses or contractual obligations, along with personnel dedicated to legacy systems.

·?????? Indirect Costs: Inefficiencies within the antiquated technology ecosystem lead to indirect expenditures. These costs arise from unmonitored time and resources expended on data manipulation and analytics integration between legacy systems and contemporary applications.

·?????? Time-to-Market Impact: Delays or dilution of business initiatives occur due to the complexity or inefficiency inherent in the legacy technology infrastructure.

·?????? Barriers to Innovation: Deficiencies within legacy technology hinder growth initiatives, such as processing business-to-consumer orders or addressing language and currency constraints.

·?????? Operational Risk: Potential future obstacles to business scalability, reliability, and performance arise from technical limitations within legacy systems.

·?????? Security Risk: Legacy systems' susceptibility to cyber threats poses a significant security risk, as they lack the robust security capabilities of modern technologies.

·?????? Talent Risk: Presence of unresolved technical debt and outdated tools makes it challenging to attract and retain top-tier technology and business professionals.

Focusing on technical wellness emphasizes preventive measures to minimize these issues. Continuity is key here, as this method places the focus on advanced tracking, measurement, and predictive capabilities to spot subpar legacy technologies before they cause significant challenges to the business.

This enables tech leaders to predict when investments will yield the highest impact by paying attention to factors such as cost, operational risk, and readiness for innovation.

Five areas of focus for modernization: A comprehensive approach

The focus of this wellness diagnostic should be on the five areas of statistically largest spend, and where the opportunities are most significant. Each has its own modernization targets, which will change as emerging technologies become more sophisticated or as new ones gain prominence.

1.?????? Infrastructure:

Infrastructure encompasses a wide range of components, often posing significant challenges and costs. Notably, recent developments show that entire mainframe systems can transition to the cloud within 18 months, provided there's alignment on transformation goals.

Technical wellness in this domain involves migrating mainframes, servers, and end-user devices to the cloud, spanning various technical environments. Additionally, upgrades to aging networks—like fiber, LAN, and WAN—ensure modernization to 5G, Wi-Fi 6+, and other advanced connectivity technologies.

2.?????? Data:

Data management involves various life cycles, including cleansing, manipulation, and storage. Automation is crucial to streamline these processes, allowing more time for analyzing insights.

Modernizing data storage to cloud systems enables real-time streaming, enhancing applications such as predictive maintenance and smart city management. Real-time data usage is becoming an expectation for consumers, driving the need for fresher information.

3.?????? Applications:

This category covers both legacy custom applications and package applications like ERP and SaaS. Modernization strategies include replatforming, revitalizing, and replacing systems to keep pace with evolving vendor offerings.

Operations technology applications and product technology stacks, such as embedded products and digital offerings, are also under scrutiny for modernization efforts.

When considering the cost, it’s important to note that heavily customized business applications are costly to run and maintain, and instead the switch to standardised processes with 'out of the box' ERP software should be considered. These systems hold an advantage as they’re designed to accommodate as many businesses as possible, with a range of tools built in from the start.

4.?????? Workforce:

Organizations grapple with a diverse workforce, including internal and third-party contractors, impacting modernization efforts. Prioritizing the modern engineering experience through investments in tooling, processes, and culture is essential.

5.?????? Cyber Risk and Trust:

Evaluating cybersecurity involves assessing security, privacy, regulatory compliance, and ethical considerations. Automation is key to addressing security challenges, particularly with the rise of artificially generated content.

Embracing the journey towards technical wellness

Transitioning from technical debt to wellness presents a major opportunity to evolve the technology strategies businesses adopt. By embracing a holistic approach to modernizing core systems, businesses can discover new opportunities for growth, innovation, and competitive advantage.

As technology continues to advance, the pursuit of technical wellness will remain essential to navigate the complexities of the digital landscape and ultimately drive business success.

The increased focus on this strategy means it’s an interesting time to be working in the tech sector, as industry professionals stand to gain most from its implementation. Businesses will also need the input of experts to identify how best to improve their infrastructures.

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