Shared from the 2/25/2022 Financial Review eEdition

Transforming a reliable tech workhorse


Rumours of the mainframe’s death have been greatly exaggerated. Mainframes may not be front of mind when it comes to modern infrastructure, but they complete 90 per cent of the world’s credit card and electronic transactions accounting for almost $11 trillion, according to research by IBM. More than seven in every 10 companies in the Fortune 500 and over 90 per cent of the world’s biggest banks have mainframes at the core of their operations.

While large cloud providers talk a big game, they can only dream of that kind of market penetration. And while the world laments the cost of operating the world’s server farms, mainframes handle almost 70 per cent of the world’s production IT workloads on any given day, yet they consume just 6 per cent of total global IT costs.

The mainframe’s problem isn’t that it’s not fit for today’s computing needs. The challenges are around perceptions and skills.

“Today’s mainframes run proprietary and open-source applications,” explains Steven Hedge, executive chairman of mainframe system experts and solution providers ISI. “The nature and scale of the technology has advanced so much that it’s technically feasible for Australia to deploy a single mainframe to service the entire needs of all our major government agencies.

“But procurement teams feel uncomfortable investing in tech that’s 50 years old. And there’s a fear that there just aren’t enough mainframe skills available to support these platforms into the future.”

While the first mainframes may have been developed six decades ago, investment in mainframes has continued with upwards of $1 billion invested in some of the most recent mainframe platforms. But the skills required to manage and maximise the return on investment can be difficult to procure. This is why many companies and government agencies work with external partners to address skills concerns.

“Maximising the benefit of mainframe systems is a three-step process,” says Hedge. “It starts by optimising the existing environment, then modernising the applications and services that are running and transforming those that need to be rebuilt to meet the changing needs of today’s world.”

Optimisation focuses on reviewing every aspect of the mainframe’s operation, from operating costs and licensing agreements to looking for opportunities to automate repetitive, manual processes. One area that almost always results in significant cost reductions is software. Hedge likens some mainframe software vendors to medieval tax collectors who think their ‘villagers’ have no choice but to pay the tax as moving to alternative products is costly or technically prohibitive.

Australia’s banking sector is a great example of how mainframe applications can be modernised to meet the needs of today’s customers.

By retaining the fast transactional throughput and high levels of reliability, banks have been able to deliver excellent customer service through vastly improved mobile and online banking. And today’s mainframes are far more secure than most people realise. The decision about what to encrypt is not a decision – all data, whether in flight or at rest, can be encrypted within any application or service when it resides on a mainframe.

“There are many things that mainframes are great at,” says Hedge. “Consumers don’t care if their telco bill or utility bill is created on a mainframe or the cloud – they’re oblivious. Yet some organisations are spending millions to get off a mainframe that does a very good job of that kind of work. By focusing on what matters, you can keep the mainframe’s best qualities and modernise applications where there is the greatest value.”

Hybrid environments are now being adopted by many leading organisations, says Nicholas Flood, country manager for IBM Australia.

“Many business and technology leaders have expanded and grown their existing investments in mainframe technology and are applying this platform’s unique qualities to ensure that the critical next-gen hybrid cloud computing environments supporting digital transformation efforts can be built on trust.”

There are times, however, where delivering the best result for a business and its customers means finding a path towards a new environment. Talking about this sort of transformation, where a service or application is moved away from the mainframe to an environment that better suits today’s needs, is far more complex than it sounds. It requires specific expertise in both the mainframe platform and the chosen destination.

Mainframes have continued to adapt and evolve to fit into the modern world. Workloads that need large-scale transaction processing, huge scalability, native security and reliability are the mainframe’s bread and butter.

Matt Coates, who leads Accenture’s Cloud First business across Australia and New Zealand, adds: “The strategic use of mainframe is increasingly front of mind for Australian organisations as they look to transform at speed and scale. If organisations are going to maintain a competitive advantage, they need to digitise and transfer applications to the cloud. The organisations that are ahead of the curve in modernising their mainframe will reap the benefits and continue to drive sustainable growth.”

This is why mainframes remain the workhorses of the business world. With the right skills a mainframe environment can transform into a powerful and flexible platform that meets today’s needs and is ready for the future.

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