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Kyndryl survey reveals that mainframe modernisation is driving profitability

Kyndryl, the world’s largest IT infrastructure services provider, has unveiled the findings of its inaugural global survey and analysis of the current and future state of mainframe modernisation for businesses. The survey among 500 business and IT leaders finds that most organisations are taking a hybrid approach to mainframe modernisation, and the respondents reported collectively achieving $12.5B in cost savings.

In today´s competitive and fast-changing business environment where many leaders are reconsidering spending choices, enterprises are looking for ways to start or accelerate their mainframe modernisation journey to drive increased efficiency, agility, and innovation. According to Kyndryl’s survey, as companies seek to transform their mainframe environment:
95% of respondents are moving at least some of their mainframe applications to cloud or distributed platforms, on average 37% of their workloads. Only 1% of respondents plan to move all workloads fully off the mainframe.
90% of respondents state the mainframe remains essential to their business operations due to its high levels of security, reliability, and performance, while having the flexibility to move to cloud platforms for efficiency.

Enterprises looking to update their mission-critical operations are approaching modernisation in three ways – modernising on the mainframe, integrating with the hyperscalers, or moving off to the cloud. Almost all respondents use a combination of approaches, by considering the capabilities of each platform and tailoring projects to their business and technical needs.

A key observation is that regardless of the chosen mainframe modernisation approach, businesses report reduced costs and increased profitability by 9% to 11%. Average annual cost savings per organisation are $25M, showing that mainframe modernisation yields a positive return on investment. In addition to financial benefits, respondents indicate that transformation is fueling innovation by allowing them to take advantage of increased scalability and faster time to market.

Kyndryl’s survey uncovers that respondents share a common concern about security, no matter what transformation path they choose. Security is the most important factor noted (49%) in defining an organisation’s transformation strategy. At the same time, it is one of the most crucial elements for the success of a mainframe modernisation project and the most popular topic for training and upskilling. Concerns about declining mainframe skills are also cited as a major challenge for more than half of the organisations surveyed, and this skills gap represents job opportunities for rising technical talent. In fact, 74% of respondents say they rely on external firms to support them on the transformation due to their skills challenges.

“Our survey reveals that mainframes increasingly become an integral part of hybrid cloud environments and continue to drive business value. However, the lack of a skilled workforce to support and secure these mission-critical environments is a significant cause of anxiety for many businesses,” said Petra Goude, Global Practice Leader for Core Enterprise & zCloud at Kyndryl. “Finding a trusted advisor and integrator with deep expertise and experience is key to success – no matter where organisations are on their journey and how they aim to execute their transformation. The survey shows that maintaining the status quo is not a path to modernisation or growth.”

Kyndryl commissioned Coleman Parkes Research to survey 500 decision-makers including CTO/CIOs, IT Directors and Business Leaders from enterprises across all industries and government, of different sizes, with different levels of dependency on the mainframe, and at different points in their modernisation journey.

To learn more about the insights gathered on how respondents view mainframe transformation and application modernisation, as well as the challenges, risks, and benefits related to their initiatives, go to http://www.kyndryl.com/mainframe-modernization-report-2023

About Kyndryl
Kyndryl (NYSE: KD) is the world’s largest IT infrastructure services provider, serving thousands of enterprise customers in more than 60 countries. The company designs, builds, manages and modernises the complex, mission-critical information systems that the world depends on every day. For more information, please visit www.kyndryl.com.