Four key success factors for IT modernization

Enterprises are rethinking IT priorities in the face of rapidly changing business demands. There’s a new focus on simplifying complex environments and increasing speed across the entire IT estate, from data centers and multiple clouds to remote work environments and advanced analytics. Demands for immediate cost savings, operational agility, resilience and security are driving change.

The case for reinventing IT

Modernization is a way for IT organizations to reinvent themselves and help the business rapidly scale and shorten time to market. It means new ways of working that harness the speed of the cloud and new cultures that value agility and innovation. Modern technology platforms help unlock data for deeper insights about customers and operations.

Ultimately, organizations can adapt to market changes faster and pursue new business models when empowered with digital services, agile processes and reliable business intelligence. This paper explores key success factors for modernization, from simplifying and optimizing existing IT to transforming applications and operations to run in a hybrid, multicloud world.

Four key success factors for IT modernization

For most organizations, IT modernization is a journey from traditional platforms and processes to a modern IT estate and a new operating model. The path to modernization encompasses four success factors: aligning IT with the business, simplifying and optimizing the existing IT, modernizing applications and data, and operating securely in a hybrid environment.

While modernization activities follow a natural sequence, each organization may focus on different parts of the journey — or work on all four simultaneously.

1. Align IT with the business

The first crucial step toward modernization is the alignment of IT and business strategies within the organization — determining which improvements fit with the overall business strategy, finding opportunities to align with that vision and developing a well thought-out plan.

This alignment requires high levels of collaboration and trust among senior leaders on the investments needed to achieve required business outcomes such as cost savings, flexibility and business acceleration. Through alignment and scenario planning, organizations gain a much better understanding of ROI and how budgets can be redirected for innovation. Remember that no plan is set in stone. Business and IT must reevaluate plans regularly, particularly when business conditions are uncertain. Continuous feedback and metrics will shape and reshape modernization activities.

2. Simplify and optimize IT

Overly complex systems prevent organizations from focusing on their strategic agendas. Aging IT estates can run up costs, impede quality and slow the pace of change. To optimize for costs, organizations can implement a technology refresh that includes lean processes and automation, improving workload placement, and eliminating unused or underused systems, services and data.

Organizations can also continuously optimize the IT environment with automated workload management tools and implement software-defined networks. Modernizing IT frees up resources and budget that can be immediately applied to innovation and drive new services and a move to the cloud.

Organizations may consider IT outsourcing to achieve immediate run-rate cost savings of up to 30 percent. Plus, outsourcers can reduce risks associated with a technology refresh or move to the cloud, and introduce a host of efficiencies such as greater automation, more predictable service levels and tighter security.

3. Modernize applications and data

Many traditional enterprises struggle to identify and implement a workload placement strategy for traditional and cloud environments. Often the barriers are both technical and financial. These can be overcome, in part, by justifying the business case for each application on a case-by-case basis, modernizing or transforming the application, then retiring them. This application rationalization process includes workload placement — essentially, deciding where an application and data should live and how it will best serve those who use it.

After the business priorities have been established, the organization can assess and rationalize the application (leading to cost savings), modernize or transform the application (enabling speed, agility and further savings) or deploy a cloud-based operating model — all while considering the security, performance and financial requirements.

4. Operate and secure hybrid at scale

Most large enterprises will have to maintain a hybrid IT estate in the near term, so they need an operating model that ensures the business can respond to market changes and continue to secure a much broader ecosystem as cloud resources grow. In a modern hybrid IT environment, organizations can continuously innovate, provision IT assets on demand and provide consumption elasticity while eliminating IT’s traditional fixed assets.

Managing this type of hybrid architecture presents challenges, including the need to scale and integrate cloud systems with the current IT environment. This requires organizations to develop new strategies for working in harmony with resources on premises, in data centers or the cloud and at the edge.

The new operating model ensures integrated operations, intelligent automation at scale and the ability to leverage analytics, AI and lean processes for greater insights, speed and efficiency.

A secure ecosystem is critical to the success of new operating models. All data is encrypted for security and privacy. Identities and roles are verified as organizations phase out passwords. Data traffic is monitored for cloud-to-edge awareness, compliance, audit and response. The security concept of Zero Trust is key to protecting the ecosystem in a hostile environment.

Putting a plan into action

Chief information officers need to build a justifiable business case for a modern IT estate. This starts with aligning modernization efforts with business strategy, exploring IT services that can free up money for new investments, and finding ways to consolidate applications and data to improve analytics programs. Successful execution requires a plan that covers people, processes and technology. Consider these strategies:

• Build for speed and insights. Modern IT environments help organizations increase speed and unlock data for the business. Data is a strategic asset that supports new ways of doing business. A modern platform enables deep analytics, including data mining, machine learning and predictive analytics, which results in proactive end-to-end management and better business intelligence.
• Design toward NoOps. Intelligent automation is key to creating agile operations and costs closely aligned with the business. Automation harnesses real-time data and machine learning to increase efficiencies in application services, development, IT delivery, security and more. Ultimately, IT should design toward NoOps, a further evolution of the operating model that relies on automation and self-healing systems.
• Plan on cultural change. Start with a core team across IT and expand outward to scale. As traditional approaches evolve with the move to cloud, IT must adopt new practices, including DevSecOps and site reliability engineering (SRE), which harnesses automation and applies it to the full technology stack. Software engineers focus on increasing automation, self-healing and reliability. This approach requires a merging and reskilling of development and operations personnel into combined teams that share multiple skills. By eliminating the silos, organizations can lower operating costs while simultaneously increasing application reliability and uptime.
• Don’t go it alone. Modernization is challenging, but you don’t have to go it alone. Get help from a supplier with integration expertise, cloud management capabilities and a proven track record of successful transformation at scale. Highly effective partners can offer a clear point of view, proven methodologies and a robust partner ecosystem that delivers technology-independent solutions.

How DXC can help

One of the world’s leading IT services firms, DXC Technology is a recognized leader in complex, enterprise-scale transformation. We help customers reduce modernization costs and risks while increasing agility at every stage.

DXC’s IT modernization solutions are underpinned by our enterprise technology stack, which includes an end-to-end suite of technology services, tools and capabilities such as DXC Platform X™, a data-driven approach to intelligent automation and machine learning, and our ecosystem of 200+ strategic and solution partners.

Learn more about how to modernize your enterprise with DXC Cloud services, Applications services and IT Outsourcing services.