Chris Koppe, VP of Corporate Strategy at Fresche Legacy presented Developing a Modernization Strategy: Evaluating the Options during iBelieve 2015. This presentation covers: - Modernization strategies - Establishing goals and objectives - Strategy definition - Planning - Getting funding and support

1. European Tour 2015
DUSSELDORF- ZURICH - VIENNA - PARIS - STUTTGART
Oct
27th
–
Nov
5th,
2015

2. Developing a
Modernization Strategy
EvaluatingtheOptions
Chris Koppe
Vice President of Strategy

3. Agenda
Modernization Strategies
Establishing Goals and Objectives
Strategy Definition
Planning
Getting Funding and Support
1
2
3
4
5
3

4. Setting the Context
What does modernization mean to
me?
Modernization+Strategies1
4

5. Code / Business
Logic
User Interface
(5250)
Technical View of Modernization
(Simple version)
• Code restructuring / modularization
• RPG-Free Format
• Data Access modularization
• Code Transformation
Database
• GUI / Web Enablement
• Mobile Access
• Workflow Optimization
• Desktop Integration
• DDS to DDL
• Data accessibility (long names, data model, reporting, etc.)
• Data security (RCAC)
• Data integrity (foreign key constraints)
5

6. Increased customer
retention
Increased
productivity
Sample Modernization – GUI Improvement
6

7. 3500 hours saved
per month across
175 users
$
10 days from start
of project to iPad
application delivery
Problems
Solved!
10days
Sample Modernization – Mobile Access
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8. Sample Modernization – Code Transformation
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9. 9
Establish a Long-Term Vision
What does your IT look like in 10 years?
Establishing+Goals+and+Objectives2

10. What does your IT look like in 10 years?
• What problems / might I be facing? Skill sets, resource availability
• What might the technology landscape look like?
• The impact of mobility and changing interfaces
• What pressures might the business be facing?
• Will IT be supporting / championing competitive differentiation,
streamlined operations, increased profitability?
• How will we support business agility and the pace of change?
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11. Challenges facing IBM i shops in 10 years
• Access to skilled resources
Retirement
Increased costs
• Pressure to keep up with what others are doing
• Pressure to respond quickly to changing business conditions and
opportunities (agility)
• Pressure to innovate for the business
• Pressure to reduce costs (increase profitability)
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12. Where does your business want you to
be in 10 years?
• Platform & Applications
• Languages & Technologies
• Database
• Reporting / Decision Support
• User Interface
• Interfaces with customers and suppliers
• The impact of mobility
12

13. 13
Drivers and Objectives
What are your modernization goals?
Establishing+Goals+and+Objectives2

14. Modernization Technical Goals
• New Graphical / Web User Interface
• Mobile Access
• Reporting and Data Management
• Big Data Opportunities
• Interfaces via Web Services
• Lead innovation efforts
• Leverage new technologies and
approaches
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15. Modernization Business Goals
• Agility
• Reduce training / onboarding
• Lower costs = increase profitability
• Drive innovation beyond competitors
• Enable new channels of access
• Merger and acquisition integration
• Compliance (SOX, HIPPA, etc.)
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16. The Modernization Journey
What does my journey look like?
Strategy(Definition3
16

17. Modernization is a Unique Journey
Unique Starting Point
(languages, technologies, apps)
Unique Destination
(target technology stack, packaged apps, etc.)
Uniquely staged to the needs of your
organization
Executed in a model that matches your need
17

18. Business Value Creation
How do my modernization goals align to
business goals?

19. What if…
Some reputable company said…
“Give us $1M and we will give you
your system back in 1 year running
on Linux in the latest technologies.”
• It will do exactly what it did, the way it
did it. (because changes cost more)
• Oh… and we’ll need most of your top
people for that year.
• Why: Future-proofing & to be
modern.
• ROI?: Too far out to be meaningful
Be the CEO
or CFO for the
moment.

20. Aligning to Business Value Creation
• What does the business get out of it?
• Move from an IT-centric perspective to a business-centric one
• Existing IT budgets are rarely adequate to fund mid-to-large scale
modernization initiatives
• The business will need to sponsor and fund the project
• A professional and strategic approach to the business is required
So… what business problems are you solving?
What is the Return-On-Investment to the business?
20

21. How to Create Business Value
• Creating Value
• Enabling new or incremental revenues
• Saving money that translates into improved profits
• Reducing effort, but only if it reduces labor / costs
• Enabling new markets or increased market-share
• It needs to be measureable and defendable
• Why does the business need this and who will fund it
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22. Business Value Creation example
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23. Business Value Creation Example
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Value Creation:
Reduced operating costs
Reduced printing costs
Improved workflow
Improved data quality
Faster new user on-boarding
Value Creation:
Improved data quality
Improved data timeliness
Value Creation:
Business
flexibility
Client servicing
Value Creation:
Reduced IT costs
Reduced operating costs
Improved agility
Improved resource avail.
New
Order Entry
Interface
Move to Real-Time
Modernize DB and
Back Office App.
Optional:
Print Engine
Replacement /
Optimization

24. Sample Project Timeline
24
Start
12M
24M
6M
18M
Stage 1:
New Order Entry
Stage 2:
Real-Time Push
Stage 3:
App & DB Port
Stage 4:
Print Eng. Repl.

25. 25
The Big Picture
Setting the
strategy.
Planning4

26. Modernization Challenges
• Knowing where and how to start
• Having a complete understanding and map of the existing systems (modules,
programs, data, dependencies, etc.)
• Knowing the difference between achievable and risky plans
• How to assess risk
• Getting funding and organizational support
• Knowing what tools and approaches exist in the market and how to
differentiate them
“The
pace
of
change
has
never
been
faster
and
the
need
for
IT
to
predictably
deliver
has
never
been
higher.”
26

27. 66%
Software projects fail to
be delivered on time or
within budget
Source: Mckinsey & Co., Oct, 2012 - Delivering large-scale IT projects on time, on budget, and on value
Software Project Statistics

28. Source: Gartner Feb, 2012 – How to Increase Your IT Project Success Rate
24% Software projects
fail completely
Software Project Statistics

29. 17%
of large software projects
actually go so badly that
they threaten the very
existence of the
company.
Source: Mckinsey & Co., Oct, 2012 - Delivering large-scale IT projects on time, on budget, and on value
Software Project Statistics

30. 56%
Of those who
modernize achieve
all the expected
benefits and more.
Source: Gartner Feb, 2012 – How to Increase Your IT Project Success Rate
Software Project Statistics

31. Finding the Right Strategy
Maintain
Modernize
Replace
Re?re
Applica1on
Support
Services
GUI,
SOA
&
Mobile
Enablement
Re-­‐hos1ng
Automated
Conversion
Code
Transforma1on
Re-­‐architec1ng
/
Re-­‐engineering
Re-­‐write
Packaged
Applica1on
Decommissioning
Strategy
Solu1on
Application
Modernization
Strategies &
Solutions

32. Adopt a Portfolio-based Approach
Application Module Modernization Strategy Rationale Timeframe
Accounting Packaged Replacement Non-Unique 2 years
Payroll Outsource Non-Unique 12 months
Shipping & Receiving Basic Modernization 12 months
Tracking & Logistics
UI, Desktop integration,
workflow optimization, business
Does not meet current business
6 months
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33. Planning4
Planning
How do I develop a modernization plan?

34. Planning Approach for GUI and Mobile
Enablement
Focus on User
Experience
Create Quick
Wins
1
2
3
4
5
Engage Think Focus Create Adopt
Engage with
the users
Think outside
the IBM I
Adopt
Agile
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35. Planning Approach for Large-Scale
Modernization
• Large-scale modernization projects require sizable funding and organizational
support
• Organizations expect results and predictability
• Many businesses have experienced failures, have shaken confidence in IT’s
ability to manage and deliver
• For IT leadership, these are high risk / high reward projects (Career makers
or career breakers)
• IT leaders must invest in building strong business cases, validated by experts
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36. Take a Phased Approach to Modernization
• Organizations don’t like to invest into multi-year programs where the benefits
only appear at the end.
• Create a milestone-based plan
• Establish a quick (and visible) win to show early success
• What does the business get “along the way”
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37. Planning Approach for Large-Scale
Modernization
Other Parallel Activities
Solution & Project Business & Financial
• Education on Tools & Approaches
• Solution Due Diligence
• Risk Assessment & Mitigation Plan
• Alignment to Business Value Creation
• Business Case
• Funding Model, TCO & ROI Analysis
37
Portfolio
Strategy
Modernization
Roadmap
Scoping &
Analysis
Planning &
Budgeting
Modernization
Project /
Program
5-Step Process

38. Getting Organizational Support & Funding
What does an organization want to see to fund and support a large-scale
project
• A clearly articulated business case
• Supported by details (current state, future state, how = plan, resources,
timeline, milestones, costs, spending schedule, scope, risks and
mitigations, alternatives researched, rationalization)
• How it aligns to creating business value and the future of the business
• Milestone-driven, with funding gates
• Thorough research, validated by experts
• Executive sponsorship
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39. What do you need to gather / build?
Inventory
Project Plan
Strategy / Approach Document
Budget
(and pending schedule)
Exec-level Presentation
• Scope
• Strategy and approach
• Resourcing
• Tools
• Costing
• Defining value to business (staged)
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40. Getting Funding & Support
How do I sell this to my organization?
Getting'Funding'and'Support5

41. Each Modernization Journey is Unique
• Unique Starting Point
(languages, technologies, apps)
• Unique Destination
(target technology stack, packaged apps, etc.)
• Uniquely staged to the needs of
your organization
• Executed in a model that matches
your needs
41

42. Each Organization is Unique
• Business challenges and growth
strategies
• State of IT and future vision of
supporting growth and innovation
• Approach to Cap-ex vs. Op-ex
• Degree of rationalization and selling
needed
• Attitudes towards consulting
42

43. Selling the Strategy is Organization-specific
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Build a strong
business case
Clearly define
the business
value creation
and how it aligns
to the priorities of
the business.
Pre-sell your strategy
and plan to stakeholders
long before they enter the
room.
• Enjoin them, integrate
their input and ideas
• Make them feel like its
their plan
Speak in
business
benefit terms
(not technical)

44. 44
Start Now
What do I do Monday
morning?

45. Getting Started – The next 2-4 weeks
45
Step 1
Develop a
Modernization
Strategy
straw-man
• What apps are in the portfolio?
• Define a timeframe
• Define / draft what
modernization looks like for
each app in the portfolio
• Define / quantify the Business
Value of your strategy
Step 2 Step 3
Seek
input
from
line-­‐of-­‐business
applica1on
stakeholders
Seek
external
valida?on
on
strategy
and
approach.

46. Developing a Modernization Strategy - Evaluating the Options
Chris Koppe
Vice President of Strategy
chris.koppe@freschelegacy.com
46
Thank You!