Webinar: The New Economics of Mainframe Modernization- Powered by GenAI- Amdocs & CIO webinar

Hello. I'm Kathleen Hall of CI Marketing Services, and I'll be your host and moderator for today's webcast of the new economics of mainframe modernization powered by AI. Mainframe systems have long supported mission critical operations across industries from banking and insurance to telecoms, government and retail. Yet for decades, organizations have explored how to move off these legacy platforms driven by rising costs, talent shortages, and limited compatibility with modern IT environments. Despite this, many have held back concerned about the risks of disruption, complexity, and cost. But doing nothing may pose an even greater risk. Ageing mainframes can hinder agility, inflate operational expenses and slow innovation, especially in sectors facing intense competition and digital transformation. In this webinar, brought to you by CIO and Amdocs, we'll explore how organizations can break free from legacy constraints through a self funded modernization model powered by GenAI, automation and cloud technologies. You'll learn how to unlock the full value of mainframe transformation with minimal disruption and measurable impact from day one. Well, joining me today to discuss this topic, have two guests, Chad Jones, Chief Revenue Officer at Astadia, the mainframe modernization practice of Amdocs, and Oad Kaufman, senior director of global business development and sales at Amdocs. Welcome both. Did you want to say a few words to introduce yourselves? Chad. Thank you. Sure. Yeah. Hey, everyone. My name is Chad Jones. As, Kathleen just said, I'm the chief revenue officer for Astadia, the mainframe modernization practice at Amdocs. I'm responsible for, global sales and go to market for our mainframe modernization business. So good to meet everyone. Hello, everyone. Noat Kaufman, as Kathleen introduced, senior director global business development and strategic sales for Amdoc Studios. So, basically, I'm completing the other pieces together with Chad Jones on the other practices on top of the refactoring and the Stadia capabilities in order to complete a holistic offering and go to market together with Amdoc's services. Thank you for having me. Thank you so much for being here. So as I mentioned just now in my introduction, there are a few challenges organizations are facing with their current mainframe environments. Chad, I wondered if you could elaborate on that a bit more, please. Sure, Kathleen. The there are three or four key business drivers for most companies who are looking to modernize their mainframes today. The first one is skills available to support mainframe systems. The developers who wrote the applications that are running on mainframes wrote these applications forty, fifty years ago in some cases and have long retired from the businesses. So you have applications that are not documented. The developers are no longer there to support them, and the skills available in the market that understand these applications are retiring year over year. So there's a skills gap or skills shortage that's driving companies to modernize off the mainframe. Costs are also a major factor. Mainframe platforms are very expensive. The hardware, the software, third party licensing costs, that's a that's a key business driver. And just the lack of agility in having your mission critical applications locked into a a closed end system like a mainframe, it's difficult to migrate with the rest of the world. It's difficult to access your data. So that lack of agility is really driving a lot of companies to wanna modernize as well. Yeah. It was spot on, Chad. Just to add one more thing on top of it, if I may, and I think you touched it, but just to to expand it a bit, so the innovation barriers. Okay? So, basically, what we see with all the introduction of the modern demands, GenAI, real time analytics, and stuff like that, which is very hard to achieve with the legacy and mainframe systems. So that's another challenge that mainframe owners face today. So, Howard, moving on from that point, could I ask why is the mainframe still considered both a strategic asset and a strategic risk in today's digital landscape? Yeah. So, basically, that's what we call the mainframe dilemma. So on one hand, for decades, the mainframe had the backbone of mission critical operations across industries because we have couple of items that really the characteristics of the mainframe, reliable, always on, high performance, and secured. So with that, as mentioned in in the previous discussion, today, we are moving more into an open world, more agile, modern with GenAI and some other new capabilities that the mainframe is perceived as an anchor, legacy anchor that actually holding us back from transforming into the new world. So that's why I think that the mainframe owners have a challenge. So on one hand, it's a critical system. It it performed well. It always deliver. But on the other hand, it's holding them back to complete and to achieve the transformation that they are looking for. Yeah. I'll just add. I first of I completely agree with OHAD, and you hit on the point that mainframes are highly performant and secure. They have been. That's why workloads are still running on them. Most of the workloads that are coming off the mainframe are going to cloud at this point. And I think there was that period where companies wanted to make sure that hyperscalers and and cloud targets could be as performant, as reliable, as secure as the mainframe. And we're at that point now where there's no question. You can run applications in the cloud, with performance that's equal to and in some cases even better, getting horizontal scaling and all the other performance related aspects that come with cloud, and cloud has proven to be very secure. Great. Thank you. There's clearly an interest and a need to modernize. What are some of the obstacles companies are facing when trying to modernize their mainframe environments? Chad? Yeah. So the I would say the biggest obstacle is back to the point that I made earlier, these are these are systems that were developed decades ago. And you have applications that were written forty, fifty years ago. They're not documented. The first step in in being able to modernize a workload and move it is understanding what you're moving in the first place. So not having documented systems is a challenge. Not understanding how to take the first step. Right? I mean, if you've got a mainframe with, you know, hundreds of applications that are on it, taking that portfolio analysis or docker top down approach to really build the roadmap and the plan and understand how you're gonna migrate workloads off, what pattern you're gonna follow, how you're gonna prioritize those is really key. And I think a lot of companies get stuck in trying to figure out just that planning phase so that they know that they're doing it right. It's really critical to work with companies who have done it before and partners like Amdocs so that we can help you, through that process. Oh, I'd I'd like to get your take. Yeah. So I think I I completely agree with all the points that Chad mentioned. Just to echo it, I think that from a mainframe owner perspective, this is really the the the the heart of the system, and they are really afraid, you know, to touch and to open this box. It's like an open heart surgery. Right? So they are really afraid because as mentioned, you know, it's like a tribal knowledge. Right? Nobody really documented it. Nobody today wants to learn this COBOL and all these kind of languages. Right? It's not an attractive programming language that the young generation are trying to to learn. So this is add a lot of complexity and a lot of uncertainty to the to the CIOs and whoever is on the mainframe to to actually make the transformation. Absolutely. So in which industries do you see a higher interest or urgency in accelerating the modernization journey? So I think, in general, we see it. If if I need to to choose the the top three, for example, I will go with the financial financial services for sure. We see it a lot. We see it a lot in insurance companies as well and telcos. So I think those are the three major ones. On the other hand, we do see it. You know, it's really across industry, and, you know, you can see it in retail, manufacturing, automotive, etcetera. But if I need to pick up, I think that really it's a financial, telcos, and and insurance companies. Would you agree, Chad? I agree with Ahad. The the pain points that we touched on earlier are pretty universal. So we we see customers in any industry with mainframes working on plans and migrating workloads off of those mainframes. It's a priority for any businesses that are running running applications on a mainframe. So you've mentioned that, obviously, there's been an interest to do this for decades. Is this a good time for organizations relying on mainframes to modernize? I think we we both me and Chad can say together, absolutely. And if if I may, Chad, just to to add here, I think that I have a good a good quote on that actually is that about the timing. So it's actually every day spent maintaining the legacy is a day not spent building the future. So I think there is no better time than today if you didn't do it already, but really to, you know, transform, you know, join the the the modern environments, the future proof environment, etcetera, and and do it. That's the right timing. I completely agree with Oed. Risk has been the factor that's held companies back from migrating in the past, And we're at a point now where there are proven, repeatable, predictable patterns that are available. There's automation that's available. There there are tools in the market like Astadia has been migrating workloads off the mainframe for decades now. So these aren't companies who are the first people moving off the mainframe. It's these are proven, hardened, mature tools and patterns, which significantly reduces the risk. So now is a great time. Absolutely. And even McKinsey, the consulting firm supporting it with their quote of cost of inaction will exceed the cost of transformation. So they are absolutely agreed that, you know, if you you won't do nothing today, you will ended up paying more than doing the transformation. Alright. Thank you. So, obviously, we have to talk about GenAI. Can you tell us how this has been leveraged as part of this journey, Chad? Absolutely. Just kind of going back to your last question and and tying generative AI into that. Generative AI itself is a reason why companies are moving workloads off the mainframe. You can't really have a solid generative AI strategy if you have your data locked into a legacy database on the mainframe. So it's really critical to move that data off into the cloud and and get it into a data lake and other modern, data architecture and structures. But, yeah, generative AI is having a huge impact, on mainframe modernization. It's I guess, the first thing to talk about that's important is what it's not. It's not its own pattern. Today, at least, you can't leverage generative AI to completely migrate a work application or a workload off the mainframe. It's an accelerator and an enabler for other patterns that already exist. So, like, for example, we're we're using generative AI in our mainframe practice to help us document and understand applications as part of the assessment process. We're also able to take applications that have been modernized, that we've used our tools to convert applications written in COBOL and assembler to a modern, Java like for like functionally equivalent application and continue that modernization journey forward. So generative AI can take that converted application and now bring it forward into a microservices architecture once it's in the cloud. So it's a it's an accelerator and enabler, and it's a it's a really exciting time, and it's an interesting technology. Right. And and I think that on top of that with the Amdoc Studios and and Amdoc Services, we actually inject GenAI in each step of the end to end modernization, which means the QE, We have an agents that's supporting that, the cloud migration, the day to operations. So we will touch about the solution in in a minute, I guess, but it's important to mention that, as Chad mentioned, the GenAI, it's not only a strategy. It's already in place, and we're already implementing it and leveraging this incredible technology. Thanks, Adya. You beat me to it. I was gonna ask you about the the key building blocks of your solution. Could you elaborate a bit more, please? Sure. With pleasure. So, basically and I think this is kind of what you need in our perspective. So so we are looking at this mainframe modernization in the end to end view, not only on the conversion from COBOL to Java or from a legacy language to a modern language, etcetera. We are looking at each step as part of the end to end modernization. And we created we structured it with the four blocks. Block number one is maintaining and operating the legacy mainframe systems. Block number two is the refactoring. Block number three is the cloud migration, and block number four is what we call day two operation and manage manage services. On top of that, we have the quality engineering in each step and in each touch point within this process. We have the lead aside on top of that. And once we actually migrate it, we can leverage data services and experience services. So all of this, you know, we club it together under the offering of what we call the mainframe to the cloud. Okay. Did you have anything to add, Chad? Yeah. I I think O had described it well. I mean, I I think what's very unique about our end to end approach and capabilities to be able to, you know, manage a mainframe on the front end of a program through to day two operations after it's been modernized is you have one throat to choke. You've got a a single point of responsibility in a program, which is critical when you're talking about, projects that are as risky as mainframe modernization. It also puts us in a very unique perspective to be able to develop commercial constructs that help customers deal with the the double bubble or, that, you know, on a two or a three year project, you have to continue paying for your legacy system while you're also paying to to modernize and move, to your modern system. We have really, unique commercial constructs that we can put together with our customers. Thank you for that. And and on the point about customer examples, do you have any examples of organizations who you've helped on this journey, Chad? Absolutely. Kathleen, I'll give you a example of a customer who, were in the middle of a very, very large project with today. It's a a tier one insurance company here in the United States. Large program, multiple mainframes. Their goal is to completely exit their data center and and move all of their applications and data off of the mainframe. Multiple mainframes, hundreds of applications, languages like COBOL, p l one, EZTRIVE, Telon, a similar anything that you'd see on a mainframe is is on their mainframe. Massive amount of data. We're using the Astadia tooling to refactor to like for like functionally equivalent Java with a target in AWS. When you look at the complexity and the risk of a project of that size, it's just a it's a a great example of a project that you know, we're able to use automation and and derisk the project. At the end of the project, the customer is gonna be in a much better modern target in the cloud. They'll eliminate the the risk that they have today associated with a lack of skills to support the system. They have applications that were written thirty, forty years ago. They're undocumented, and they're kind of just they don't wanna touch them because they don't know what what some of those applications do. We'll solve that problem for them. And, running on the mainframe is also very expensive. So there's an estimated cost savings of eighty to ninety percent in moving from a mainframe to a cloud environment. So there'll be a massive cost savings associated with that project as well. I think another, good example would be a telecommunications tier one telco company that we're working with on a very similar large scale project. OHAD, you'd probably be able to give a pretty good overview of that one. Absolutely. Thank you, Chad. So I would look I would like to mention a project, a very successful project that we did for telco tier one in in North America. And, basically, the challenges were aligned to what we mentioned as the mainframe owner challenges. So, basically, it was escalating costs of the existing legacy systems and then complexity between multiple vendors operating different aspects of the mainframe. So the solution that we bring is, first of all, we created a five year transformation road map with a reduction on the TCO. We did an innovative self funding program, which we mentioned earlier, very innovative and very successful. End to end accountability across different functions of ADM, application development and maintenance, IT, infrastructure, operation. We created a strategic cloud migration and partner with the hyperscalers in order to move their workloads to the cloud. We managed four hundred plus applications and fifty plus different ISVs in this project, and we leverage our partner ecosystem in order to support different activities within this program. And the impact was very successful. So first of all, we brought this customer to a future ready modern IT infrastructure. Sixty percent of the applications migrated to the cloud, meaning we actually reduced dramatically the usage and the costs of the maintaining the mainframe. Fifty percent plus reduction of the hardware and server count of of the mainframe, enhanced agility, resilience, and the security, and streamlined streamlined operation while moving into one single vendor that operate end to end all this new stack. Absolutely. And, Howard, could you tell us a little bit more about that, please, how you differ from other system integrators in this approach? Sure. So I think two two main items. One is, again, the end to end perspective and the the ability to do all the steps in an end to end mainframe modernization. Mainframe modernization is it's a complex project. Okay? Don't get it wrong. Right? And I think that we have the credibility and the knowledge and and the scars, right, that that we did it and the ability because we have in the Amdoc services each service and each competency and each practice in order to support this journey. As mentioned, you know, from the legacy operations through the application modernization, cloud migration, and day to operation. So this is one item. The second item is the self funding model, which I think it's unique. It's very appealing. It's very compelling. And it's really helping our customers because in that case, you don't need to secure a specific budget, etcetera. You just can rely on the savings that we will bring out of the mainframe operation, better contracting with the with an different third party's licensing, etcetera, and then bring those savings in order to fund the modernization. Great. Thank you. Chad, anything to add? I think OHA had covered it well there. I mean, I would just add that, you know, I think the big differentiator between the way that we approach it and and maybe other large SIs is we really focus on the business outcome. Being able to own the entire program from start to finish and being responsible for the entire program from start to finish really puts us in the position of making sure that we're driving the right program, we're finding success for the customer, and ultimately, it's focused on the business outcome, not just staff augmentation or delivering services. It's we wanna make sure that the we're giving the customer, the best possible outcome that we can. Excellent. Thank you. And my final question, what's your advice about the key components companies need to put in place to guarantee a successful modernization project? Chad, can I start with you? Sure. So I touched on this a little bit earlier. It's really critical to make sure that you're planning your modernization journey at the beginning. Right? You need to make sure that you're building a top down view of what that road map looks like, understanding your landscape, determining what the right patterns are by workload, leveraging automation wherever you can, and most importantly, working with partners that have that automation and have experience in doing it like a Stadia and HandOx. It's very critical, to work with companies like us who have done this before and have a proven successful track record of doing so. For a lot of companies and a lot of leadership people at those companies, migrating mainframe applications is something that they may not have done before. This may be their first first time doing it. So having partners that you're working with that have that experience is is extremely critical. Go ahead. Yep. So so spot on. And again, I think that, as mentioned, this is very complex project, and you need to make sure you choose the right vendor that has we call it, you know, that has the scars that did it before, that knows how to run and develop mission mission critical systems and how to operate them. So I think that's the the real game changer, right, to to find the right partner. And if you have a partner that can do all the steps and the end to end view, holistic view, that's even better. Thank you. That's a great note to end things on. That was a fascinating discussion. That's all we've got time for today. Once again, I'd like to thank my guests, Chad Jones from Astadia and Ewed Kaufman from Amdocs. And, of course, thank you to our audience for listening. For more information on this topic, please visit the Resources section on your screen. I'm Kathleen Hall. Goodbye.