Did you know that 74% of organizations have started modernizing their enterprise applications to drive digital transformation initiatives?  Application modernization is the process of taking existing legacy applications into a cloud-native architecture.
Modernizing your enterprise application stack is crucial in this rapidly growing cloud ecosystem to enhance productivity and drive revenue. Think modernizing your application stack is not that important? Check out this recent IDC  report, which claims more than 500 million digital apps and services will be developed using cloud-native approaches by 2023. This number sounds massive, proving the point that the enterprise application ecosystem will function in the cloud. If enterprises don’t modernize their enterprise applications, then they won’t be able to run their business in the cloud application ecosystem.
Why modernize enterprise applications? In a word: agility. A typical organization’s application stack consists of a varied mix of on-premises applications and cloud applications such as CRM, ERP, HCM, and custom applications.
It’s a tedious, if not impossible, task to carry out digital transformation initiatives if your organization has its business-critical applications operating in a siloed manner. Application integration fuels modernization by connecting applications to provide a unified view across business operations, processes, and systems. This not only helps the business meet the demands of an ever-changing market, but it also enables seamless integration and orchestration among applications—cloud and on-premises. Otherwise, data is siloed and disconnected.
No matter your size or industry, you must quickly adapt to new challenges – or risk losing out to the competition. In 2020, retailers had to suddenly shift their business models to offer online purchasing and curbside pickup. Manufacturers had to swiftly pivot their supply-chain operations to cover gaps in raw materials procurement. And educational institutions needed to immediately digitally connect their campuses and students to enable remote learning experiences. Many industry leaders today marvel at how fast they had to move. It all came down to being able to successfully react to change. That’s what we mean by agility.
Digital transformation initiatives may stall or just plain fail if enterprises operate their business-critical applications and processes in silos. Your enterprise might have best-of-breed applications deployed for various departments, but you cannot drive digital transformation initiatives if your applications are not talking to one another.
Application integration is crucial for application modernization. It helps enterprises drive agility to create competitive advantage by assembling and connecting applications with unprecedented speed. That said, application modernization isn’t easy. Here are some key things to keep in mind.
Cloud is an accelerator for every digital transformation. But, many enterprises have an application stack consisting of legacy on-premises systems (such as Siebel, PeopleSoft, and home-grown applications) that are inflexible, brittle, and expensive to maintain. To gain business agility, enterprises need to modernize legacy systems and turn to cloud-native applications like Workday, Salesforce, and others. The challenge is doing so quickly—and successfully.
The year 2020 saw almost 50% of small businesses close their doors – and many never reopened. Many big brands also filed for bankruptcy. Many reasons exist for these failures. But, I would argue that at least part of the blame can be attributed to the large, monolithic, and inflexible applications most organizations still have in place. In short: application modernization is key.
In a way, 2020 was a wakeup call: It’s time to evolve. No surprise that more than 90% organizations expect to increase their usage of cloud-based infrastructure. Is your organization ready to modernize? Application modernization is an ongoing endeavor, not a one-time exercise. So, keep modernizing your enterprise application stack to stay relevant to your customers.
Want to learn more about application and cloud modernization? Join us at Informatica World, which kicks off April 13. See you there!