Infosys Modernization Radar 2022: Half of Enterprise Legacy Applications to be Modernized in the Next Two Years

Rhea-AI Summary

Infosys released the Modernization Radar 2022, revealing that 50% of global legacy applications are set to modernize within two years. This modernization is crucial for reducing operational costs, increasing revenues, and enhancing customer experience. Key findings highlight a majority of legacy systems are core to business, presenting significant risks due to inadequate support. Companies are encouraged to adopt strategic modernization plans, upskill talent, and utilize phased approaches to minimize disruptions.

Positive

• 50% of legacy applications expected to modernize in two years.
• Modernization leads to reduced operational costs and increased revenues.
• Study emphasizes need for strategic investment in modernization.

Negative

• 51% of respondents cite lack of skills as a major pain point.
• 45% of legacy systems are mainframes, posing potential risks.

BENGALURU, India , May 5, 2022 /PRNewswire/ -- The race to modernize continues, and companies already see the finish line, according to new research from the Infosys Knowledge Institute, the thought leadership and research arm of Infosys (NSE: INFY) (BSE: INFY) (NYSE: INFY). The study reveals that 50 percent of the global legacy application landscape is expected to modernize in the next two years, with 70-90 percent modernizing in the next five years.

Infosys Modernization Radar 2022 found that application modernization leads to increased benefits from cloud, enterprise data, and exponential technologies like analytics, APIs, AI and microservices. Modernization also improves scalability and creates a digital backbone. The research underscores that modernization reduces operational expenditures, increases revenues, and provides a better customer experience.

The research identified four swift and effective modernization approaches:

1. The right modernization strategy: Holistic, automated, and aligned

Our research found that 88 percent of systems are legacy; of those, 45 percent are legacy mainframe. More than half (52 percent) are core to the business, and the rest are supporting applications – all need to avoid the risk of disruption. Many of the legacy systems lack adequate support, making them vulnerable and presenting security risks. Companies should adopt a holistic view of the enterprise estate, increase automation, and align business and IT on modernization decisions.

2. Multiple talent pools reduce risk

Fifty-one percent of respondents cited the lack of skills and talent as a bigger pain point than the risk of disruption (27 percent) and modernization costs (24 percent). Companies need to upskill their employee base and acquire niche skills such as reengineering, database modernization, and rules externalization. The research recommends companies invest in their workforce, build communities of practice for modernization, and tap the gig economy to harness talent as a modernization tool.

3. Modernization investment should be more strategic than discretionary

Although companies on average invest a full 65 percent of discretionary budget on modernization projects, large companies tend to budget more strategically for modernization. These firms develop a clear modernization roadmap and are more likely to go all-in on big modernization projects. Modernization is now on the executive agenda, and it should become a crucial component of enterprise technology planning.

4. Phased approach and coexistent methodologies are less disruptive than a big-bang approach

A systematic phased and coexistent approaches to modernization cause the fewest disruptions. When legacy and modernized applications coexist with two-way data syncing, this coexistence limits end-user disruptions. According to the research, 51 percent of respondents who extensively use a big-bang approach experience more frequent and severe disruption. However, severe disruption levels and frequency for a phased and coexistent methods were far lower.

Ravi Kumar S, President, Infosys, said, "Enterprises must accelerate their modernization journey and it is imperative that they act now. As the Infosys Modernization Radar 2022 shows, a wait-and-see approach is just not tenable. Modernization plays a pivotal role in equipping businesses to deliver strategically and seamlessly in a customer-centric era. Our Infosys Modernization Suite, part of Infosys Cobalt, helps enterprises modernize their legacy systems and become future-ready."

To learn more about Infosys Modernization Radar 2022, please visit:

https://www.infosys.com/services/application-modernization/insights/modernization-radar-2022.html

Methodology

Infosys used a blind format to conduct an online survey of 1,500 senior technology leaders and executives across thirteen industries across the U.S., Europe, Australia, and New Zealand. To gain additional qualitative insights, phone interviews were also conducted with practitioners and subject matter experts.

About Infosys

Infosys is a global leader in next-generation digital services and consulting. We enable clients in more than 50 countries to navigate their digital transformation. With over four decades of experience in managing the systems and workings of global enterprises, we expertly steer our clients through their digital journey. We do it by enabling the enterprise with an AI-powered core that helps prioritize the execution of change. We also empower the business with agile digital at scale to deliver unprecedented levels of performance and customer delight. Our always-on learning agenda drives their continuous improvement through building and transferring digital skills, expertise, and ideas from our innovation ecosystem.

Visit www.infosys.com to see how Infosys (NSE: INFY) (BSE: INFY) (NYSE: INFY) can help your enterprise navigate your next.

Safe Harbor

Certain statements in this release concerning our future growth prospects, financial expectations and plans for navigating the COVID-19 impact on our employees, clients and stakeholders are forward-looking statements intended to qualify for the 'safe harbor' under the Private Securities Litigation Reform Act of 1995, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding COVID-19 and the effects of government and other measures seeking to contain its spread, risks related to an economic downturn or recession in India, the United States and other countries around the world, changes in political, business, and economic conditions, fluctuations in earnings, fluctuations in foreign exchange rates, our ability to manage growth, intense competition in IT services including those factors which may affect our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, industry segment concentration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which Infosys has made strategic investments, withdrawal or expiration of governmental fiscal incentives, political instability and regional conflicts, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property and general economic conditions affecting our industry and the outcome of pending litigation and government investigation. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our Annual Report on Form 20-F for the fiscal year ended March 31, 2021. These filings are available at www.sec.gov. Infosys may, from time to time, make additional written and oral forward-looking statements, including statements contained in the Company's filings with the Securities and Exchange Commission and our reports to shareholders. The Company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the Company unless it is required by law.

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SOURCE Infosys

FAQ

What does the Infosys Modernization Radar 2022 report indicate for INFY?

The report indicates that 50% of legacy applications are expected to modernize in the next two years, which is crucial for operational efficiency.

How does modernization affect operational costs according to Infosys?

The research shows that modernization reduces operational expenditures and increases revenue.

What percentage of legacy applications are expected to modernize in five years according to INFY's report?

The report estimates that 70-90% of legacy applications will modernize within five years.

What is a significant risk identified in the Infosys Modernization Radar 2022?

A significant risk is the lack of adequate support for 88% of legacy systems, which makes them vulnerable.

What strategies does Infosys recommend for modernization?

Infosys recommends adopting a holistic, automated approach, investing in talent, and using strategic budgeting for modernization efforts.