Enterprises in Europe need to double down on their digital transformation efforts in a new era of real-time data insights, AI, and ever-rising customer expectations.
The agility and efficiency afforded by cloud-native development have become essential for organisations that want to fully leverage the potential of digital transformation.
In particular, enterprises need to move beyond what might be called “adoption modernisation” to a broader, more continuous approach that involves a long-term plan and clearly defined strategy.
By blending application modernisation with microservices and efficient purpose-driven platform-native services, organisations do more than simply ensure that applications run smoothly at lower cost.
The aim of this broader approach involves a bigger pay-off, including the potential for innovation that generates more revenue and profit.
Ambitious path
The need to pursue a more ambitious path is clearly laid out in a recent survey by IDC, which suggests that nearly four out of 10 organisations (37%) based on the continent regard modernising their applications as a top priority. 1
This may sound positive, but IDC also suggests that going cloud-native is still in its infancy. Only 26% of cloud custom business apps rely on the flexibility of a full cloud-native development and delivery model. And fully 27% of European organisations are still stuck with legacy applications and processes.2
Shifting modernised Microsoft workloads running on .NET applications and SQL Server to a cloud platform like AWS, for example, typically generates better price/performance ratios, improved resilience, scalability, and security – all with less technical debt.
However, when operational gains and adoption modernisation dominate thinking, CIOs or CFOs will typically give developers approval for a tightly defined project.
Once the developers reach the peak of that mountain, they descend, preparing to start work on the next project. The risk with this one-and-done approach is that each completed project risks entering a dormant phase.
Strategic vision
“Companies like these complete some fundamental initial modernisation, using containerisation and DevOps to create deliver reliability, scalability, and consistent application performance,” says Johan Carlsson, sales and marketing director at Opsio. “But they lack strategic vision and often miss out on what we might call the next generation benefits of application modernisation, which involves leveraging technology to boost the performance of the entire organisation in a holistic fashion.”
In the case of a retailer, for example, these benefits might include going beyond adoption modernisation by using AI and machine learning for personalisation, demand prediction, and inventory management. For a manufacturer, the benefits could include deploying IoT and machine learning to enable predictive maintenance and using visual inspection to automate quality control during production.
This kind of continuous approach to modernisation is typically driven by a cross-functional effort to realise the business value that could be generated under changed circumstances. With these goals defined, combined IT/business teams can work their way back to define the technology shifts required for innovation.
Organisations that follow this path will accelerate progress toward a data-driven future in which automation and AI will increasingly drive value creation. Navigating the complexities of continuous modernisation is not easy.
However, partnering with experts who can deliver value rapidly can make a big difference, opening up the full potential of next-generation application modernisation.
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1IDC, European Application Modernization Strategies, 2023 (Doc # EUR151362923, November 2023). [Relevant data is on p5 (i.e., 37%]