NewsStrategy

About 12% of Singapore's IT decision makers polled in a global survey undertaken by Vanson Bourne and commissioned by Micro Focus, had started moving mainframe applications to the cloud (versus the global average of 16%), with 28% making plans for the next year (versus the global average of 42%) as part of application modernization plans.

Some 8% had already started to extend access to modernized mainframe applications from mobile devices (versus the global average of 14%), with 36% planning to start within the next twelve months (versus the global average of 49%).

The April 2012 survey, which is part of the "Mainframe Transformation: the Elephant in the Room" study, covered 590 IT decision makers in the UK (100), France (100), Germany (100), USA (100), Brazil (100), Australia (35), New Zealand (15), Hong Kong (15) and Singapore (25). The respondents were from mainframe organizations with more than 501 employees, from multiple industry sectors.

"Overall, in Singapore, 88% of respondents plan to modernize at least one key application in the next 12 months," said David Taylor, president of Asia Pacific & Japan at Micro Focus. "In order of priority, they included human resources, business process management, project and portfolio management, customer relationship management, finance and accounting and enterprise resource planning applications.

"The top three factors most likely to influence decisions on mainframe application modernization included reducing hardware and software licensing costs, increasing reliability, productivity and speed of operations and supporting IT systems for future innovation and business growth."

When asked what percentage of IT staff responsible for mainframe and applications would reach retirement age in the next five years, Singaporean IT leaders put the figure at 10% on average.

Of immediate concern, meanwhile, is that some 48% of Singapore's IT decision makers do not know the value of their IT debt, creating a hidden balance sheet liability for those organizations as well as a growing business risk. In the study, IT debt is defined as the cost of clearing the backlog of maintenance to bring the corporate applications portfolio up to date.

Globally, 590 CIOs and IT directors estimated their IT debt at US$10.9 million (S$13.8 million) on average, with US$8.5 million attributed to mainframe applications, and guessed their IT debt would grow on average by 10% over the next five years.

Gartner estimates that IT debt will break the trillion dollar mark globally in the next five years. In its 2012 Planning Guide: Application Delivery Strategies report, Gartner advises IT leaders to start a technical debt management programme to understand and tackle the liability.

However, 36% of Singapore respondents do not have a structured process for measuring and managing their IT debt today or don't know if they have one, and 25% of those without a process are not planning to implement one.

Despite their IT debt, 88% of Singapore respondents have a structured review process and strategy for their application portfolio, which they review on average every four months. However, an overwhelming 72% of them have a vague picture of their strategy.

For example, 24% said their portfolio contained legacy applications that no one knew how to update and that they were afraid to touch; some 13% have redundant applications eating up unnecessary processing power without the means to identify and retire them; and another 20% claimed merger and acquisition activity had created an unclear picture of the applications they have, the relationship between those applications and what should be retired.

"IT organizations in Singapore are tinkering under the bonnet with their application review and updates today rather than installing a new engine, creating a frightening balance sheet liability," said Stuart McGill, CTO at Micro Focus. "This approach is unlikely to create a fit-for-purpose application portfolio capable of delivering flawless execution of operational services to support business needs every minute of every day."

McGill believes that "over this decade, IT organizations will have to transform from project-obsessed organizations to asset-obsessed ones to derive maximum value from the average 29% of annual IT budgets allocated to operating, sustaining and improving the integrity of mainframe applications and their assets."

"This makes application portfolio management (APM) a strategic imperative," McGill added. "The challenge is that it's difficult to attribute an immediate return on investment to APM given it's a mid- to long- term value proposition, which sits at odds with the way most IT leaders are measured - on how well and how quickly they are reacting to and delivering against short-term changing business demands."