More than 50 percent of mission critical legacy applications in the UK are set for modernization or retirement by 2008, presenting an immediate challenge for IT strategy, according to a research report published this week.  The Applications Intelligence Survey 2004, published by Hal Knowledge Solutions, provides a snapshot of the challenges faced by organizations struggling to maintain legacy application infrastructures.  With 60 percent of high priority applications running on legacy architectures, the pressure to maintain and support the systems is increasing, as business drivers force dramatic IT change.

The survey, which petitioned 100 IT directors from major enterprises on a number of issues facing legacy applications management, found that:

  • 78 percent of companies will retire parts of existing infrastructure by 2008 - the average amount of replacement being estimated at 34 percent.
  • An additional 33 percent of IT infrastructure is scheduled for modernization.
  • 64 percent of legacy infrastructure performs a mission critical function directly related to finance and corporate accounting.
  • 40 percent of IT resources are dedicated to maintaining and supporting legacy applications.

The survey shows that large organizations are now having to respond to a number of business drivers, including IT/business alignment, compliance and outsourcing, to deliver on corporate strategy.  This requires a gear change in how large IT systems are managed and accounted for.  With some legacy applications being up to 25 years old, the complex applications evolution has created a jungle of mainframe and distributed network activity that presents big challenges for applications management.  At least 60 percent of IT directors in the survey agree that:

  • Applications management is becoming more complex, creating a burden on IT resources.
  • An enterprise-wide view of legacy applications would be of strategic value to the business.
  • Increased efficiency in applications portfolio management would reduce IT costs.

Forrester Research analyst, Phil Murphy, wrote that, "The application portfolio management market space will grow from approximately $15 million in 2003 to exceed $400 million by 2008. Too valuable to eliminate, too costly, complex, and interdependent to replace, existing IT applications consume a staggering 73 percent of application budgets. Organizations are embracing APM because it develops fact-based application metrics to drive intelligent decisions, aligns application strategies to business strategies, and increases maintenance productivity." (Application Portfolio Management Tools, Forrester Research, Inc., April 2004.)

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