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What is Mainframe Modernization and What Are Its Key Benefits?

Many mainframes depend on legacy technologies which can be pretty challenging to modernize.
Row of server computers
Published on
April 7, 2022

According to a recent study, 80% of all corporate data today resides or originates from mainframes. Other researchers estimated it at a still impressive 40-50%. Moreover, 70% of Fortune 500 companies use mainframes. Many of those mainframes are based on legacy technologies that present a number of challenges to companies that want to stay on the leading edge of their industries. 

What exactly is mainframe modernization? What benefits does it bring to organizations that decide to update their mainframes? Keep on reading this article to understand the essentials of mainframe modernization and its most important advantages. 

What is mainframe modernization?

The process of modernizing a mainframe aims to improve the organization's existing mainframe footprint in various aspects such as performance, maintainability, interface, and cost. It doesn't always have to take the form of a drastic change, such as replacing legacy mainframe systems with cloud servers. 

When modernizing a mainframe, it's necessary to take a look at the bigger picture because the goal of such a project is mainly achieving a well-connected ecosystem. An organization needs to understand where and how resources will be allocated to create a seamless computer network that integrates all the implementations across the company. 

Modernizing a mainframe system entails the adoption of applicable methodologies, installing modern hardware and software, and developing applications. Most of the time, organizations start their modernization efforts by analyzing what's working well currently and building upon that, improving the existing capabilities, or adding new ones. 

The modernization of systems based on COBOL can today be achieved by integrating them with modern mobile applications and cloud computing platforms. Even if considered by many as a legacy programming language, COBOL applications still power 65% of enterprise software and 70% of business transaction processing globally. Thanks to recent advances in technology, enterprises can easily make COBOL work with JSON, XML, and Java to provide the necessary host-based and data processing mode that mobile applications require. 

Another approach to mainframe modernization is the integration of multiplatform DevOps. To make sure that the mainframe is a vital element in the development and deployment of modern applications and DevOps, it's smart to combine it with a unified development system. As you can see, even today, it's critical to have an IT system and workforce that are mainframe-ready.

3 benefits of mainframe modernization

Mainframe is a system that continues to be used for decades, and it can definitely provide a strong foundation for businesses if they choose to modernize it and prepare it for the future. Having a modernization strategy ensures that the mainframe system is in line with your current business needs. But it brings in so many more benefits. 

1. Modernizing legacy stacks and systems

Back in the day, COBOL was a very common programming language. The majority of applications that are today vital to the government and financial services industry were written in that language. 

However, given today's massive numbers of workloads, these legacy applications are starting to show technical limitations. This makes maintenance a challenge. Organizations can now take advantage of modern APIs to integrate these applications into modern distributed ones. In other words, you can keep your legacy setup but still benefit from the lean approaches of modern solutions. 

2. Cloud integration

Maintaining a mainframe doesn't mean that organizations can't use any cloud-based platforms. By modernizing the mainframe, you can take advantage of the cloud with the help of mainframe architecture. Note that the mainframe is quite similar to the cloud as it includes massive storage and capabilities for workload virtualization. 

3. Smaller MIPS costs

Mainframes are quite expensive to maintain. As your workloads increase, the maintenance costs grow as well. One of the main drivers of these increasing costs is the licensing that specific hardware and software require. By modernizing your mainframe, you can offload these transactions into distributed data fabric to address the issue with MIPS costs. 

Mainframe modernization - key drivers

Cost of maintenance

The monthly license charges and monitoring (not to mention database tools) may increase from 4% to even 10% per year. This puts huge pressure on organizations and their bottom lines. That's why so many companies launch modernization projects today. 

Lack of agility

While some mainframe vendors are now starting to implement DevOps models for software development, most of the products are still based on the Waterfall approach. This means that the time-to-market is significantly longer (and every change of requirements is a problem). 

Skills shortage

As Baby Boomers retire, mainframe system programmers and application developers are in great shortage. Most universities and colleges have dropped mainframe courses from their curricula because it's a legacy technology. Since it has become even more challenging to get the right people with relevant skills, organizations look towards modernization to keep their mainframes going.

What is the hybrid approach to modernizing legacy systems? 

This mainframe modernization approach can address all the key challenges mainframes present without removing all the benefits of retaining mainframe operations. Today, modernizing mainframes can take on three different hybrid approaches that come with different advantages, risks, and costs. 

Here are the most popular hybrid approaches organizations use today. 

Mainframe as a Service (MFaaS)

With this approach, the organization transforms to the pay-per-use model and uses the provider's mainframe hardware, software licenses, disaster recovery, data center operations, and high-availability features. 

Thanks to the flexible pricing, you can pay for MIPS consumed each month and not for the installed MIPS. Since it's the service provider that ultimately hosts the infrastructure and pays for maintenance and upgrades, your organization can reduce downtime risk and costs. 

This is a good approach if your infrastructure becomes too complex and costly to maintain if you're not able to handle peak loads or identify the cause of system problems. 

Managed mainframe services

This approach is a good one for organizations that prefer to own their mainframe software and hardware assets but don't want to address the challenge of managing mainframe operations in-house. This could be due to the lack of critical resources or high costs. 

In such a scenario, it's the vendor's job to perform management of the mainframe infrastructure. If you already have an existing infrastructure, this model offers the flexibility of using the latest technologies as patches and updates. 

The 5R's approach

The third approach is based on 5R's: retire, retain, replace, rehost, and reenvision legacy systems. Mainframe as a Service and managed mainframe services are two basic outsourcing options that organizations can use without impacting or changing their applications. But the 5R's approach is different – it focuses on modernization. 

Just as its name implies, you can choose to retire an existing application, retained and rehost in the cloud environment, replace it with a brand-new application, or completely reenvision it based on the condition of your existing infrastructure.


Mainframe modernization is something every organization with a mainframe should consider if it wants to stay afloat in the rapidly changing business landscape ruled by technology today. However, as with every other form of change, it's smart to approach modernization in phases so that it doesn't become too large of a project. 

Focus on what your organization needs right now and identify the tools required to meet those needs. New technologies should be assessed on a case-by-case basis - not considered as the best solutions by default just because they're new. The modernization process needs to follow the development of the business so that the technology works for you, not the other way around. 

Do you have any questions about mainframe modernization? Are you looking for a reliable partner to help you modernize your mainframe? Get in touch with us

We have years of experience in modernizing the mainframes of top financial services companies and beyond. Our experts have the expertise to help you keep up with the current technologies.

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