Staff at Arriva London bus garages have the very latest IBM hardware and Windows software, but they still use green-on-black text screens dating back to when their applications were developed 18 years ago. "Windows screens raised a retraining issue and were unnecessary because users mainly do data entry," says IT manager Alan...
Ricot. Arriva's approach to updating systems highlights the range of options facing IT departments as they get to grips with technology progress and expanding business demands - and get shoved along by suppliers no longer wanting to support old hardware and software. Users and consultancies are clear on the basic options for moving to new hardware or modernising applications: * Rewriting software from scratch * Converting old applications for new operating systems * Getting software packages to replace systems developed in-house * Contracting out all or some of the IT to a services company. But the options are complicated by the availability of software products that put a web front-end on old Cobol batch systems; or products that integrate old applications, files and databases so they can pretend to be SAP; or emulators that allow old applications to think that Windows on an Intel processor is really VMS on an ancient DEC machine. There is a ready market for these extra options: many organisations are reluctant to go for wholesale replacement of software that has proven its reliability over a long period. "ICL introduced its VME operating system in the 1970s with the 2900 mainframe range, and some users' current application software dates back to then," says Harold Cloutt, chairman of Axis, formerly the ICL Association of Mainframe System Users until the UK's main computer company disappeared into Fujitsu. "Axis is having a VME 30th year anniversary conference in April and Fujitsu is supporting some versions until 2021. It does not expect to get new customers, but it knows there are some very big existing users with stable applications. VME is still being enhanced for these users - for example, it now has TCP/IP support built in." The number of such users across all suppliers is large. The average age of core business applications is 15 years, according to UK research by application management specialist HAL Knowledge Solutions. Nearly 30% of organisations are maintaining software that is more than 20 years old. Research firm Omniboss says 86% of UK companies view legacy systems as critical to customer service. It defines legacy systems as "those inherited from languages, platforms and techniques used before the introduction of current technology". The feasibility of moving such systems forward rather than replacing them is explored by Neil Allcock, a partner in the technology practice of consultancy Deloitte. "The main drivers are a desire to integrate all the data and the SAP phenomenon," he says. "Some companies look at replacing their billing systems and integrating them into customer relationship management, but then they find billing is the crux of their business and works well. So instead they get in a datawarehouse to analyse the billing data and do CRM that way." Allcock points to a company that started looking at the options after big growth. "Applications were creaking, so they prepared a big change programme," he says. "Meanwhile they had to keep the existing systems going, so they brought in software engineers and database specialists, and in six months they cured the problems with the existing systems. "A well-tuned hierarchical database is probably still at least as fast as a modern system, and C or C++ code is faster than Java, so there is often nothing that some tuning will not cure. "Data integration can be done in various ways: you do not always need to replace everything. It is easy to write software to sit on top of the old systems to give an integrated view of data and a new look and feel to applications." Allcock says such options are leading many organisations to take a wider view of their IT when looking at updating it. "Companies used to see a software package as the cure-all, but many now look at their overall IT architecture instead," he says. "Understand what you have already got. In particular make sure the data layer is right then migrate the applications - if you find you still need to." Allcock says if companies do move to new systems there are often still some vital old programs they do not dare touch, such as a goods distribution calculator or service scheduler. "If you are migrating your accounting systems you can go to any package, but some programs at the heart of the business are well established and too risky to touch," he says. Cloutt says this situation could bring the outsourcing issue to a head for some companies. "Many do not want to support bespoke systems any more, and this is the time they look at outsourcing their core bespoke applications and move to packages for the rest," he says. User companies and IT suppliers say the benefits of migrating systems to new hardware instead of replacing them include end-user familiarity, no retraining and no change to working practices; continued operation of stable systems; IT staff familiarity with the source code; and possibly minimal changes to software licences, fees and support arrangements, as long as suppliers continue with these. Overall these issues have a minimal effect on the business. Migration with some modernisation can give end-users more friendly Windows screens, faster systems - if the software and databases are tuned up - and more potential business exploitation of data if some integration is done.
Migration can also mean moving the applications to new kit to run under an emulator for the old operating system.
Alun Rogers, principal consultant at systems company Lynx Technology, knows of at least one very big organisation which runs its old core applications on modern equipment which the software still thinks is a DEC Vax computer. Even so, he believes this is just putting off the inevitable.
"One day the application will need decommissioning," he says. "If you just move your applications across you miss out on functions: if you tweak a DEC Vax application to Microsoft .net you miss out on a lot of the .net features.
"You are making a capital investment, so make the most of it. There is the argument about user familiarity but the decision must be based on overall business value."
Others share this view, and say that despite a possible retraining need, modern systems are easier to use than traditional systems, have more features, can be used across more hardware products thanks to ad hoc standards such as Windows and Unix, and tend not to face the imminent risk of support being withdrawn.
But the main reason for total change is simply that old systems have had it, according to Jost Hoppermann, a vice-president at Forrester Research, who has recently produced two study reports on IT in banking.
"Many organisations have a patchwork of systems that are just short of being maintained to death," he says.
"Banks, for example, want to lower costs by migrating to customer self-service and other channels. They want applications to help grow existing customer revenues, acquire new customers, improve the customer's experience and improve customer risk scoring.
But in many cases the IT architecture has evolved out of traditional core systems over time rather than being holistically planned.
"Insufficient agility increases the time to market, for example, because a new business requirement demands changes to many systems in the patchwork. It drives up maintenance and operations costs. And it reduces quality, for example, if the choice is between getting important new functionality late or accepting poor quality new software earlier."
Like others, Hoppermann suggests that some systems can be replaced simply by packages. Companies should "avoid wasting resources on implementing bread-and-butter systems in-house" and focus their IT skills on applications that give competitive advantage.
This skills issue often comes up in migration discussions. "ICL VME skills are thin on the ground and the people with them are typically in their 40s and 50s," says Cloutt. "This is an issue, as Fujitsu is supporting VME for another 16 years.
"Options include outsourcing support, but suppliers face the same skills issues; they could train younger staff or newcomers, but would they be interested?"
Allcock agrees, and adds that companies could end up trying to maintain old and new skills side by side. There is also a risk younger staff will seek new jobs at sites using modern software.
A final word comes from Richard Woolridge, manager of software services company ASG. "System modernisation is not a one-time fix but a continuing managed effort. The reasons for it will not go away; they will only change. Whatever technology you implement today will be replaced by another, and the business environment will change quickly too."
Arriva London has run Cobol systems for bus and crew management on Hewlett-Packard equipment since the late 1980s, but needed a rethink when the manufacturer said support for its e3000 machine would end in 2006.
Arriva's 15 garages each have up to 20 terminals linked to a central machine.
"We looked at a specialist package, but it would have meant retraining and more staff because it did not automate so many functions," says IT manager Alan Ricot.
Arriva migrated its existing systems to an IBM xSeries 255 mid-range Intel machine, Windows Server 2003 and a SQL Server 2000 database, which is easier to interrogate, Ricot says.
Arriva considered Windows for end-users, but retraining was an issue, so it transferred the traditional green-on-black screens to the new IBM PCs, which work as dumb terminals. IT staff had one week's training on SQL Server.
Hewlett-Packard finance and stock control systems are being replaced with Oracle packages.
Arriva used migration software from Transoft and support from services group Capgemini.
"We cleaned up the code and data while migrating," Ricot says. "We did a lot by hand, using Transoft tools and HP query tools. There were a few little funnies when we went live, but overall it was fairly painless."
Benefits include reduced costs: the HP e3000 cost £80,000 four years ago and the new IBM machine was £10,000.