{"id":5005,"date":"2022-02-24T04:32:00","date_gmt":"2022-02-24T04:32:00","guid":{"rendered":"https:\/\/test.horsesforsources.com\/2022-hfs-app-modernization-top-10_022422\/"},"modified":"2022-04-26T17:16:28","modified_gmt":"2022-04-26T17:16:28","slug":"2022-hfs-app-modernization-top-10_022422","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/2022-hfs-app-modernization-top-10_022422\/","title":{"rendered":"Cognizant, Infosys, Accenture, IBM, and EY electrify the HFS Application Modernization Services Top 10"},"content":{"rendered":"

As services firms secure a new digital future, leading the journey to cloud-native for many firms is the need to modernize the vast number of applications across their technology and business silos.<\/p>\n

While application modernization is commonplace as systems constantly need to be upgraded or migrated to newer solutions, data from our HFS’s Pulse survey<\/a> of Global 2000 firms’ investment in microservices is increasing by over 40%.<\/p>\n

As part of our application modernization services research, we interviewed 17 services providers and 50 enterprises about their efforts to rehost, re-factor, re-architect, replace, and retire legacy applications. Key learnings included:<\/p>\n

Funding is coming from the business <\/strong>As a result, the business is driving (and funding!) the vast majority of modernization efforts;<\/p>\n

Access to talent is the most significant limiting factor<\/strong> There is a battle for talent as enterprise and services providers struggle to recruit, develop, and retain the cloud-centric development skills needed for microservices, Kubernetes, Docker, and serverless software architectures;<\/p>\n

All in on the cloud <\/strong>Hybrid cloud is the preferred platform for developing these solutions; this has triggered additional needs across infrastructure planning, technology architecture strategies, data management, and security.<\/p>\n

Services providers are seeing traditional outsourcing revenues stagnate as digital revenues increase dramatically. Global stalwarts are reporting a rise in digital revenues in their financial filings, attributing to 20-40% of revenues now attributed to digital and new business opportunities in their pipelines of 60-80% of projects being digital. Meanwhile, formidable challengers like Hexaware, Mphasis, and Virtusa are reporting digital making up 70% or more of their revenues.<\/p>\n

These are all being driven by digital.<\/strong><\/p>\n

The journey to cloud-native is here. Services providers boost their Agile practices<\/a>, acquire firms with deep experience with hyperscalers and cloud-first development, and modernize their DevSecOps teams to deliver microservices, edge, and serverless computing technologies.<\/p>\n

The modernization of applications also means significant investments in modernizing enterprise data strategies. As applications are connecting with new data solutions from Amazon’s AWS (RDS) or Google’s Cloud Big Data, we also see growth in NoSQL solutions and cloud-native SQL’esque solutions from Couchbase MongoDB and others.<\/p>\n

You can (but you shouldn’t!!!)<\/u> modernize your applications without modernizing your data.<\/strong><\/p>\n

To this end, we have published the Top 10 Applications Modernization Services<\/a><\/em> report and its companion Formidable Challengers: Applications Modernization Services<\/a><\/em>. These reports delve deeply into how 17 services providers bring sophisticated practices that bring people, technology, skills, partnerships, and innovation to market. <\/p>\n

I sat down with Joel Martin<\/a>, our Research Leader for Cloud, SaaS, and applications at HFS, to learn about the experiences and insights from this new research.<\/p>\n

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Click to Enlarge<\/a><\/em><\/p>\n

To download a copy of the report, please click here<\/a>.<\/strong><\/p>\n

Phil Fersht, CEO and Chief Analyst, HFS Research: <\/strong>The 2022 HFS Application Modernization Services Top 10 provides a comprehensive look at the practices leading services companies are bringing to market. Joel, what changes or shifts did the pandemic put in motion?<\/span><\/p>\n

Joel Martin, Research Leader, HFS Research: <\/strong>Thanks, Phil. With the switch to virtual, there is a bigger than ever expected for technology to deliver value for the business.  In 2021, we saw a surge in applications modernization efforts funded by the business unit and directly tied to measurable outcomes. The positive result is that technology departments are thinking more like the business regarding how products (or services) lead to top-line growth or bottom-line efficiencies. Thus, the way they have engaged with their partners, the services provider we profile in this report, is also changing. This was reflected in our engagements with both parties in the way they set goals brought in “squads of teams from the business, partner, and technology groups” to co-innovate and co-develop solutions. I also saw how pricing models are changing to reflect the client’s desire for their technology or applications development partner to commit to the outcome or output-based pricing. More often than not, the client said, “if you want to win my business, you need to put some damn skin in the game as well!”.<\/p>\n

The second big topic is the war for talent. The best talent is becoming very mercenary. Suppose you need Kubernetes experts good luck finding them or keeping them. Enterprises are investing in full-stack development teams and guarding them against other firms, software vendors, hyperscalers, and services firms that are all looking for skilled individuals. Services firms have excited their certification programs and training by partnering with universities and actively acquiring smaller firms with skills in cloud, apps, and data. A case in point is how aggressive Accenture’s efforts have been in 2021 towards acquiring over 20 firms in this area!<\/p>\n

Phil: <\/strong>What should enterprise leaders take away from this research, Joel?<\/span><\/p>\n

Joel: <\/strong>Business leaders should take away the simple fact that modernization will improve their team’s ability to deliver results. They don’t need to go out to get their software because their technology teams are too busy fixing legacy solutions. Instead, the efforts of technology teams and partners to enable a largely virtualized workforce have sharpened their perspective on what teams need to deliver the services people need to provide what a customer is ready to pay for. I heard multiple stories about how technology and business became a lot closer in the past two years than in the previous decade. <\/p>\n

On the other hand, technology leaders can look to the research to guide their opinions on the skills, domain expertise, and partnerships that these services firms bring to the market. We have collected some great insights into how these firms can execute, innovate, and help break down business processes and technology workloads based on customer case studies and interviews we conducted as part of this research.<\/p>\n

Phil: <\/strong>So, Joel, who are the service providers are at the top of the list, and why are they there?<\/span><\/p>\n

Joel: <\/strong>We had a very competitive market where skills and innovation are in high demand. However, after reviewing RFIs, talking to enterprise customers, and multiple vendor briefings, Cognizant, Infosys, Accenture, IBM, and EY came out as our Top 5. <\/p>\n