The retail industry is in the midst of the most tumultuous period in its history. Many iconic brick-and-mortar brands are fighting for survival, trying to pivot to a more agile way of operating to compete with more nimble online retailers. They are also struggling to deliver the experiences that meet changing customer expectations. Meanwhile web-based retailers are experimenting with faster and better product delivery and other concepts designed to address the fact that they can’t offer the instant gratification that in-store purchases offer.
The magic words in retail—other than “Black Friday”—are “omnichannel experience.” Merging online and offline businesses can result in sales that are five times higher than those with only an online presence. However, as you know well, this is easier said than done. Let’s look at a few of the barriers to delivering an omnichannel experience and how they can be addressed.
If your retail company has been around for several decades or more, it’s been using the mainframe to process transactions, support POS, and keep track of inventory. This worked well in the past. But, as the years have marched on, your mainframe has had to meet new types of demands, such as the performance expectations of tech savvy and mobile customers. In addition, because the mainframe is a closed environment, it is difficult to implement reward programs based on customer behavior, personalize offers, enable instant credit, and create and maintain massive online marketplaces.
The mainframe was designed to process straightforward transactions and store the data retailers needed to do business in the past. However, delivering applications and experiences that today’s customers demand is beyond the power of many of the programs written in COBOL. Plus, the big data these new kinds of apps need to access puts an even bigger strain on IT teams and budgets. Global retail IT spend is predicted to top $203 billion by the end of this year, but conservative estimates are that at least 40% of retail IT budgets are spent on just keeping the mainframe running.
Basically, fixing, updating, and patching your mainframe can quickly drain your resources and slow the performance of your retail applications and transaction processing. The talent pool with mainframe and COBOL experience is shrinking as younger resources tend to focus on more modern engineering techniques and languages such as mobile app development, R, Python, and more. At the same time, simply casting your mainframe aside in favor of starting from scratch is not only wasteful, but it doesn’t make sense.
So, what can deliver a lower-cost, more manageable environment without rewriting, losing your business logic or impacting users? The answer is mainframe rehosting.
Rehosting, sometimes referred to as “lift and shift,” moves your mainframe assets to the public or private cloud quickly and with minimal risk. Your applications work as-is with no changes to the underlying business logic or user interface. Not only are there cost savings, but you also gain greater flexibility and can better address peak workloads caused by events like Black Friday.
Mainframe rehosting makes it easier to drive and deliver the instantaneous, highly personalized experiences customers expect. Because the operating systems in rehosting are open, they integrate with the new technology required to achieve a competitive edge in the retail marketplace. There is no negative impact on the enterprise or on the measures you have in place to address data security, and it requires minimal training.
For example, a U.S. retailer that was running 10 core business systems (9500 MIPS) on a mainframe, opted for a "lift and shift" rehosting solution for its IMS applications. These core applications were migrated off an IBM mainframe to a private Linux cloud environment. In just 12 months, the retailer has a lower-cost, more manageable environment. The benefits were a reduction in TCO, a 50% reduction in costs, and an increase in ROI when compared to the mainframe environment. In addition, the applications that were moved interact seamlessly with the mainframe DB2, and the administrators are adapting to the open system environment.
Another major U.S. retailer that offers a highly diverse selection of products recently rehosted all of its legacy applications in the cloud. The company now has the infrastructure for innovation and business agility. After the rehosting, two of the company’s developers were able to build a mobile app for purchasing products over the web in just six hours. In addition, the company reports a 60% reduction in costs, online performance improvement of almost 30%, higher availability and reliability of its applications, and transaction processing uptime of more than 99%.
These are just two examples of how rehosting can breathe new life into core systems, delivering high performance, reliability, scalability, elasticity, and available while making it easier to create innovative solutions that delight customers.
Rehosting your mainframe will remove a number of obstacles to delivering omnichannel experiences to consumers. To learn more, visit TmaxSoft | OpenFrame.
Paul Bengtson is the Vice President of Sales for TmaxSoft. He has spent more than 20 years selling technology in segments as diverse as big data, analytics, ERP, cloud and SaaS. Paul joined TmaxSoft in 2016 from EFI where he was Sales Director for its ERP solutions. He also has held senior leadership positions with Radius Solutions, where he was VP of North American Sales, and with Misomex, Artwork Systems (now Esko) and Ace Hardware. Paul has a BS in MIS from the University of Iowa and an MBA in MIS from Benedictine University.