IT Modernization leads to revenue growth

IT Modernization Key to Increasing Business Revenue

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Bringing DevOps and ITSM Together - itSMF NZ Conference 2017

Research from Avanade reveals that businesses taking steps to modernize their IT in today’s digital world can expect to increase revenues by an average of 14 percent. In addition, updating and enhancing IT systems and approaches can reduce the cost of business operations by over 13 percent

This study focused on investigating just how closely IT modernization is linked to the success of large organizations and their digital transformation journeys. It looked at key reasons for modernizing and investigated the barriers to doing so. These were the key findings:

  • Conventional IT systems are not fit for purpose – 65 percent of senior IT decision makers believe the typical systems and approaches to IT in use today are not enough to address emerging digital business requirements
  • Modernized IT systems require two different approaches – 93 percent of senior IT decision makers agreed that both a predictable approach to optimizing core systems and an exploratory approach to innovating the business are needed simultaneously.  More than half of all respondents already expect to implement robotic process (56 percent), intelligent (61 percent) or cognitive (59 percent) automation technologies (including AI) in the next three years
  • A cloud-first approach is necessary for a hybrid world – 87 percent of respondents indicated their organizations are planning to implement vendor-provided cloud stacks to integrate their on-premises data center with public cloud. However, almost half are still running the majority of their custom applications on-premise
  • IT benefits alone are not sufficient to justify the business case for modernizing – 93 percent of senior IT decision makers believe that business ROI benefits must be included alongside IT benefits to justify the need for modernization. 87 percent of respondents are convinced that their organization’s executives don’t fully appreciate the potential ROI of IT modernization projects
  • Vendor expertise is key to embracing new technologies, processes and approaches – Senior IT decision-makers recognise the value of getting support from outside expertise, most notably in the areas of modern software engineering (84 percent) and cloud migration (81 percent)

“There is clear consensus that modern software engineering approaches and process automation technologies are key to addressing emerging digital business requirements, and promise huge rewards for businesses equipped to harness their full potential,” says Tyson Hartman, Global Platforms, Services and Offerings Executive at Avanade. “It’s an exciting time for IT decision makers who can champion modernization, articulate the business value and put in place the right skills to implement successfully.”

Find out more about Avanade’s recommendations as outlined in the full report:

  • Make a clear business case for IT modernization, demonstrating the outcomes of increased business productivity, faster time to market and business growth.
  • Modernize to empower two distinct approaches to IT that are required to drive and empower digital transformation.
  • Invest in a cloud strategy that works for your business in order to effectively capitalize on your IT modernization approach.
  • Look for the right partner that has deep technical expertise in the areas you need, business and industry understanding, tools and methodologies.

About the research – 
In February 2017 Avanade commissioned Vanson Bourne to conduct in-depth research among 800 senior decision-makers from the US, Canada, UK, Germany, Italy, Brazil, Japan and Australia. These respondents came from businesses with between 500 and 5,000+ employees, with revenues ranging between $500m to $10b.

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Kirstie Magowan

Kirstie Magowan is the managing editor of IT Chronicles. Kirstie is an experienced journalist and publisher who has been working in the IT Service Management industry since 1999. Kirstie is a regular speaker at industry conferences globally.