2023: The Year of Addressing IT Challenges with Recession-Proof Digital Transformation Solutions

One of the greatest impacts on the way we work in 2023 will be digital transformation. Gartner predicts that companies will increase digital business initiatives in response to economic turmoil. Looking ahead to a potential economic recession, businesses dealing with inflation, staffing challenges and the need to update aging, on-prem equipment are seeking sustainable, cost-effective solutions that will drive long-term innovation and efficiency.

Below are initiatives FNTS executed in 2022 that will pave the way for additional opportunities and growth to address these challenges in 2023:

• Experienced growth across mainframe, IBM Power Systems, FNTS Cloud and Azure managed services segments. This growth is in-line with or outpacing the industry across these various segments.
• Gained team depth and skills to refine our migration, deployment and operational methods to drive cost reduction and create simplicity for clients. By standardizing processes and investing upfront in due diligence and detailed design discussions, we continue to decrease deployment time from over 70 days to under 60 days.
• Expanded our Microsoft partnership and recently achieved new status as a Microsoft Solutions Partner for Modern Work. One of six Microsoft solutions areas that just launched for partners, Modern Work demonstrates our breadth for M365 apps and services that boost productivity as clients shift to a hybrid work environment.
• Added scale and cost efficiency in our IBM platforms.
• Implemented Dell EMC IDPA technology for our backup offering, which enabled us to provide immutable backups for clients, without any additional cost. It has also allowed us to consolidate from several Avamar and Data Domain deployments, simplifying the support of backups. We also have streamlined the patching process through automation.
• Added new self-service tools in ServiceNow that include the self-provisioning of resources.
• Replaced SolarWinds Orion with LogicMonitor, providing our team and clients with better visibility and information around system and network performance.
• Utilized automation to streamline configuration of systems and ensure server hardening and compliance requirements. Hardening, patching and tuning security tools provide better threat awareness and response.
• Identified key criteria of where we want to grow and expand our business by actively pursuing acquisitions.

Now, let’s dive into what we expect to see in 2023.

Mainframe Optimization

Some big-name companies have announced plans to move off the mainframe due to software costs, a lack of available skills to operate or leverage the platform and the desire for workloads to be co-located with other cloud assets. Also, many operators are becoming acutely aware of the risks associated with a retiring workforce that is taking their tribal knowledge on platform operations with them. We find many clients are coming to FNTS to replace lost workforce while they make their mainframe transition to the cloud.

The economies of moving to the cloud have improved along with the migration patterns required to make a successful transition. Cloud ecosystems have been maturing, adding new features and connectivity options, and expanding partners to assist. Additionally, migration partners have enhanced competencies to a point where workload migration is very low risk and a well-choreographed exercise. Having a clear, current and detailed picture of how the mainframe is being used and how it integrates into the broader systems’ architecture is crucial to making a low-risk transition. Historically, the mainframe has been the center of a client's technical strategy and has many integration points. Since mainframes have provided a secure and well-understood access framework for many clients, especially in highly regulated industries, it’s important to carefully assess future state security requirements. Knowing how this will be addressed in the future-state is a key factor in reducing risk.

Easier access to data and less complexity in the overall application and tool architecture are common drivers for a mainframe optimization approach. Many of our FNTS clients have found better use cases or economies for certain workloads that have historically been on the mainframe but can be refactored to private or public cloud environments. This multi-cloud strategy leaves some workloads on the mainframe and then optimizes performance and cost for other workloads. For example, mainframe may be the better price/performance option for workloads that are resource-intense or have high transactional volume.

Many organizations will continue to migrate workloads off the mainframe based on compelling business events or through establishing favorable use cases for change. The ecosystem of migration and managed services partners is growing broader, and the availability of adjacent services for backup and disaster recovery will make further migrations even more compelling for those who haven't made the change yet. We also expect organizations that still wish to retain some mainframe workloads over the mid-to-long term will also accelerate their migration to a managed model to take advantage of reduced capital outlays, cloud-like consumption-based pricing and the ability to exit the data center and its associated costs. In this fashion, clients can capitalize on a multi-cloud strategy and reduce costs to position themselves for greater agility going forward.

Cloud Migration

Further advancement in multi-cloud integration is expected in 2023, along with renewed volume in migration efforts centered around enterprise resource planning. In addition, enterprise automation for operations and more comprehensive cloud security also will be focus areas.

IT leaders who consult with FNTS expect to be tasked with further modernization and transformation objectives, as well as applying post-pandemic successes at greater scale. Most IT leaders, especially in the mid-market, are coming under further pressure to allocate a higher percentage of budget initiatives that drive business outcomes or generate revenue. While large-scale economic forces currently in motion will greatly impact IT decision making, growth in cloud services will largely maintain its present momentum as many organizations will want to limit technology-related capital spending. Most of the CIOs we work with at FNTS feel there is an expectation to deliver operational and cost efficiency alongside innovation and/or modernization, to meet both current and next-wave business demands. Customers with a cost-centric focus will favor MSPs that can help clarify cost optimization strategies and inflation management, as well as deliver flexible pricing and contract models.

Interest in industry verticals continued to grow this past year and will be a continued focus in 2023. Initially, we expect to see more depth than breadth as healthcare and financial services verticals build deeper offerings. Cloud ecosystems tailored to these verticals will have more options for adjacent software services and available APIs, as well as enhanced integration patterns and more holistic security approaches.

Having diverse cloud capabilities allow us to identify the right cloud solution for a client’s specific business needs. Throughout the year, we plan to roll out additional capabilities for Azure and IBM Cloud offerings. With the significant growth of IBM Power business, we are expanding our capabilities for the FNTS Power Cloud and Power Systems Virtual Server. These solutions provide adjacency for organizations running IBM Power Systems and X86 servers.

IT Security

Due to regulatory and compliance needs, and from a desire to better protect operations, many organizations are taking a holistic look at security strategy to protect against ransomware and other threats. Ransomware tools are more sophisticated and can bypass security controls to behave smarter and gain a foothold into an organization.

At FNTS, we are investing in autonomous AI to defend against automated attacks and deception technology to create better visibility around inside threats. We also have been developing new services around immutable backups and air-gapped backups to add further depth to our clients’ security strategies. Immutable backups make it harder for ransomware to encrypt, and air-gapped backups are not connected to a network but can be if needed. Enhancements will drive a better overall security posture and help clients reduce cybersecurity premiums as cyber insurance providers continue changing requirements for customers to require more specific backup and DR solutions. Further capital-avoidance for technologies related to backup, storage and disaster recovery is anticipated as the cost and availability of these solutions “as-a-service” have become easily attainable for mid-market organizations.

Expect further improvements to enterprise security management tools, especially from hyperscale cloud providers like Microsoft. IT and security leaders also will continue to refine work-from-home deployments and security models, now that best practices have surfaced.

Additionally, businesses are under considerable pressure to both rapidly deploy new platform services as well as optimize and create transparency to costs. Our continued user experience investments meet these demands and have even more tightly aligned our teams with our clients.

Lastly, 2023 will likely bring even finer alignment between cybersecurity leaders and their business leadership and boards. With an ever-increasing threat landscape, cybersecurity has become a board-level conversation about assessing readiness, reducing attack surface and managing cyber insurance.

Emerging Tech Trends

Our FNTS teams continually research a wide range of technologies to determine where we can introduce new capabilities that would add value to customers.

• We’ve been identifying solutions in the Azure ecosystem both to accelerate operations and enhance security. We are working to become a Microsoft Solutions Partner for Azure Infrastructure.
• We continue to partner with clients using container and serverless technologies to develop models for future services.
• Expect to see us grow and build scale and capability in our managed services to create value by delivering resilient and secure infrastructure services that reduce operating costs.
• Use cases for artificial intelligence and machine learning are expanding with platforms deploying more pre-built applications. Expect larger organizations to improve models and build upon successful projects.

Client Experience

Organizations are putting greater emphasis on ensuring the client experience is the best that it can be. FNTS is a trusted partner to organizations nationwide by providing ongoing consultation, support and value-added solutions. Below are our commitments to the client experience:

• Continual investments in our infrastructure with life-cycle refreshes and enhancements to our systems, network and storage environments, to improve performance and security. We also continue to invest in our security posture and our ability to extend this to our clients who must achieve regulatory compliance.
• Clients can expect to see a high degree of support and consultative services from FNTS. We invest in tools and provide recommendations on opportunities for improvement and optimization. 
• Enhancements to cross-functional cloud management capabilities from both a skills standpoint and a user experience perspective. New innovations are happening within our customer-facing self-service tools that provide greater visibility, and recommendations to our clients on a regular basis. 
• Operationally, our automation and security initiatives enable us to deliver streamlined deployment for clients, in alignment with regulatory requirements. We are deploying additional automation capabilities, specifically around firewall rules.    
• Through leadership development, investments in our FNTS culture and by implementing standardized toolsets, documentation and proven processes, we can enable our employees to more easily support client initiatives, which is important to us.

If you’d like to receive more information on timely trends and resources to address challenges in your organization, subscribe to our blog or email us at info@fnts.com

FNTS President Kim Whittaker, CTO Ken Marr, Field CTO Chris Williamson and Sr. Director of Information Security Don Pecha contributed insights to this blog.