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Security, cost and workforce challenges have states looking to retire, rehost or outsource mainframe operations, according to a survey by the National Association of State Technology Directors.
As states struggle to modernize their legacy systems, most manage their mainframes in-house, even as they work to outsource operations that can’t be retired, replaced or rehosted, according to a recent report.
In a survey released in November by the National Association of State Technology Directors (NASTD), 38 state IT directors submitted responses on their modernization efforts. Just over half indicated that mainframes were their primary focus for legacy system modernization.
The main challenges with legacy applications were related to security, with 16 states ranking security highest, followed by limited or unavailable software maintenance upgrades. Costs in mainframe and data center environments primarily go to software and operations, with only 26% of expenses going to hardware.
The legacy modernization challenge is widely acknowledged inside state government. One state noted in the report is trying to develop a modernization fund outside the biennial budget process, according to its IT director. Another respondent said of legacy modernization: “We’re at the beginning, but with tremendous backing and funding.”
Survey respondents estimated that 44% of current state application portfolios require modernization; three years from now, they estimated that percentage at 25%.
The COVID pandemic accelerated modernization for 84% of respondents. To scale services, 31 states increased the use of cloud, and 28 said they boosted network infrastructure/bandwidth. Others increased compute or storage capacity.
As states transition from legacy to cloud-based systems, employee recruitment and retention were cited as a challenge by 53% of the states. They reported having trouble finding staff that have both legacy and modern skill sets and were looking to contractors and managed service providers to meet that need.
Looking ahead, 27% said they anticipate a fully outsourced approach to mainframe management with only 24% expecting to continue in-house management. Of the other state respondents, 22% predicted managed service off-prem, 16% said they expect a hybrid approach and 11% are moving toward managed service on-prem, the survey found.
“The results illustrate perfectly that state government understands IT modernization is not a ‘once and done’ activity,” said NASTD Research Committee Chair Victoria Wallis, strategic project manager for the Iowa Communications Network. “As soon as the current legacy items are addressed, new ones will take their place in the priority list.”