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Re-Inventing Business with Application Modernization

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With a rapidly changing business environment, organizations have no option but to modernize applications to remain responsive and relevant

Application modernization initiatives witnessed rapid uptake to achieve business continuity during disruptions caused by Covid pandemic. Business embarked on digital delivery of services, re-designed internal systems and processes to offer new services and tweaked existing services to launch new business models, even as they worked towards enabling employees to work remotely in a secure manner.

“Our challenges are typical to any growing organization with business requirements so dynamic that IT landscape has to always be a step ahead to catch up with the changing business landscape, and so digitization is a business priority in Delhivery and the expectations from IT is huge.”

Gaurav Pandey, Head-IT, Delhivery

As things open up and businesses operate in a new normal of hybrid work environment, the role of new technologies such as Cloud, mobile, IoT, AI, automation are increasingly playing a role in business outcomes. But new technologies require an enabling environment to operate and traditional IT environment is not conducive to support new initiatives.  

Organizations are fervently adopting modernization strategies to tap the information, data and assets trapped in siloed and legacy environments, and transport that into modern hyper-scaling environments offered by public Cloud. This is helping organizations to embark on game-changing strategies that are built on a foundation of agile and responsive systems, where decision making based on informed insights and products and services are enhanced with continuous improvements.

The external business environment is extremely dynamic and tech-savvy entrepreneurs are raising the game by disrupting the status quo with new business models leveraging Cloud, open-source technologies and APIs. For example, Orix India, a leasing and transportation solutions provider has launched a new business model by offering cars on subscription in collaboration with automobile majors such as Maruti Suzuki and Tata Motors and retail leasing with Skoda, Volkswagon and Honda.

“We built a modern ERP Cloud-native ERP system with a micro-services architecture, using Kubernetes to achieve agility and innovate frequently. We need to customize offerings for large customers and need to make frequent changes designed exclusively for the customer. For example, the requirements to transport cars and vehicles is very different from transporting mobile phones.”

Kapil Mahajan, CIO, Safexpress

But in the back end it required Orix to hook up with partners to facilitate customers to register, verify credentials and subscribe in a seamless manner—all of which was possible supported by open APIs and Cloud technologies.

Modern applications boost innovation with frequent experimentation and fail-fast strategies. Experimentation has become a crucial ingredient of success and modern application architectures such as microservices, powered by containers and serverless technologies, are equipped with high level of automation, built-in flexibility and scalability to empower businesses with agility.

Putting in place a foundation for agile business has been crucial for survival. Says Gaurav Pandey, Head-IT, Delhivery, “Our challenges are typical to any growing organization with business requirements so dynamic that IT landscape has to always be a step ahead to catch up with the changing business landscape, and so digitization is a business priority in Delhivery and the expectations from IT is huge.”

“With network spread across 400+ locations connecting length and breadth of India, IT is a key business enabler for the success of Delhivery.  With rapid expansion in business, technical imperatives in Delhivery are very dynamic and closely aligned to the business imperatives.”

Gaurav Pandey, Head – IT, Delhivery

Digital is the foundation for New Business Environment

Like Orix, most businesses are turning to a digital medium to facilitate customers. For instance, any retailer worth its name has a digital offering and Good Earth, a high end clothes and lifestyle goods providers with physical and online stores, leaned on its digital presence to get more bang for its bucks. During covid pandemic it achieved more than 100% growth in digital business by leveraging a combination of efforts that included stepping up online initiatives, tighter omnichannel integration and enhancing the mobile experience. 

As a design studio, the physical stores are critical to its strategy to deliver an exclusive customer experience to enable look and feel of products. But as the pandemic caused a steep downfall in customer footfall, digital became critical to ramp up sales by observing digital footprint and deliver a customized experience. 

 A global survey by UNCTAD across 3,700 people in different countries, more than half of the respondents now shop online more frequently and rely on the internet more for news, health-related information and digital entertainment. The report emphasized that the acceleration of online shopping globally underscores the need for ensuring that all countries can seize the opportunities offered by digitalization as the world moves from pandemic response to recovery.

Organizations such as Delhivery which form the backbone of the e-commerce business are on a rapid modernization initiative. “Key IT initiatives identified for the year 2022 include hybrid architecture, SIEM, DLP, wireless revamp and mobile Device Management.”

Similarly Safexpress which caters primarily to the B2B segment, has been on steadily  expanding its IT modernization initiative. Today it has a custom built, Cloud-native, ERP system hosted on AWS Cloud to cater to the exclusive requirements of its customer base.

“Technology is not just an enabler but a participant in increasing customer satisfaction. IOT enablement helps to track throughout transit by scanning the consignment barcode with digital scanners and providing updates to customer in a transparent manner.”

Kapil Mahajan, CIO, Safexpress

Speaking about the initiative, Safexpress CIO, Kapil Mahajan, says, “We built a modern ERP Cloud-native ERP system with a micro-services architecture, using Kubernetes to achieve agility and innovate frequently. We need to customize offerings for large customers and need to make frequent changes designed exclusively for the customer. For example, the requirements to transport cars and vehicles is very different from transporting mobile phones.”

Safexpress delivers to as many as 31,187 pincodes and its fleet of 8000+ trucks travers more than 12,00,000 kms each day carrying a variety of goods from large cars for Tata Motors to small mobile handsets for Samsung. These are high value consignment goods with different sizes and different handling requirements which come with very strict SLAs for time delivery and condition of consignment.

Speed is of essence in the logistics industry and meeting and exceeding SLAs is a competitive edge—not surprising considering logistics is the backbone for many industries such as ecommerce, retail, manufacturing and FMCG. Therefore, Safexpress has a fanatical focus on meeting SLAs.

The company embarked on digitization and IOT enablement to achieve operational efficiency and to meet with SLA. Says Mahajan, “Technology is not just an enabler but a participant in increasing customer satisfaction. IoT enablement enables to track the consignment throughout transit by scanning the consignment barcode with digital scanners and providing updates to customer in a transparent manner.”

Achieving operational efficiency is a key driver for adopting digital and Delhivery’s Gaurav Pandey echoes in similar lines, “Being in the logistics business, mobile computing is an essential component of digitization in Delhivery. Android mobile devices are used across various business functions in Delhivery and mobile apps are integral part of digitization.”

Often application modernization is taken up as a technical project without considering business implications. But more businesses are becoming savvy and understand that only a data-driven strategy which provide insights into operations, security, cost, and usage and blends well with business objectives will help the business to re-invent and deliver transformational benefits.   

Gaurav Pandey sums it up well, “With network spread across 400+ locations connecting length and breadth of India, IT is a key business enabler for the success of Delhivery.  With rapid expansion in business, technical imperatives in Delhivery are very dynamic and closely aligned to the business imperatives.”

Application Modernization is not an option

Businesses with legacy environment are realizing that old IT investments are delivering reduced returns as an increasing proportion of the IT budget are going into improving operations and managing legacy systems than in value creation. One IDC estimate puts the figure of maintaining legacy systems at more than 78% of the IT budget with increasing difficulty in finding replacement hardware, software and people with skill sets to keep the old systems running.

Many legacy applications are custom written in old programming languages which are not compatible with new technologies. It is difficult to maintain as there are hardly any skill sets available and any maintenance patches, updates and new releases require a downtime which is a liability in today’s always-on business environment.

While digital transformation initiatives have been underway, disruptions caused by Covid-19 pandemic has brought in years of change in the way companies operate accelerating digitization. Embracing new technologies including application modernization is not just a business enabler but a differentiator and organizations must invest in smarter technologies to build new capabilities and lead with experimentation and innovation.

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