State, local governments engage providers to
enhance or replace aging systems to improve services, prevent
failures, ISG Provider Lens™ report says
Demand for mainframe services among state and local governments
in the U.S. is higher than ever, because many of these
organizations can no longer wait to modernize their systems,
according to a new research report published today by Information
Services Group (ISG) (Nasdaq: III), a leading global technology
research and advisory firm.
The 2024 ISG Provider Lens™ Mainframes — Services and Solutions
report for the U.S. Public Sector finds agencies are alarmed by
recent mainframe failures in some states. At the same time, their
aging systems need to support new services, while many
hard-to-replace mainframe experts are retiring.
“Mainframe upgrades come with a lot of uncertainties, but the
risks of doing nothing continue to grow,” said Nathan Frey, partner
and lead, ISG Public Sector, for the U.S. “State and local
governments are taking action to prevent catastrophes and prepare
to meet future constituent demands.”
U.S. public-sector demand for mainframe services is rising by as
much as 10 percent to 20 percent, the report says, though growth is
slower in the federal government due to regulatory and security
constraints. By contrast, in the private sector, mainframe services
engagements are growing by 5 percent or less, owing to already
extensive moves to cloud computing.
Like private enterprises, large state and local agencies are
recognizing that mainframes will be part of their IT infrastructure
for the foreseeable future and are exploring hybrid approaches that
integrate legacy systems with the cloud, ISG says. Hybrid
strategies are harder for these organizations to carry out, because
public-sector mainframes have not been updated as often, but
providers are helping agencies close the gap using DevOps
methodologies. Smaller public-sector clients are often choosing to
move away from legacy systems through lift-and-shift
initiatives.
AI is becoming essential to mainframe modernization and
optimization, reducing costs and timelines by automating the
analysis and documentation of legacy code, the report says. AI
tools can recognize the patterns and dependencies in complex
systems, helping IT teams recreate the business logic of mainframe
applications in modern, cloud-based software.
“Public agencies need AI for mainframe analysis more than most,
because their systems are especially complex after decades of
modification,” said Jan Erik Aase, partner and global leader, ISG
Provider Lens Research. “Service providers are helping them take
advantage of these tools.”
Some state and local governments are turning to
mainframe-as-a-service (MFaaS) engagements, allowing a third party
to handle infrastructure and operations, ISG says. MFaaS adoption,
though still in its early stages in the public sector, is less
disruptive than application modernization and allows organizations
to focus on broader digital transformation initiatives.
The report also explores other mainframe trends in the U.S.
public sector, including the growth of mainframe operations
services provided on site and the emerging importance of making
mainframe data available for generative AI (GenAI)
applications.
For more insights into the mainframe challenges faced by state
and local governments, including fixing systems that need to run
constantly and finding service providers that meet regulatory
requirements for operating in the U.S., see the ISG Provider Lens™
Focal Points briefing here.
The 2024 ISG Provider Lens™ Mainframes — Services and Solutions
report for the U.S. Public Sector evaluates the capabilities of 30
providers across four quadrants: Mainframe Optimization Services,
Application Modernization Services, Mainframe as a Service (MFaaS)
and Mainframe Operations.
The report names Ensono, Kyndryl, TCS and Wipro as Leaders in
three quadrants each. It names Capgemini, DXC Technology, Infosys
and Unisys as Leaders in two quadrants each. Accenture, Avanade
(Asysco), HCLTech and Tech Mahindra are named as Leaders in one
quadrant each.
In addition, FNTS and Wipro are named as Rising Stars —
companies with a “promising portfolio” and “high future potential”
by ISG’s definition — in one quadrant each.
A customized version of the report is available from FNTS.
In the area of customer experience, HCLTech is named the global
ISG CX Star Performer for 2024 among mainframe service and solution
providers. HCLTech earned the highest customer satisfaction scores
in ISG's Voice of the Customer survey, which is part of the ISG
Star of Excellence™ program, the premier quality recognition for
the technology and business services industry.
The 2024 ISG Provider Lens™ Mainframes — Services and Solutions
report for the U.S. Public Sector is available to subscribers or
for one-time purchase on this webpage.
About ISG Provider Lens™ Research
The ISG Provider Lens™ Quadrant research series is the only
service provider evaluation of its kind to combine empirical,
data-driven research and market analysis with the real-world
experience and observations of ISG's global advisory team.
Enterprises will find a wealth of detailed data and market analysis
to help guide their selection of appropriate sourcing partners,
while ISG advisors use the reports to validate their own market
knowledge and make recommendations to ISG's enterprise clients. The
research currently covers providers offering their services
globally, across Europe, as well as in the U.S., Canada, Brazil,
the U.K., France, Benelux, Germany, Switzerland, the Nordics,
Australia and Singapore/Malaysia, with additional markets to be
added in the future. For more information about ISG Provider Lens
research, please visit this webpage.
About ISG
ISG (Information Services Group) (Nasdaq: III) is a leading
global technology research and advisory firm. A trusted business
partner to more than 900 clients, including more than 75 of the
world’s top 100 enterprises, ISG is committed to helping
corporations, public sector organizations, and service and
technology providers achieve operational excellence and faster
growth. The firm specializes in digital transformation services,
including AI and automation, cloud and data analytics; sourcing
advisory; managed governance and risk services; network carrier
services; strategy and operations design; change management; market
intelligence and technology research and analysis. Founded in 2006,
and based in Stamford, Conn., ISG employs more than 1,600
digital-ready professionals operating in more than 20 countries—a
global team known for its innovative thinking, market influence,
deep industry and technology expertise, and world-class research
and analytical capabilities based on the industry’s most
comprehensive marketplace data. For more information, visit
www.isg-one.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20240418769717/en/
Press Contacts:
Will Thoretz, ISG +1 203 517 3119 will.thoretz@isg-one.com
Julianna Sheridan, Matter Communications for ISG +1 978-518-4520
isg@matternow.com
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