Are you delivering systems of trust this holiday season?

Retailers: Here’s one less thing to worry about during the IT freeze period

Despite the fast and furious introduction of cloud services, the mainframe has held steady as an integral part of retailers’ hybrid data center. Brick-and-mortar retailers (like Macy’s, Walmart, and H&M) that rely on mainframe technology understand that it’s crucial they keep the customer trust they spend decades building as they expand into the digital marketplace.

Behind the scenes, the mainframe is mission essential, powering 18 of the top 25 retailers’ data centers and storing 71% of corporate data. There’s a reason for that: IBM’s latest model can power 12 billion encrypted transactions per day.  And, it runs pervasive encryption – at cloud scale – 18x faster and at just 5% of the cost of x86 systems. In addition to supporting thousands of transactions, mainframes efficiently store data and connect to devices simultaneously for thousands of users.

As any retailer will admit, this kind of reliability is never more crucial than starting on Black Friday through New Year’s day, when payment transactions (that run through mainframes) are at their apex: IBM Z is used across 87% of all credit card transactions and nearly $8 trillion payments a year. If your leadership hasn’t always understood the value of mainframe in their environment, consider these key benefits.

#1: More Uptime.

Internet traffic levels are steadily increasing, and each year at least one retailer experiences an outage. In 2016, it was Guess, Victoria’s Secret and Express, among other household names. The years before that, Neiman Marcus and Best Buy were just two of the premier retailers that lost business to down time or dramatically slower processing speeds. (One retailer lost more than $1.3M because of a 0.4 second slow-down during a holiday weekend.)

Reducing downtime is important when you’re processing millions of transactions during the holidays, so consider that the mainframe runs 99.999% of the time compared to the cloud’s uptime of 99.5%. That may sound like a negligible difference, but do the math: downtime can cost more than $1M per hour. For a bank with a revenue of $300 billion, that 1.15% equates to a potential $20M in lost revenue. By implementing a mainframe operations intelligence solution that uses predictive analytics and machine learning, businesses can avoid problems before they even happen.

 

#2: Lower Cost.

CEOs and CTOs love to hear “savings,” but they don’t often associate this with mainframe. Why? The platform’s annual total cost per installed MIPS has steadily decreased from $5,517 to $3,057 in the last five years. This is because comparable distributed systems typically drive the need for more expensive hardware, “active-active” infrastructure and rigorous testing and validation. While startup costs for cloud are cheaper up front, in the long term, security and data movement costs will offset those initial savings.

One of CA’s customers, a “top ten” retailer, saved more than $1M in IT operations cost annually after consolidating their software tools, and did so in under 90 days—a good example of the additional ways businesses can save on costs while also maximizing superior platform performance.

On average, according to IDC, Connected Mainframe adopters are realizing a 300% ROI, a 10 month payback and additional $200M in application revenue. And, the five-year operations cost was 47% lower than a distributed environment, a 27% reduction in licensing costs, $30M in business productivity gains and $18M in infrastructure cost reduction—per organization.

 

#3: Faster response.

Teams with slow-to-respond systems should dread the angry customer backlash on social media, quickly taking the problem from the IT back office to the frontline world of crisis PR. When looking at the consequences, numbers don’t lie: more than half of consumers said they would never use a company again after a poor customer experience, resulting in an annual loss of $83B for U.S. businesses. To get a faster response and resolution time, you need to break down the silos with tools that help your team work together. This mobile to mainframe approach is something CA has pioneered.

The key to speed is total visibility and an established, streamlined process that prevents problems before they happen, and to triage by mixing collaboration, automation and operational intelligence when problems do happen. CA has seen that organizations employing agility and DevOps across the enterprise–inclusive of mainframe apps–see process implementation time reduce from months to weeks, achieving a potential 3x increase in release frequency.

 

#4: Stronger security.

Hackers come out on high traffic days such as Cyber Monday, using ever more sophisticated methods to acquire consumers’ sensitive data. To boot, governing bodies are imposing strict compliance laws on use and protection.

Mainframe offers businesses the most secure platform with pervasive encryption, as well as granular control over access permissions (which is important given that 59% of employees steal confidential company information when they leave). As of now, there has been just one public breach involving the mainframe, at Logica, a Swedish IT firm. In contrast there have been thousands of breaches of other types of platforms. The reason for the difference, is that mainframes can protect data throughout the data lifecycle and offer different levels of isolation across the application and OS stack. This is simply not available on enterprise systems, where copies of corporate data may be scattered.

 

Lessons at the Check Out Cart

Companies face many vulnerabilities during the holiday season, but more importantly they need to focus on available solutions that ensure a smooth shopping experience for everyone, at all times. The modern mainframe is one of them, and is an unrivaled a critical component that offers mission essential services with the agility, dependability and security demanded by business leaders, and ultimately, by end users.


Ashok is General Manager of Mainframe at CA Technologies where he's responsible for the P&L,…

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