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The Business Value of the Transformative IBM Z Platform

The IBM Z platform supports tools and capabilities for digital transformation.

Info-graph showing four examples of the financial benefits of the IBM Z platform on a black background.

*All illustrated statistics came from the IDC whitepaper, sponsored by IBM and Broadcom, titled “The Business Value of the Transformative Mainframe”,

Your customers require you to provide digital products and services in an always-on environment. This, in turn, drives the need for digital transformation. Digital transformation is about more than integrating new technology capabilities. It’s about rethinking your old operating models, experimenting and becoming Agile in responding to the market. It’s a state of mind as much as a specific technology solution.

Bearing this in mind, International Data Corporation (IDC), the premier global provider of advisory services and market intelligence for IT, telecommunications and consumer technology markets, recently interviewed 11 IBM Z® clients who have undergone this transformation. IDC quantified the benefits of their efforts in its whitepaper, sponsored by Broadcom and IBM, “The Business Value of the Transformative Mainframe." The results: Organizations that invest in modernizing their mainframe environment are reaping major benefits. This includes an average annual gain of $194 million in business revenue, $2.9 million in savings per mainframe over five years and a 30% decrease in full-time equivalent (FTE) needed for systems management.1 Let’s examine some approaches and processes that can drive digital transformation and see how the IBM Z platform enables them.

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“Exposing their IBM Z assets to create a new experience for customers based on what’s already there is a low-cost, low-risk way for our clients to start their transformation.”
Barry Baker, vice president of software, IBM Z

Build and Deploy Anywhere With Hybrid Cloud

According to Peter Rutten, one of the IDC authors of the paper, “The move to hybrid cloud is the most important factor mainframe clients should consider. Migration off the platform peaked several years ago. Moving to the cloud no longer means moving off of the mainframe.” To enable hybrid cloud, development must be deployment agnostic and able to function across public and private clouds. IBM Z clients in the study are using APIs, microservices and containers to enable development of applications for cross-platform use. IBM Z clients can now extend IBM Z SLAs to the cloud, increasing performance, data protection and privacy, and resiliency to industry-leading levels previously limited to the IBM Z platform.

Barry Baker, vice president of software, IBM Z, shares that the use of APIs is generally the first step IBM Z clients take to extend their high-value applications and data to new services. “Exposing their IBM Z assets to create a new experience for customers based on what’s already there is a low-cost, low-risk way for our clients to start their transformation,” he says.

Break Down Silos and Adopt Agile Development

Breaking down silos in development teams is another important step for successful digital transformation. For IBM Z clients, that involves integrating distributed and mainframe teams into a single team, as well as adopting Agile development methods. “It’s not about siloing off IBM Z from the rest of the organization—but about working together to drive development differently,” Rutten says. Part of what hindered this before was the difference in development skills needed. But this is no longer the case as the IBM Z platform now leverages commonly used tools and technology. 

Mike Perera, vice president of software sales, IBM Z, shares an example of an organization’s transformation in six months from traditional waterfall development to self-service continuous delivery. “A market-leading client staffed a small incubator team that put together an end-to-end continuous delivery model over the course of four months,” he says. “They started with one application, extended to seven applications and now they have it up and running and have disbanded the incubator team because it’s a self-service model.”

Digital transformation requires reimagining how IT is integrated into your organization. Open, proprietary tools can help you break down silos and smoothly integrate your teams to effectively work together—and the IBM Z platform can improve development processes for these tools.

Open Versus Proprietary Tools

In addition to adopting Agile development methods, IBM Z clients interviewed have adopted Linux® and open-source technologies together with commonly used development tools and languages. This helps them keep up with customer demand for more frequent releases and updates to applications and features. Baker tells us that clients often take this step after API enablement. Clients interviewed that had implemented open-source technologies increased development productivity by 17%, increased code releases by 64% and developed 112% more new features at a faster cadence.2 IBM Z now includes a cloud native ecosystem with Kubernetes and containers requiring no Z-platform-specific development skills, making it possible for clients to hire new talent with little or no specialized mainframe development skills. 

In addition, the open-source project Zowe™ has created new opportunities to use modern interfaces to interact with IBM z/OS® with plug-ins and extensions created by third-party vendors and by IBM’s clients. Red Hat® OpenShift® on IBM Z extends those capabilities with integrated tooling and a feature-rich ecosystem.

Support Core and New Workloads

Any IT system transformation must support mission-critical workloads as well as emerging new workloads. IBM Z clients know they can count on the IBM Z platform supporting core workloads. More recent IBM Z features, such as RESTful APIs and z/OS Container Extensions (ibm.co/2wJCYbe), support emerging workloads as well. These features enable integration of core data and applications with the cloud as well as easy creation of new applications with cloud native development capabilities. Clients interviewed as part of the study are seeing annual growth of $194 million in revenue from existing and new business.3

Ease of creating new applications and services is only one requirement for new workloads. System performance and the capability to scale and grow is also critical. With the capability to run up to 19 billion fully encrypted transactions, the IBM z15™ provides the exceptional performance and growth opportunities needed for digital transformation.4 Analytics capabilities also play a heavy role in powering the business.

Perera stated that with so much of the world’s data residing on the IBM Z platform, many clients are starting to leverage machine learning to extract the value of that data quickly and efficiently.

“The move to hybrid cloud is the most important factor mainframe clients should consider. Migration off the platform peaked several years ago. Moving to the cloud no longer means moving off of the mainframe.”
Peter Rutten, one of the IDC authors of “The Business Value of the Transformative Mainframe"

Driving Cost and Operational Efficiency

Finally, organizations expect to drive cost down and operational efficiency up with digital transformation. And that’s just what IBM Z clients interviewed found when they invested in new IBM Z hardware and software. They saved on average $2.9 million per mainframe per year, reducing MIPS usage by 19% and hardware and licensing costs by 14%.5 

IBM Tailored Fit Pricing helps drive pricing efficiencies and enables clients to choose either a cloud-like consumption or a full-capacity licensing model. Perera shares that the criteria for Tailored Fit Pricing was to be simple, predictable and transparent. Clients can take advantage of economies of scale and have line of sight to what it will cost per unit of compute.

In addition, IBM Z clients can now reduce floor space required for their platform footprint while reducing power consumption up to 40%6 with the 19-inch form factor that slots into the standard data center rack.

Propel Your Digital Transformation With IBM Z

Organizations like yours are looking to leverage their IBM Z technology investment to become more integrated, open and flexible across their IT infrastructure. By doing so, you can achieve optimal service levels for new workloads as well as mission-critical ones.

IBM Z modernization offers a 6:1 benefits to costs ratio,7 ultimately providing significant competitive advantage by spurring your digital transformation. 

1. IDC Business Value White Paper, co-sponsored by IBM and Broadcom, The Business Value of the Transformative Mainframe, August 2019. Disclaimer: IDC interviewed companies with significant mainframe investments—large firms with over 87,000 employees on average and revenues in the tens of billions. Detailed substantiation for calculations included as part of the IDC white paper.

2. IBID, August 2019.

3. IBID, August 2019.

4. Disclaimer: This transaction rate is based on internal measurements of a z15 configuration consisting of 2 8-way LPARs and a 4-way ICF running with dataset encryption and CF encryption enabled. Using these results, full size z15 transaction rates were projected using standard LSPR MIPS. The performance that any user will experience may vary.

5. IBID, August 2019.

6. A single-frame z15 saves up to 40% per year on power consumption cost when consolidating workloads from compared x86 model systems. Compared z15 model consists of 3 CPC drawers containing 108 IFLs, & one I/O drawer to support both network and external storage. Power consumption of z15 is estimated using z15 Preliminary Power Estimator spreadsheet tool, assuming maxi CPU utilization. x86 systems ran at various CPU utilizations according to 15 customer surveys, representing Development, Test, Quality Assurance, and Production levels of CPU utilization and throughput. Three workloads were tested, consisting of a mix of leading databases and application servers. Each consolidated workload ran at the same throughput and SLA response time on Z and x86. Power consumption on x86 was measured while each system was under load. z15 performance data and number of IFLs was projected from actual z14 performance data including a performance improvement of 10% on z15. Compared x86 models are all 2-socket systems containing a mix of the following x86 processor models: 8-core Xeon E5-2667 v4, 12-core Xeon E7-8857 v2, 12-core Xeon E5-2680 v3, 8-core Xeon E5-4650, 8-core Xeon E5-2650, and 14-core Xeon E5-2690 v4. External storage is common to both platforms and not included in power consumption. Assumes IBM Z and x86 are running 24/7/365.Assume US average commercial power rate of $0.10 per KWh. Assume Power Usage Effectiveness ratio of 1.67 (67% additional power is required for cooling the data center).

7. IBID, August 2019.

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