Mainframes continue to be the backbone of the global economygettyMainframe computers are often perceived as relics of the past but in reality, they continue to be the backbone of the global economy. Critical data related to finance, government, and other sensitive transactions pass through these systems daily. Over 70 percent of Fortune 500 companies still rely on mainframes despite the rise of cloud computing. The key to their continued relevance is modernizationadapting these powerful systems to meet the needs and opportunities of todays technological landscape without losing the stability and security they provide.Why Mainframes Still MatterPeter Rutten is Research Vice President at International Data CorporationIDCMainframes have been around for over 60 years and remain the most reliable platform for handling massive amounts of data and transactions. As Peter Rutten, Research Vice President at IDC, explained, Mainframes were built for the highest possible performance and uptime, with the greatest security. In fact, theyre still used by industries like banking, airlines, and healthcare, where data integrity and continuous uptime are mission critical.These industries process billions of transactions daily, for which downtime is not an option.CEO of Rocket Software Milan Shetti echoes this sentiment, emphasizing that mainframes are "the backbone of the world economy because of their three major capabilities: security, governance, and very high performance." They are trusted for sensitive transactions such as wire transfers and insurance claims due to the degree of security and reliability that few other systems can match. The lack of headlines about mainframe failures or security breaches is a testament to their robustness, something Shetti proudly notes: Mainframe has done a really good job of staying out of the headlines for the wrong reasons.Yet, while mainframes are still trusted for mission-critical tasks, there is no denying the growing pressure to adapt to emerging technologies, such as cloud computing and artificial intelligence. This is where mainframe modernization comes into play.MORE FOR YOUThe Need for ModernizationMax de Groen, Partner at Bain CapitalJennifer Cimino PhotographyModernization is not about replacing mainframes but enhancing them to work seamlessly with modern technologies like cloud and AI. Max de Groen, Partner at Bain Capital, says, mainframe modernization is increasingly seen not as a necessary evil, but as an opportunity to leverage existing investments and integrate emerging technologies. Indeed, many enterprises are recognizing that modernization is essential to stay competitive, meet consumer demands, and manage costs effectively.The process, however, is not simple. A basic mainframe modernization project can take two years, while more complex ones can take five or more, explains Rutten. This timeline highlights the difficulty of integrating decades-old systems with newer, more flexible cloud environments.Shetti emphasizes that the goal is "modernization without disruption." Rocket Software, for instance, focuses on helping organizations modernize in placeupgrading their existing mainframe systems to work with new technologies without the need for a complete overhaul. He cites the example of a banks mobile application, which might be cloud-based but will still rely on the mainframe to access secure customer data.CEO of Rocket Software Milan ShettiRocket SoftwareThis hybrid approachconnecting the cloud to the mainframeis becoming the preferred method for many enterprises. "Youll never see end-to-end banking in the cloud," Shetti insists, explaining that cloud computing may be better for scaling applications and attracting developers, but the mainframe is preferred when handling sensitive data with the highest levels of security.The Role of AI in ModernizationAI is playing an increasingly important role in mainframe modernization. Rocket Software and other companies are using AI for "code explainability, which helps current engineers understand and modernize the vast amounts of legacy code that power mainframes today. This is crucial because many original developers who wrote this code have retired, leaving a knowledge gap that AI can help bridge.Shetti also envisions AI simplifying mainframe operations to the point where managing a mainframe could be as intuitive as operating an iPhone. This use of AI improves operational efficiency and helps attract new talent to an industry that has long been associated with complex, outdated technology.The Economic and Security ImpactsMainframe modernization has broader implications for the economy and security. Rutten points out that "70% of enterprise data still runs on mainframes," meaning that any failure or breach would have far-reaching consequences. This is why modernization is so criticalit allows enterprises to take advantage of cloud scalability and AI innovation while maintaining the security and reliability of their core systems.Moreover, de Groen highlights that modernization is about more than just keeping the lights on. Its about leveraging the power of datadata that resides on the mainframeto drive new business models, improve customer experiences, and stay competitive in a rapidly changing digital landscape.Mainframes may not be flashy, but they are indispensable. As Rutten wisely states, You dont move off the mainframe; you integrate with it. The future of enterprise IT lies in this integrationblending the unmatched security and reliability of mainframes with the flexibility and innovation of cloud computing and AI. For organizations that rely on these systems, modernization is not just an option; its necessary to remain competitive and secure in the digital age.Follow me on LinkedIn or check out my other columns here.