When Patty Watson joined Total System Services (TSYS) as CIO in 2015, reliance on the cloud was a pipe dream.

Doctrine at the credit card processor and issuer was clear. Mainframes were the only technology capable of bulk transaction processing.

There was a belief "we will never go to a cloud environment. Ever," Watson told CIO Dive in an interview.

Culture adapts and stalwarts change their tune.

The financial services industry has wavered toward cloud acceptance, weaving it into services when customers — and compliance standards — permit.

The oversight and security in financial services looms large compared to other sectors because the industry processes sensitive personally identifiable information (PII), said Barry Libenson, Global CIO at Experian, in an interview with CIO Dive.

By extension, the industry is risk averse and slow to transform, but consumer demands accelerate the appetite for modernization.

Mobile technology has made people much more aware of tools they use on a daily basis, said Libenson. Everyone expects mobile banking through their phone, which forces modernization, even for consumer credit reporting companies like Experian.

TSYS hired Watson to centralize technology, transitioning from an environment where everyone had their own tech team and lacked a common tech strategy to enable the business. Attention turned to attracting and retaining talent, efficiency, growing revenue and managing risk. At the strategy's core was system modernization around mainframes and infrastructure.

Business leaders no longer require much convincing, when technology leaders present plans to modernize. The holdouts, instead, are those who have to go through the change.

Modernization 101 at TSYS

Mainframe technology, which dates back to the 1950s, underlies much of today's bulk transaction processing. More nimble systems have come to market, but transitioning off mainframes, with decades of code interwoven through core processes, makes modernization arduous.

Mainframes systems can run (practically) forever and have 99.99% uptime. While the speed of technology is accelerating, the mainframe world is "very slow-paced," Watson said.

At TSYS, core processing platforms are on mainframe technology. "When I started talking about mainframe modernization and moving workloads off the mainframe, people looked at me like I had lost my mind," Watson said.

There's an emotional element to technology transformation. While many adapt quickly, others hate change and question their place in the future.

If you tell the person racking and stacking servers TSYS is moving to the cloud, they're going to think of job loss, according to Watson. Reskilling is critical and TSYS has calculated and transitioned people team by team to learn new tech and more agile development methodologies.

TSYS employees have gone through digital bootcamps and immersion programs since 2017. The bootcamps, combined with other training programs, has reskilled 2,000 of the company's more than 13,000 employees, according to TSYS' ngenuity payments journal. 

To change the hearts and minds dedicated to dated technology, Watson tapped the man who had written the mainframe core processing platforms to lead mainframe modernization efforts at TSYS.

He took the "bull by the horns," Watson said. TSYS went through a number of proof of concepts and case studies where companies succeeded or struggled with mainframe modernization.

Companies fail when they approach mainframe modernization as a big bang, rewriting all applications and throwing it into a distributed environment, according to Watson.

"Where we've arrived is we are moving down the path of moving workloads off the mainframe," but the code is "fit for purpose," Watson said. "It's still COBOL, it's just running in an on-prem or off-prem cloud."

Logistics — and the sensitivity of — the cloud

Where workloads run in the cloud matters, as evidenced by the retailer exodus from Amazon Web Services. Regulation also dictates what a financial services company is willing to put in the cloud.

TSYS is moving toward either on-premise or public cloud, though it reserves the public cloud mostly for development tests.

The firm also has contracts with customers dictating where its processing can run.

Customers span the array of technology transformation and demands. We have customers in the cloud, some are in this journey with us, and others say, "heck no, I'm never doing that," Watson said.

TSYS provides options; all its new development runs on containers, allowing the company to move workloads between various cloud providers or on-premise.

The same is true of Experian. "It's a build anywhere, deploy anywhere" strategy at Experian, Libenson said. The company doesn't want customers or software developers to be concerned about where workloads lie.

We're the "Switzerland of hosting," Libenson said. It's up to developers and customers to dictate where a workload runs, a process which is completely transparent. Workloads can run in a customer's data center, on Experian's data center, through AWS or on Microsoft Azure, or others.

It allows for "tremendous elasticity during seasonal peak workloads," Libsenson said.

During Christmas time or the holidays, people apply for new credit cards or have multiple credit transactions, which leads to more fraud detection and credit checks.

With the cloud, Experian doesn’t have to build out data centers or collocation facilities. Certain transactions run in the public cloud at all times, while others are hybrid if elasticity is required.