A Mainframe MLC Cost Management Maturity Model — 5 Steps to Reducing Costs

A Mainframe MLC Cost Management Maturity Model

The journey of helping customers reduce mainframe costs began for BMC about five years ago, when we asked our customers how we could help them meet their future needs. The response was loud and clear; customers’ biggest mainframe challenge isn’t technical – instead, it’s all about reducing costs.

Here’s the dichotomy. The mainframe continues to become more critical to delivering business services, especially with the explosive growth of digital engagement. Yet the IBM mainframe Monthly License Charge (MLC) software costs keep increasing each year for essential products, such as DB2, IMS, CICS, MQ and z/OS. The cost of these products places extreme pressure on IT because they represent the largest portion of expense for the mainframe – often considerably more than what you pay your hard-working mainframe IT staff in total. This is not a good equation.

To address this challenge, BMC has developed a maturity model for mainframe MLC cost management that helps our customers identify where they are on their journey toward optimizing mainframe MLC costs. We recommend you follow this model, because we know that those who don’t unfortunately pay IBM more than necessary. And why do that?

BMC can help you to quickly reduce the pain of rising MLC costs with more automation and control, along with  best practices that weren’t available just two years ago. The process for MLC cost reduction is not complicated and the technology is available to help you start now and achieve a rapid ROI. We’ve also brought in key partners to support this comprehensive model.

“R4 B4” You Sign

Using this 5-step maturity model, we’ll show you how to R4 your world (that is, take control over the peak 4-hour rolling average) before you sign your next MLC contract. It will also help you to save money now. Order matters, and we suggest that you follow the steps in the model sequentially, from left to right.  Let’s take a deeper dive into the model.

  1. Identify Cost Drivers
    Begin with a cost analyzer solution to help you understand what’s driving your MLC costs. The solution can take MLC figures for the year and track them on a daily basis. This way, you can see if some bills are running too high during certain months and then model the cost impact of changes in your workloads to meet your budget. A cost analyzer solution can provide deep insight into the batch jobs and other workloads that drive the peak. For example, you may not be aware that some batch workloads may have occurred during the peak 4-hour rolling average. With this insight, you can make changes and reduce costs.
  2. Tune or Move Peak Workloads
    The second step in the maturity model focuses on monitoring and tuning systems and applications to reduce consumption of mainframe resources. You can leverage a low-overhead monitoring solution that discovers high-level application performance issues caused by inefficient resource utilization and pinpoint and tune wasteful resource consumption. You’ll see significant improvements in elapsed times, execution costs, and availability that can create a big savings in MLC costs. Using tools that pinpoint application code that runs high in resource consumption can really save time and lower your MLC.
  3. Implement Dynamic Workload Capping
    Are you ready to implement dynamic workload capping? It’s a great way to improve resource usage in an intelligent manner and protect the most critical work. Intelligent capping solutions let you set your own policy to factor in workload importance and dynamically adjusts caps while ensuring that critical workloads run on-time. For example, a large US transportation company used a cost analyzer solution to identify the drivers of peak usage and MLC costs. Then, with an intelligent capping solution, they reduced peak MSUs, lowered MLC costs by 20 percent, and achieved an ROI in just six months.
  4. Optimize Subsystem License Charges
    Time to bring in the robots to enable subsystem optimization. Subsystem optimization allows you to reduce MLC costs by separating subsystems – like CICS, IMS, and DB2 – and putting them on separate logical partitions (LPARs) while still being able to communicate with each other. This separation can often reduce MLC costs dramatically because charges for most MLC software products are based on the peak rolling 4-hour average on the LPARs on which they run. When you reconfigure MLC software in an efficient way, the MLC math changes in your favor.
  5. Develop Advanced Contract Negotiation Strategies
    Don’t negotiate your next MLC cost contract alone. Be prepared. Be very prepared. These contracts have complex terms and conditions. You can level the playing field by bringing in an expert, like SZS Consulting, Ltd., who can help your organization plan ahead to purchase only what is needed before you sign a contract. If you expect to reduce MLC costs during the course of the contract, you need to implement the reductions before the negotiation starts to show that your estimates are accurate. This approach can help you to set realistic price points along with more favorable terms and conditions.

The Maturity Model Is an Addition – Not a Rip and Replace Approach

If you’re like most IT organizations, you might be concerned that using a new model will be disruptive. But it’s not. Instead, think of this model as a structured approach to help guide you in your journey to optimizing the mainframe.

It might seem like you’ve done everything that’s possible to reduce MLC costs, but as you look at this model, you may gain a better understanding of potential savings. Then you can take actions to achieve savings quickly without disrupting the work of your teams.

On Demand Webinar: Applying Structure to Mainframe MLC Cost Reduction Projects


In this webinar, Jay Lipovich and Tom Vogel share a structured, yet flexible model you can apply to significantly reduce your mainframe costs.

Watch the webinar now ›

These postings are my own and do not necessarily represent BMC's position, strategies, or opinion.

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Donald Pate

Donald Pate

Don began his career with IBM 35 years ago and has served in a wide range of roles during that time including CEO positions with Tonic Software and NEON Systems. He currently serves as BMC's VP of Z optimization.