Jack Henry Reiterates IBM i Support “For The Foreseeable Future”

July 31, 2023 Alex Woodie

Jack Henry & Associates has been tied to the IBM i and its predecessor platforms for its entire life. The company’s flagship RPG-based product for community banks, Silverlake, is the same name IBM used for its AS/400 development project. And while Jack Henry is developing applications in other technologies and other platforms, the IBM i will be supported for the foreseeable future, the company says.

Like many companies in the IBM i ecosystem today, Jack Henry has a modernization strategy, and that modernization strategy involves several, interrelated components.

For starters, the company wants to move away from the old style of development, which revolved around developing business logic in monolithic blocks of RPG code that are periodically updated and released on a set schedule, to the modern style of development, which revolves around creating business logic using microservices, connected via APIs, and released as needed using continuous integration/continuous deployment (CICD) techniques.

And while the company is modernizing how it develops, it is also modernizing what it develops. Currently, Jack Henry has four “cores,” or large integrated suites of banking applications, two of which run on IBM i, one on AIX, and another on Windows Server. Thousands of community banks and credit unions rely on the cores, and Jack Henry also serves as a private cloud provider for many of the IBM i shops. The newer Web services products are being developed in a mix of languages and databases, including Go, Scala, and C# on the language front, and PostgreSQL, SQL Server, MongoDB, Google Cloud Spanner, and Kafka when it comes to data stores.

Jack Henry is also updating where it’s running (which obviously is a function of the technological choices above). Today the bulk of the customers are tied to IBM Power Systems servers running either IBM i or AIX and using the Db2 database. But in the future, Jack Henry wants to deliver a fully functional banking application as software as a service (SaaS) running in the public cloud. The deployment goal for many of the cloud Web services is Kubernetes running atop Red Hat OpenShift.

We first wrote about Jack Henry’s technological roadmap over a year ago. IT Jungle recently caught up with Makenzie Kaiser, Jack Henry’s senior managing director in the CTO office, who oversees all of the company’s engineering.

“Ultimately what we’re wanting to do is move into a model where we aren’t thinking from a product perspective and we’re not architecting and designing solutions in a monolithic methodology,” Kaiser said. “We want to move into a model where we can deploy fast, where we can think of things from a multi-tenant SaaS perspective, and we can be more agile with our customers.”

“We’re moving from a company that was born on the IBM i on the banking side and the pSeries, and we have tons of equity in intellectual property that is unique in our industry and we’ll continue to leverage that and continue to invest in it,” he continued. “But at the same time, we’ll begin to provide alternatives to our customers that will come in different shapes and sizes.”

Jack Henry’s four cores have hundreds of individual components among them. The company has a strategy of creating a Web-services version of the existing components–such as the general ledger or loan servicing, etc.–at a pace of about eight per year. At that rate, it will take several decades to create a full Web-based core banking application. In the meantime, the existing cores will continue to be updated and maintained.

“We want to bring our core products to the Internet and we also want to get out of a legacy monolith, major-release type model. But we’re going to continue to choose the best technology to do that,” Kaiser said. “I want to be clear: Although workloads will move around, we feel like the i is a part of that future for a long, long time.”

Twenty years is a very long time, and plotting out a roadmap that far into the future is practically impossible, Kaiser pointed out. While the IBM i-based cores, Silverlake and CIF 20/20, are based on modern RPG and utilize the Db2 for i database today, the idea that they would be running unchanged in 2043 is very far-fetched. While Jack Henry’s customers are conservative, they’re not dead, and they realize that technology changes and they want Jack Henry to change with it.

Jack Henry has visited with leaders of IBM, Microsoft, and Google to determine what their roadmaps are, and how they align with Jack Henry’s goals. The company recently visited IBM’s lab in Dallas, Texas, where its Red Hat OpenShift piqued the interest of Jack Henry executives. As IBM’s flavor of Kubernetes, OpenShift is squarely in Jack Henry’s crosshairs.

The problem is, there is no visible intersection between Kubernetes and IBM i. That’s one reason why it’s critical that Jack Henry continue to develop new functions on the IBM i, since many of the new Web services that the company will be creating in the future won’t run on IBM i.

Jack Henry today spends 14 percent of its revenues on research and development, and a portion of that is going to developing banking software that runs on industry standard technology in the cloud. But it’s also continuing to invest in developing new features and functionality for the IBM i and AIX products, Kaiser said.

For example, the company recently updated its wires functionality. The US federal government has mandated that all banks support a new standard for conducting wires by 2025. Jack Henry could have used that mandate as a lever to force customers to adopt the new Web-based wires product it developed, which runs atop Kubernetes and leverages the hosted version of MongoDB’s NoSQL database, Atlas. But instead, it invested in updating the wires functionality in its IBM i cores, Kaiser said.

“We invested in that new wires component, but we also invested in the wires component that runs on the Power series, on the i for our customers. So we’re investing in both places,” he said.

Jack Henry also recently completed a project that utilizes the Apache Kafka messaging bus to move data in real time from IBM i cores to analytical databases running in the cloud, such as Snowflake or Google Cloud Big Query. That required extensive investment and modifications to the Db2 for i tables, but will deliver a big functionality boost for IBM i customers, Kaiser said. These two development efforts show Jack Henry is still investing in IBM i development, he added.

“The fact of the matter is that a lot of our financial institutions love that we’re running workloads on a Power Systems machine and they also have a great deal of trust in their intellectual property that’s tried and tested there, versus this brand new service that we built in the cloud,” Kaiser continued. “They’re really risk averse and so we want to help them modernize at the pace that they want to modernize, but still be a strong provider in the technology that we have expertise in as well.”

Customers that buy Silverlake or CIF 20/20 today will be able to keep running those applications on IBM i for a long time. “They’re going to continue to run their workloads on the i for the foreseeable future,” Kaiser said.

Jack Henry’s roadmap matters because it’s such a successful and visible member of the IBM i ecosystem. The company’s IBM i products are considered world-class, and it has consistently grown profits for decades. But at the end of the day, the Monett, Missouri, company isn’t an IBM i software developer; it’s a banking application developer. It used IBM i as its core technological platform because it served that purpose very well. Today, other technologies are delivering things that IBM i can’t, and Jack Henry needs to be looking at them to ensure that it continues to deliver value to customers, as well as shareholders, in the long-term.

“We know that we have to be looking around the corner,” Kaiser said. “We know that we have to move into a model where we can do continuous deployment, continuous integration. We know that we have to move our workloads into things like Kubernetes or globally distributed data stores because that’s what the market demands and also that’s just what our customers want to see us investing in. They want to see us doing those sorts of things.”

Jack Henry has no plans to draft any end-of-life letters for Silverlake’s features and functions, and the company has no plans to, Kaiser said. It’s full steam ahead for IBM i development at the moment.

But Jack Henry is also planning for a future when the equivalent functionality of Silverlake can be had over the Internet. The new development efforts make Kaiser’s job more difficult, he said. But when it has the Silverlake equivalent, running in the cloud, in an always-on fashion – and it doesn’t take an army of Jack Henry employees to manage the private cloud anymore – then Kaiser will know that his company’s technological roadmap was successful.

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