PegaWorld iNspire 2024: Migrate to Pega Cloud and Drive Greater Value from your Pega investment

Thanks everyone for joining me today. I think we, uh, we're kind of towards the tail end of the, the breakouts. Um, so I know it's been a long two days, but, um, glad to have you all here. Uh, so just introduce myself. Uh, Thomas Mack, I am senior director of the global Pega Cloud business. Um, I've had the pleasure of being with Pega a little over 11 years now, um, helping support the growth and, um, uh, overall business strategy that we, uh, we roll out across, uh, for our Pega Cloud service, um, helping support kind of the product marketing and product management side, as well as I have a global team of, um, Pega Cloud kind of business owners that are helping us really support the all of our clients across the, globe and across verticals and industries, really understand the value of our service and hopefully help you all really leverage the most of it. So, um, today's session, we're really going to just going to focus on the migration to Pega Cloud. So for those clients that are, you know, all of you that might still be running on prem, running in your own client managed model, what's the value, the overall business case for our clients that are moving to our Pega Cloud? What's the overall value that you can gain and really improve your, um, your applications, your business and your overall Pega experience?

Uh, so I think I'll first lead with I'd be remiss to say, right, that Gen AI isn't at the top of everybody's mind. Um, and part of the largest value to be really gained right now is, um, really kind of highlighted in this great paper by McKinsey that is, you know, using generative AI in just a few functions can drive the most of the technology's impact across potential corporate use cases. Um, obviously the things we just heard with Don on on stage really highlighting, right. The transformation, um, that's going to be occurring across all of our, our, our businesses and, and the use of Pega within those is going to drive incredible value. We're going to see this, you know, obviously come through. It's not just a product. It's the way it's being incorporated, integrated into your business, the way we're really adding that, um, capability into every function and, um, facet of the business. And so incorporating that is going to be critical. Um, part of this paper also highlighted really the 75% of the total economic impact that we're going to see where they're evaluating that, we're going to see about 2.6 to $4.4 trillion annually, um, of economic kind of global growth.

Uh, and and the big focus of that is we're going to see about 75% of that happening in sales, marketing, software engineering, customer operations. So really all the critical areas that Pega is operating in, obviously servicing, um, you know, empowering your businesses in these really critical areas. So, uh, Jen AI is obviously top of mind, but it's the the truth is, how do you start to leverage that? Right. And how do you make sure that your business is getting the most of these capabilities? Um, and I think we can all see that the critical piece here is going to be, how do we start to really get through that? And the challenge is going to be the complexity that that brings. Um, so with high complexity, we're noticing across the board, right? As Pega is evolving, as our technology is evolving, as we're bringing out new capabilities and new services.

Um, for each of you, the landscape is changing, right? So in order for you to continue to manage and monitor and maintain those critical business applications, there's service operations and, uh, you know, database Administration and disaster recovery, and we go into security and compliance. Um, the multiple layers are just have to be managed and maintained for our clients. Uh, really is this kind of unnecessary risk that we're seeing across the industry, right? And our clients are obviously making a very dramatic shift over to, um, the cloud to really ultimately, how do we reduce that risk and how do we start to reduce that complexity that's really relying on you to be able to make the most of your Pega experience. So, um, why I'm here today is really to talk about what it means and why should you be considering moving to the cloud. And there's a couple key areas around this, right around building the business case and the overall experience that this really does to improve, um, your entire Pega ecosystem. Um, and so as one of the things I was already highlighting, right, is the first and foremost is mitigating risk, um, where we've really launched and brought about our Pega cloud service that we've now been running for, uh, 15 years. I think we started this in 2009 was our first cloud deployment.

Um, so, uh, the biggest thing that we, when we brought about our cloud service was how do we start to make sure that this is isolated, built for the enterprise, built for the most complex workloads, um, built for scale. Right. So clients that were, you know, were bringing onto our cloud, I think we're about, um, over half of our business is now running on the, on the cloud, and we see about 65, 75% of new workloads, um, launching and coming on board on our cloud services. And a lot of that comes down to, ultimately, how do we make this a secure and reliable platform. So when we talk about reducing the complexity that's on each and every kind of client managed deployment, we're talking about, not just the, you know, how do we deploy a service, but then ultimately, how do you operate and manage and run that and have to build out your own operational center for doing updates across the entire fleet. How do you make sure that it's being stable and compliant? So reducing downtime. What we've noticed is that 65% fewer incidences for clients that are running on Pega Cloud, as opposed to in a client managed model. So just a much more efficient, capable service.

We're able to identify issues quicker because we're actually monitoring and managing these services for you. And then when an issue does occur, we're able to actually remediate that issue 50% faster, reducing downtime. Um, this comes in a couple of different facets. But a big thing here is, is around the resiliency in our fault tolerance that we built into our service. So we deploy isolated deployments for all of our clients because we've built it for the the enterprise client. We have Multi-zone architecture, um, that goes into every layer that we deploy from our service architecture down to our databases and the application servers and, um, where it's not only built for the Multi-zone approach, but also this across data centers, but also we are now going to be launching at the, um, kind of end of this year. I'll call it our new multi-region disaster recovery capabilities that allow us to also replicate across paired regions for an added layer of resiliency, um, ensuring compliance. So security is obviously top of mind. How do you stay compliant with regulations across the globe?

The big thing that we you know, we kind of say as part of our benefit to our service is that every change and update we make to stay compliant for a new industry or a new regulation that's requiring that, is that we're implementing that across our fleet. So we take the best in breed, um, from a security posture, from a resiliency and really an isolation posture to make sure that those controls we're building in go across our entire fleet. Um, so all of this is part of, you know, that mitigating risk, making sure it's running and operating for you. Um, obviously the second avenue here is our how do we optimize cost? How do we make sure that this is economically beneficial to you as well? Um, we did a great study with Forrester on a total economic impact study. We went across our entire, um, well, several of our clients, I would say not the entire fleet, but that we actually did interviews with and they they ran a study, actually, to see the improvement that our clients had from going from a direct client managed model into our Pega Cloud service. Um, and overall it was $6.9 million, um, average cost savings that was enabled by moving to the cloud. And that obviously came from the way we optimize and run our resources, as opposed to just bringing it up on an infrastructure provider such as Amazon directly or Google or Microsoft Azure.

Um, but it also, you know, about their own internal Infrastructure. The development costs that they were spending to build out the operational controls and capabilities that you have to also manage on top of that fleet. This becomes, I think, ever increasing as I kind of go through the changes in our in the architecture, having to scale up and maintain those resources obviously becomes very costly. And then some of the other integrated capabilities we have in our service from DevOps, where we have clients that are actually able to improve their productivity, roll out applications faster, um, leveraging our DevOps pipelines that are integrated into the entire what we call the route to live. When you're running a Pega service from development, testing, staging to production. So all of these come at a, you know, a great, um, economic benefit for our clients. All in a very simple to understand subscription model. Um, so our big thing is we still license and base our, our entire cloud service on, uh, Business metrics that make sense to you, not on infrastructure. And this it provides us the ability to make sure we're scaling these services for your use as well.

Um, so second or third one here, accelerating innovation I think this is the most exciting piece, right. This is where we're really seeing the clients that are enjoying our Pega as a service experience is comes fundamentally down to accelerating their innovation. How do you start to get the most out of Pega, um, where several different kind of statistics here, but there's a 25% increase in speed of delivery. This is the ability to use what I was referring to in the DevOps pipeline, and able to really roll out changes into your your fleet of applications, able to roll out new applications, new workflows much more efficiently and quickly. Um, some of the things we're noticing is clients are deploying ten plus changes a week. We're rolling out changes and updates across the entire fleet as well to maintain and resiliency and the just the the ability to keep those services up to date from middleware to databases. Um, and then decreasing the time to market. So this is around the new Pega features. So all the great things we're seeing at PegaWorld year after year.

Right. Um, the, the great new features and capabilities. You're all you're seeing every day here, um, has been how do we start to bring those to your own business? How do you start to incorporate those? Um, those are directly applied to your service. Um, when you're on our cloud offering, um, we actually do seamless updates across the entire fleet. Um, so this is done for patches, the infrastructure middleware we provide, also the ability to, um, do, uh, major releases. And I'll talk more about the actual update experience as we keep going. But the ability to start to adopt those and leverage those into your business.

And then, um, a lot of our clients were able to implement and roll out new functionality changes. So as those updates come, you can put those updates into your next sprint and roll those out very quickly as well. So we're seeing huge acceleration in just innovation, in the leveraging of our of your Pega estate across your entire business. And this is kind of to highlight that, right. So over the last six years, we've put over 1.5 billion in, um, engineering and developing our product and enhancing Pega. And I know we have a large estate of clients out there that are still running Pega themselves. One of the biggest things we've noticed is that many of our clients aren't keeping up to date, aren't able to leverage the most of what Pega is offering. So any clients that are still three, four, or five years of out of date or have only done, um, more of the kind of baseline updates and not taking on these new services. There's a huge amount of untapped potential that you have.

Um, from App Studio to our DX API. We've changed our core architecture. Under the covers. Right for making it cloud native. Um, to help improve stability and the security of your platform. Uh Process Fabric. Process AI. There's also a bunch of new services that we're fundamentally running natively on our cloud service and are only on our cloud service. I know we're talking about gen AI, but we have Voice AI digital messaging, our Pega diagnostic Cloud, and um, deployment manager service.

All of these are now integrated and built directly on our cloud service and provided, um, to our clients as well in a more seamless integration. And then the the architecture change for most probably are getting familiar with. We've done a big architecture improvement really this was fundamental to allow Pega to start to release and update and our new changes across our services. So we went to a Kubernetes kind of Microservice based architecture. This was a big change in Infinity 24 and Infinity 25. We'll see more of that where we're getting out of running everything as this kind of more monolithic stack and putting it into a more microservice approach. This allows us to release changes more quickly. The market's changing so fast. The technology is changing so fast, so we can now release those changes much more effectively.

But it's also a big task to ask, right, for running in a more client managed model. Um, so these are things that are just naturally embedded in part of our cloud service. And then, uh, the last one here really is around sustainability and improving the carbon footprint, which I know is critical for a lot of businesses today, uh, we did an environmental impact study. Uh, we had a, uh, a lot of work and a lot of effort has been put in place to how do we optimize the Pega resources? How do we start to optimize the cloud that we're offering to our service or all of our clients across the globe? Um, and we actually with those big enhancements we've made over the last year and a half, two years, we've seen about 118 million metric tons of CO2 avoided annually, 28 million compute hours we've saved by really reducing the overhead, optimizing the resource load, and really optimizing the Pega itself. Um, so we're really honed in on how do we start to improve that, you know, environmental impacts as well. So kind of talked about the overall business case, right. But I think ultimately it comes down to once you're on the cloud, what is that experience like.

How does that change. Right. So yes, you got new capabilities in your hands. Yes. You can start to have these updates and a more reliable, stable service. Um, support becomes more seamless. But how does that experience change. Right. What are the kind of key facets that we're going to talk about here is around maintenance.

And operations is kind of two areas I'll kind of hone in on here. But there's a lot of different journeys that you go on when you're with with Pega. And as we need to update our platform or as we need to apply patches or as we need to redesign the architecture or operationally, things are running slow right when we hit road bumps. Um, when I need to, like, scale because I'm going to do a new application release or I'm going to roll out to a new user, um, workforce or a new region. Um, there's a lot of different operational tasks involved there. And I kind of wanted to highlight, I think, um, two on here that I'll talk about. Happy to discuss any as well. But um, the update experience. So currently if you're doing updates yourselves on your own systems, you're probably familiar with this, but you're most likely going to have to acquire new hardware resources from your own teams, or they'll have to procure those separately.

You're going to have to go through and configure and deploy Pega, um, itself and and sand that up, set up the integrations, set up the plan for how do you migrate that rules down? How do you start to test and validate those applications, then update it across your entire fleet on our Pega cloud service, right? The Pega as a service experience, what we ultimately are providing is a much more seamless approach. So when we talk about patches, when we're releasing patches, those are automatically applied. We start to roll those out across our entire fleet. We'll do those during maintenance windows. We'll make sure to notify you and obviously tell you about these, but we roll those out seamlessly. Zero impact to you. That goes for infrastructure in the middleware.

But the big thing, the big change is when we start to go through the more major releases. So we're talking about moving from Infinity 24 Infinity 25. The nice thing is we actually provide you a full cloned environment, allow you to do that testing right there. Um, when you give us the green light, when it's good, when you validated it, we then go and apply that update throughout your fleet for you. So we're taking on a heavy lift of this. We want you to just focus on the application, validate that it works. And then when you give us the green light, we apply that and we're good to go. So this is causing us to keep you know, our whole focus is how do we keep you current. Right.

How do you get the most out of Pega. Um, Steve Keating was up on stage with me last year, but, um, one of the things he also mentioned there was, uh, from Lloyds, um, was that, uh, over the last 12 months, he was received 21 updates. Um, so basically almost two updates every month, um, seamlessly applied, didn't even notice that they had been done. And this allowed them to continue to innovate, continue to get the most of their their own applications and not have to worry about that. It was a huge burden off them to not have to spend the, you know, the investment of time and resources and money and budget to do these updates. We're seeing about an 80% reduction in cost to do updates as we keep clients current, instead of waiting a year and then doing an update or waiting two years and then doing the update, that impact is pretty dramatic. across our clients. Second one I want to talk about is scalability. So I think scaling of Pega is is its own kind of unique thing, right.

Where you've got to go through and say, okay, do I have a new workload coming onto the application? Do I am I rolling this out across a new user base? Am I opening this up to my business or just natural occurring? Like we're seeing if you're exposing this externally to your clients, what is the scalability of more burst seasonality type activities? So there's a kind of a plan or roadmap for that. But when you when you're running this yourselves right. It's how do you determine is that temporary need or is that a long term need. Do I need to procure the hardware. How do I make sure to bring that business case to our own infrastructure teams?

Right. So you've got a long journey of like how do you manage and maintain and start to monitor and make sure that you're scaling that service and having the performance guarantees you want to deliver to your business On the Pega Cloud. That is one thing we are very adamant about, right is supporting scale. We have a very long list of great use cases and clients that are doing incredible workloads on our service, and this is one of the things we do manage and take care of for you. So we are constantly proactively measuring and monitoring these services. We know how Pega operates for certain workloads, so we've optimized how those services are running. And as we start to see thresholds hit, we're making sure that there's a scalability happening. We obviously have built in auto scaling for these, but a lot of this is also just making sure we're measuring across all facets of of the service, from browser response times down to the system resource loads. And so these are things we do automatically for you.

These aren't things that are build. We don't bring this to you. We don't charge you for extra servers or nodes or resources there. So this is part of the service as well. Um, one of the quotes from a great video for that Olivia Jacobs did from Wells was they have 31 million active users. This is using CDH that are doing individual targeted customer interactions, and they're delivering those in 350 milliseconds or less. The scale that we're providing across our our fleet is pretty incredible. So just another great, you know, kind of use case or story there around scalability and the improvement there around performance. So overall huge improvements to the, you know, the the Pega experience, right?

When we're trying to really focus on how do we mitigate risk, how do we make sure that you're having the best possible experience with your applications, optimizing our costs? You know, when we talk about how do we reduce that resource load, that requirement needed to spend on on your own teams and engineering and other facets, but also accelerating our innovation? I think that one of the critical things here, right, is just how do we start to get the best out of Pega? How do you use those capabilities? How do we start to leverage gen AI and have that in our hands? As you start to want to roll that out from the design time all the way up to the real use case? And when we get to testing capabilities and further right, there's going to be more and more of these things that are going to be at your hands and are immediately integrated into your service and then sustainability. So on that, um, I did want to leave you with one, um, good case study that I think kind of is more representative of that experience. So a long time client, um, it's been with Pega for a while as new Jersey courts, um, this one came from, you know, with the really pre-pandemic, it was a whole, um, bail reform process they were going through.

There was huge challenges that they were facing as they were rolling out Pega as well, is that they had they were running most of this themselves. They were going through huge, um, legislation, reforms that were being passed, um, that they needed to incorporate into their business. I think some of that was just naturally, it's harder to adopt those quick changes. Being able to build for change very quickly was limited by some of their own internal resources. Um, so the infrastructure limitations and others were preventing them from being able to adopt these new things and build out a new service. So, um, moving to the cloud helped enable that transformation, helped them actually start to build this and build out an application and a solution. Within nine months, they were streamlining the whole justice process for the police and court administrators. Um, they saw, uh, an improvement from about 23 hours to process defendants, um, to about 20 minutes. This came at a critical time also during Covid, when more, uh, resources were being moved to being remote and had to operate remotely.

Um, and then overall just improved their ability to adapt and leverage and automatically receive and maintain that that service and provide a near 100% availability for across the service. While they had to roll this out to their whole, their whole the whole city. So, um, pretty great, great use case and story there. Um, 10 million and really savings there, which is, you know, taxpayer kind of money. Um, but it was it was a big improvement for them just in the overall end to end experience of being able to adopt more from the cloud service. So, uh, with that, um, I will, uh, kind of leave it open if there's other further questions I would love to kind of be able to discuss or have any be able to answer any questions around our cloud service or migrations. Um, yeah. Go ahead. Jim Carrey, I'm with Mr.

Tista Government contractor contracted to the VA. Um, you've obviously done some good research and have some great, uh, statistics on cost savings. We're all I think are sold on. How wonderful. Um, what have you gathered? What research have you done, and what findings have you had on how much does it cost and the duration of migrating to the cloud? The title of the of the session. Uh, talk a little bit about what does it take to actually move to the cloud. Yeah.

Yeah, sure. Yeah. Happy to. Um, so that's a I think there was a session maybe yesterday for anybody that might have seen it. There is a Pega is heavily invested in the migration of our clients, who are really adamant to try to see how we can move you quicker and more efficiently. So we've invested in, in the entire kind of front end side of it. So we have a a whole dedicated team around application migrations, right, of how to move you over more efficiently and effectively. We have there's a whole I'll start with there's an application assessment tooling we actually have that can go in and we'll run that across your application. Find out the the areas where we need to address.

Right. So there's things that make it more cloud ready and native right where you need to invest. If you haven't updated the things we'll need to address to get you updated to the latest release. So that actually gives us a rough order of magnitude of the amount of hours, because every application is different. Right. Um, but that'll give us the time and the ultimately the cost that might be associated to do the migration. So most of that work is going to be um, the, the application side. So what changes do you need to remediate into the app? What we see mostly is things that clients that have done a lot at the database level where you're actually creating triggers or user defined functions, right?

So you're creating things at the that the database as opposed to building those in Pega. Those are just examples of things we will have to remediate and build into the Pega application. Um, from that, uh, we'll then provide you where you can either use a partner, one of our great partners, or use our Pega consulting resources as well to help you move to our cloud service. Um, ultimately, what we see is around, um, it's about a 3 to 6 month migration for most of our clients. We take on a bulk of that migration work where we actually will stand up a parallel service for you. We will migrate the rules and the data over for you as well. And then you can actually use it in the latest release. And so then once you remediate those changes, um, you're kind of up and running at that point. So yeah.

So there is no cost for the migration work. Um, there is no cost for, um, doing the assessment with you. So we'll do that with you and we'll provide that as part of, you know, bringing you over to our service as well. So that's absolutely yeah. That is something we'll absolutely do with you. Um, the the cost there is really associated to application remediation work. So anything you need to do there. Right. Um, but that's a list we'll be able to provide you.

You can choose to do it with Pega Lead and yourselves, or you can do it with a partner as well. Does that help? You. Absolutely. What's pega's. What's pega's? Uh, we'll call it official statement on, uh, FedRAMP high for government. So FedRAMP high. Um, we are in progress with that.

I don't know if we have. I think we're working to achieve that. I don't know if we have the date, though. Do you know, Andrew? I'm kind of looking. I don't have the date, but that is what we are actually actively in progress with. Um, I wanted to say would be October. I don't know why that's in my head right now, but don't hold me to that. We can definitely get you that though.

That is, we're going through the the review process right now. Yeah. Uh, so overall, if yeah, if there's anything else I can help you with, happy to, you know, individually talk to you. Um, we have a great dedicated team that is, you know, really looking to move as many, um, clients that are running this themselves and help you understand the business case individually. So we have dedicated teams that will that will work with you, actually build out your specific business case, help you understand the economics, help you, um, really understand what's going to take to move not just from a technology, but the commercials and everything else so that you can help bring that to your business as well. And, uh, any other questions? Thank you.