Home
Tech Grid
News Room
Interviews
CISO POV
Think Stack
Articles
  • Home
  • /
  • News
  • /
  • AI
  • /
  • Agentic AI
  • /
  • Kyndryl Report: AI Broadens Modernization, Leaders Focus on Outcomes
  • Agentic AI

Kyndryl Report: AI Broadens Modernization, Leaders Focus on Outcomes


Kyndryl Report: AI Broadens Modernization, Leaders Focus on Outcomes
  • by: PR Newswire
  • |
  • October 1, 2026

Kyndryl, a leading provider of mission-critical enterprise technology services, today released its first global Modernization Report, which found that as organizations expand investments across legacy and modern platforms, modernization increasingly requires business orchestration, not technology consolidation.

Global survey reveals how 2,000 business and technology leaders are addressing AI-driven demand across IT elements.

Quick Intel

  • Kyndryl releases first global Modernization Report based on 2,000 business and technology leaders across five continents and 12 industries.
  • Nearly half of organizations behind schedule despite modernization being top priority; 98% delayed and experienced negative business impacts.
  • Need to adopt AI now outranks reducing spending, replacing legacy systems or addressing shrinking legacy expertise pool.
  • AI is top driver for increased mainframe and edge use, second-biggest for SaaS and private cloud expansion, leading reason for network upgrades.
  • 10% deployed agentic AI in production for modernization for dependency mapping, code conversion, documentation; 67% ahead or on track vs 51% others.
  • Only 9% fully understand application dependencies; 63% expect sovereign cloud usage to increase.

AI Reshapes Modernization from Consolidation to Orchestration

As AI reshapes expectations for how technology can deliver results, more organizations are expanding their use of technology than consolidating them. Based on insights from 2,000 leaders, the research shows how AI is reshaping investment priorities across infrastructure and applications, while also challenging organizations' operating models.

According to findings, the need to adopt AI now outranks priorities to reduce spending, replace legacy systems, or address a shrinking pool of legacy systems expertise. AI is the top driver of increased mainframe and edge computing use, the second-biggest driver for SaaS and private cloud expansion, and the leading reason organizations are upgrading their networks and application portfolios. Every organization with a mainframe now reports plans to deploy AI to the platform.

Together, these trends are creating more complex technology environments and new operational challenges for technology leaders.

Agentic AI Emerges to Accelerate Modernization Progress

Nearly half of respondents said they are behind schedule on their modernization goals. Agentic AI, which can autonomously plan and execute tasks, is emerging as a way to modernize faster. Ten percent of organizations have deployed agentic AI in production for modernization, applying it to typically time- and skills-intensive tasks of dependency mapping, code conversion, and generating documentation. Early adopters reported stronger outcomes, with 67% saying they are ahead of or on track with modernization goals, compared with 51% of other organizations.

The research also highlights what is slowing organizations down. Just 9% said they fully understand their applications' dependencies, and one-quarter say they have large numbers of undocumented applications.

Modernization Becomes Business-Wide and Sovereignty-Driven

Modernization has become a business-wide priority, not just a technical one. Respondents named nine distinct stakeholder groups with control over modernization, from CIOs and CTOs to boards of directors and finance and compliance teams. Modernization has outgrown the IT department and become a board-level business decision.

Global events shape technology decisions alongside cost and performance. Sovereignty considerations are a growing factor. While 65% address sovereignty selectively or primarily through compliance lens, 63% expect sovereign cloud usage to increase and 55% expect sovereignty and regulatory requirements to place greater demands on network architectures. The findings suggest geographic location of where technology runs is increasingly shaped by governance and geopolitical considerations.

Complexity keeps compounding. Mission-critical applications are distributed almost evenly across public cloud, private cloud, mainframe and on-premises environments, creating increasingly hybrid enterprise requiring strategic, governance, and operational coordination.

 

About Kyndryl

Kyndryl is a leading provider of mission-critical enterprise technology services, offering advisory, implementation and managed services across thousands of customer environments in more than 60 countries. The company designs, builds, manages and modernizes the complex information systems that the world depends on every day.

  • AIAgentic AIEnterprise IT
News Disclaimer
Want to reach B2B tech decision-makers through TechIntelPro? Get our Media Kit
  • Share
Enterprise Tech News