Unlike your best friends and wine, the software does not get better with age. Clearly, your current smartphone is far more powerful than the one you owned years ago. Similarly, the business you are running is not the same it was when it was founded. And therefore, using legacy and outdated systems is not a smart business decision. Embedding digital at the heart of your corporate strategies and modernizing legacy systems is all you need to level up your game in the present era.
Why modernize legacy systems?
Digital transformation has made it imperative for organizations to uncover effective ways of optimizing their underlying infrastructure. Although legacy systems play an indispensable role in the overall functioning of the business, they just may not be capable of driving the level of efficiency that the modern world demands.
Here are 5 reasons why it’s critical to modernize legacy systems:
- Competitive advantage: If you want to drive competitive advantage in your industry, modernizing legacy systems is crucial. With almost every organization today on the digital transformation journey, continuing to rely on rigid and inflexible systems will cause you to be a laggard, causing not just your customers but also your employees (and other stakeholders) to choose your competitors over you. Over time, popular enterprise solution PeopleSoft struggled to keep up with the requirements of the modern-day. Not only did organizations find it difficult to incorporate tailored business practices; they also couldn’t efficiently integrate their business via one unified platform.
- Happier end users: Today’s users want the same sophistication and innovation in the enterprise systems they use as they enjoy in their personal lives. Legacy systems, being difficult to use and integrate, tend to impact the overall efficiency and productivity of end users. Modernizing them can aid in improving their morale and also the accuracy and timeliness with which they can accomplish tasks and meet goals.
- Unlocking big data opportunities: Legacy systems do not possess the analytical capabilities that businesses today require. Since they are poorly integrated, they are incapable of sharing data with other systems in the tech ecosystem, leading to rigid data silos, and thus, poor decision-making. Modernizing them, instead, can allow you to unlock several big data opportunities, allowing for data to flow and be collected seamlessly – from across the organization. Post COVID, employment organizations in the US witnessed a severe inability to process the requests of 13% of the national workforce that were left without a job – mainly because their systems were more than 4 decades old, and were built using proprietary technologies like COBOL.
- Future-ready business: Modernizing legacy systems while embracing the latest digital technologies like IoT, analytics, cloud & edge computing, digital twin, etc. can also make your business future-ready. Not only will you be in a better position to keep up with the latest trends; but timely modernization will also allow you to respond to new changes and requirements with far greater agility. The Department of Internal Revenue Service faced massive issues when their legacy tax filing systems could not process electronically filed tax returns of nearly five million Americans.
- Better reliability and performance: Enhancing system reliability and performance are some other reasons for legacy modernization. By getting rid of features and functionality that are no longer required and updating or upgrading those on par with the latest innovations, you can make sure to leverage these systems to meet your targets. The decision to modernize Windows XP, for instance, was taken by Microsoft as the proprietary operating system could no longer keep up with the security and performance requirements of a modern world.
- Ease of access: Another key reason to modernize legacy systems is to improve access. Since modern systems can be easily accessed from anywhere, they aid in improving efficiency and collaboration and in driving better business results. For example, enterprise software Tally was initially accessible only from a particular desktop/laptop. Post modernization, users can now access Tally from anywhere, at any time, and using the device of their choice.
When is the right time to modernize your legacy system?
There are no qualms about the fact that modernizing legacy systems is critical to the overall success of your organization. But the question is, when is the right time to modernize them.
Ask yourself these questions to get a fair idea of a potential timeline; if the answer to most of these questions is a “yes”, the time to modernize is now:
- Hidden costs of legacy systems: Do you find yourself incurring humongous costs in running and managing your legacy systems? Do you spend additionally to enable the flow of information? Are you forced to hire niche talent to troubleshoot problems?
- Maintenance and support: Are maintenance and support Herculean tasks for you? Do you lack the resources or skill set to manage your legacy systems? Do you end up spending endless hours repairing minor issues?
- Technical debt: Do you find yourself submerged in technical debt? Is the cost to make any tweaks or changes to the code a time- and cost-intensive process? Do you find yourself struggling to optimally maintain the system?
- Integration and modernization: Is the process of legacy system integration a nightmare? Do you end up investing in thousands of expensive plug-ins and add-ons, just so you can enable seamless integration?
- Security and compliance: Are the security and compliance issues you’re facing constantly increasing? Is your IT team incapable of patching security loopholes?
- Lost business opportunities: Do you find yourself losing out on business opportunities? Do your legacy systems restrict you from keeping pace with the latest trends and innovations?
Organization agility and efficiency: Do you struggle to drive organizational agility and efficiency? Are your employees taking way too much time in accomplishing day-to-day tasks?
How to approach modernization?
Modernizing legacy systems is critical from a strategic as well as an operational perspective. But so is approaching it in the right manner. If you want to avoid integration hassles, improve organizational visibility, and enable enterprise innovation, here are key steps you need to follow before a tipping point is reached:
Step 1 – Evaluate your legacy system using key drivers
Before embarking on the modernization journey, it is important to first evaluate your legacy system. This includes understanding the source code, identifying the technologies used to build the system as well as assessing integration and data sharing capabilities. List down the challenges created by the legacy system because of the technology, architecture, or functionality. Check if your systems continue to be fit for business, add value, and enable agility. At the same time, evaluate the costs, complexity, and risks of operating and managing your legacy systems.
Step 2 – Understand the different modernization options
Once you have a fair understanding of how your legacy system was built, it is time to evaluate the different options you have to modernize your legacy applications and deal with obstacles in time – for continued long-term benefits and results:
- Encapsulate data and functions of your legacy applications and extend them via APIs
- Rehost your legacy system onto a cloud or virtual infrastructure – without making any changes to the underlying code, features, or functions
- Re-platform your system to a new runtime platform – by making minimal changes to code but none to the code structure or functions
- Refactor or restructure existing legacy code to eliminate technical debt and enhance non-functional attributes
- Rearchitect the underlying code completely and move to a new application architecture to exploit modern capabilities
- Rebuild or redesign the entire system from scratch while preserving its scope and specs
- Replace the legacy application completely with a modern system to meet new requirements
Step 3 – Choose the best suitable modernization approach with the highest business value
The last step in the legacy modernization journey is to choose an approach that is best suited for your unique system and drives the highest value for your business.
Legacy systems have played a critical role in running a business, but obsolete technology and degraded architecture hamper digital transformation and innovation. Not only are they difficult to operate; they require a great number of resources for maintenance.
Modernizing monolithic legacy systems can help promote better evolution and maintenance, taking advantage of new technologies such as microservices. Modernize your legacy systems today and make the most of the latest in technology to enhance competitive advantage, employee productivity, and customer satisfaction. Get in touch with our subject matter experts to discuss how we can help.