Legacy Software Modernisation: Stop Struggling, Start Knowing

Businesses across industries agree that legacy software modernisation is a critical move to gain a competitive edge, adapt to changing technology landscapes, and lead the market.

In fact, in 2023, Statista found that over 50% of companies quote reasons like increased security and efficiency as the main motivations for modernizing their legacy applications and data. This is even crucial when you see the projected tsunamical surge in Cybercrimes which will be a $10.5 trillion economy by 2025.

But that’s not it, legacy software modernisation saves businesses a lot of money. A study by IBM found that legacy system modernisation achieves significant cost savings:

• Up to 15-35% yearly cost savings on infrastructure.
• Up to 30-50% saving in application maintenance and running costs.
• A whopping up to 74% reduction in hardware, software, and staff costs.

However, more often than not, businesses hesitate to take action to switch to modern software. The reasons vary from not wanting to touch their existing system to not being sure about modern alternatives to not knowing if they need modernisation.

Hence, in this blog, we will share the characteristics and harms of legacy software systems. This will help you understand whether your existing system needs changes and what are the harms if you do not opt for modernisation at the right time. Also, we will be sharing five steps as part of a safer legacy system migration strategy. This will guide you on how to modernise your existing system safely without affecting the existing critical processes of your system. Let’s start with the definition.

What is Legacy Software: Definition and Characteristics

Legacy software is basically outdated applications or systems that your organization might still be using despite newer and better technology alternatives being available.

So if your business is relying on DOS-based accounting software from the 1990s, while sophisticated cloud-based accounting platforms watch you from the sidelines, you are running on legacy software.

This is a very toned-down example. In the real world, things are not so easy to spot. In fact, many times businesses are not even aware that their struggle is more because of legacy software and less because of the lack of resources and talents or the rapid advancements in their competitors' innovations.

Their existing software and system fail to match the market requirements and fit into the ever-evolving technology space. Therefore, failing miserably.

We will discuss the main characteristics of legacy software. This will give you an idea of where to look for the gaps.

When Do You Need Legacy Software Modernisation?

Legacy software can be spotted in many forms. This can be an outdated programming language that is failing to utilize your hardware resources or connect with the latest systems.

Or this can be a mainframe-based core banking system developed in the 1980s that a banking institution is using to process transactions and manage customer accounts.

This mainframe system is difficult and costly to maintain and limits the bank's ability to innovate and adapt to changing customer demands. What’s more concerning is that it may also lack modern security features, thereby making the bank vulnerable to cyberattacks, putting the financial assets and data of thousands of consumers at stake.

Thus, you can easily work out that legacy software can have serious consequences if not modernized in time. In the next section, we will have a glance at what harm legacy software breeds if not updated in time and left untouched for a longer period.

Ongoing Struggles of Not Opting for Legacy Software Modernisation in Time

Legacy software should be modernized regularly. Otherwise, they can not only slow down your growth but can bring serious damage to your organization. Here are some common harms of legacy software:

Outdated Technology

As legacy software uses outdated programming languages, frameworks, and development tools, they are no longer supported or widely used. This reduces the efficiency and compatibility of the organizational system with modern systems, thereby reducing the scope of opportunities.

For example, a retail company's legacy e-commerce platform, built on an outdated technology stack, will struggle to handle high traffic during peak seasons. It will frequently crash, upsetting customers and leading to loss of sales in the short term and customers in the long run.

Limited Scalability

Another harm of legacy systems is hindered scalability. They are designed to handle specific workloads or user bases and are difficult to scale and adapt to changing business needs, potentially hindering growth and innovation.

For instance, if a growing startup's legacy customer relationship management (CRM) system lacks scalability, it will lead to bottlenecks in managing customer data and limit the company's ability to expand into new markets.

Lack of Integration

Legacy software also has limited or no compatibility with modern systems. It poses a serious challenge to businesses looking to integrate with other software applications or platforms, leading to siloed data and inefficient workflows.

High Maintenance Costs

This drawback is easily evident in most cases. As modern systems start to take center stage, the talent shifts from outdated tools to the latest ones. This leads to a lack of specialized skills required to maintain outdated systems.

The same is true for hardware dependencies. Thus, the risk and frequency of system failures increase, draining resources that could otherwise be allocated to strategic initiatives.

Security Vulnerabilities

Legacy systems are often quite vulnerable to security threats due to outdated security measures. Their lack of updates makes them susceptible to malware and cyberattacks that modern systems can shrug off easily.

This poses risks to sensitive organizational data and may lead to breaches in regulatory compliance. For example, a healthcare provider's legacy electronic medical records (EMR) system, no longer supported by a vendor, is an easy target for a ransomware attack.

The consequences range from data breaches and regulatory fines to loss of consumer trust and a tarnished brand name.

Limited Vendor Support

Legacy systems often suffer from limited vendor support. Vendors may discontinue support, leaving organizations without access to critical updates, patches, and technical assistance. This exposes the organization to security risks and compliance issues.

Resistance to Change

Lastly, this harm is more self-inflicted. Many organizations with legacy systems avoid modernization due to concerns about disrupting existing operations. They fear changes to processes they have worked hard to streamline over the years.

Additionally, they worry about the costs associated with training employees on new systems and the perceived risks of migration. This inhibits their agility and competitiveness in the market.

Now that we have discussed the characteristics of outdated legacy systems, the time is right to explore the impacts of not addressing these issues promptly.

Long Term Consequences of an Outdated Software on Your Business

Maintaining outdated software results in multiple consequences. Here are some that you should know about:

Decreased Productivity and Profitability

Using outdated software means you're not working with the latest tools and technologies available in the market. This leads to organizational inefficiency, time and cost wastage in manual workarounds where automation could have significantly improved productivity. Increased errors and inefficiencies are other perils of clinging to outdated software systems.

Loss of Competitive Edge

The key to winning in a competitive market is innovation. If your competitors are using the latest software systems while you are stuck with outdated ones, they will gain a significant competitive edge over you. For instance, in the highly competitive eCommerce market, if your competitor leverages AI-powered AR try-ons that enhance user experience and help customers make better purchasing decisions, they will have a clear advantage over you, who might only offer product photos or videos on your website.

Legal Penalties and Reputational Damage

As legacy systems age, their failure rates increase. Organizations that choose to maintain these outdated systems rather than modernizing them face rising maintenance costs and challenges in meeting regulatory compliance standards. This exposes the business to serious risks, including:

• Financial losses: Rising maintenance costs and compliance violations can result in fines, legal actions, and damage to the company's reputation and trustworthiness.
• Decreased efficiency: Operating with outdated systems leads to lower efficiency levels, missing out on opportunities for innovation and growth.

I know this might be quite overwhelming, but don’t feel cornered. Here is your legacy system migration strategy on what you could do to have the latest and most effective software system without harmfully disrupting your existing efforts.

Legacy System Migration Strategy: 5 Steps to Safely Modernize

Step 1: Comprehensive Assessment

Assess your current legacy system thoroughly. This includes evaluating its architecture, functionality, dependencies, and integration points. This assessment will help identify key pain points, inefficiencies, and areas for improvement. More importantly, it will highlight critical business processes that must be preserved during the modernization process.

Step 2: Develop a Modernization Strategy

After the assessment, define clear objectives and goals for the modernization effort. These goals might include improving performance, enhancing security, reducing maintenance costs, and increasing scalability. Evaluate different modernization approaches such as gradual migration, componentization, and re-architecture to find the most suitable one for your organization’s needs and constraints.

It might be beneficial to connect with a legacy software modernization company. Their experience and expertise can help you make the right decisions and navigate the modernization process with greater ease, minimizing the risk of failure.

Step 3: Implement Incremental Changes

Break down the legacy software modernization process into manageable increments or phases. Prioritize the most critical and low-risk components for modernization first, ensuring that essential business functions remain operational throughout the transition.

Step 4: Continuous Testing and Validation

Implement rigorous testing procedures to validate each stage of the modernization process. Ensure that new functionalities align with business requirements and user expectations. Use automated testing tools and techniques to identify and address potential issues early in the development cycle, reducing the risk of costly errors and delays.

Step 5: Training and Change Management

Once the new system is taking shape, provide comprehensive training and support to employees who will be using the modernized system. Effective training will ensure that they have the skills and knowledge needed to adapt to changes and contribute to a successful modernization.

Bonus Tip: Implement Change Management Strategies

To ensure successful modernization, implement change management strategies:

• Clearly communicate the benefits of the modernization effort.
• Address concerns or resistance from stakeholders.
• Foster a culture of continuous improvement and innovation within the organization.

Legacy Software Modernisation Services by Hey Buddy

Hey Buddy is the fastest growing business offering technology solutions to businesses across industries. Our unique approach incorporates maintaining clear communication and fostering collaborative efforts.

Contact us today to consult on how you can safely move forward with your legacy software modernization and secure a solid market lead.

Conclusion

So that was it. We have covered it all in detail as extensively as possible. We explored what a legacy system is, its characteristics, and the ongoing and long-term consequences of not switching to a modern software system.

We also shared 5 steps and a bonus point to provide you with a safe legacy system migration strategy.

Switching to a new way of working is always daunting; however, with the right approach and guidance, you will reap all the benefits without incurring any significant loss.