The thing with good software is that the user becomes used to it. To such an extent that it becomes part of the process, no matter how inefficient or costly it gets over time. Even organizations who are leaders in their niche are found to be holding on to a vintage software because the users are reluctant to adopt a newer system.
The Reasons Behind Sticking to an Outdated System Range-Wide:
- Why do we need a new one when the old is not completely broken?
- What if the transition to a new system hampers the business process?
- What if there is low user acceptance of the new system?
- What if the new system fails to register ROI?
These are legitimate questions and demand a brainstorm session between stakeholder organizations and the firm undertaking legacy system modernization.
But many a time, users fail to recognize that the system is not just ‘a little inefficient’ but a ‘legacy.’ Here is a list of 10 identifiers to help you decide if your system is a ‘legacy’ and needs to go.
Slow and Crashes Often
Perhaps the first teller of the legacy system is being slow. Ruling out the reason that the software could be just a bad build, a slow software reflects incompatibility to communicate with other systems, inability to process the specified volume of data, or cater to more users retrieving data at the same time.
If the software often exits by an unhandled exception and your IT team has to run the whole diagnosis without any concrete solution, it is time to modernize. A minute-long disruption of the business process can lead to missing a business opportunity, poor customer experience, and overburdening of IT resources to keep the outdated system running.
Disproportionate Hardware Use
The next big sign of a system turned a legacy is that the technology demands on-premise hosting or more hardware than the rest. In the era of SaaS, PaaS, and IaaS; hosting a software on-premise is the cave-man version of software usage.
Hardware has its own cost of maintenance, adding to the total cost of ownership (TCO).
As per research by KPMG, the TCO gap between traditional IT and public cloud services is 30-40%. In the case of traditional IT framework, an average 30% of budget spend is over infrastructure. Cloud Migration can save 10-20% of the annual IT budget, which can be redirected to core functions.
If your software can run only on computers at office premises, it is a legacy. When the workforce is globally distributed and BYOD (Bring Your Own Device) culture is the norm for startups, having an IT set up which is restricted to a particular device or a location limits the capabilities of the organization.
Processes like Sales and Marketing require connectivity for incremental efficiency and granular visibility. Having an immobile software prevents them from utilizing their full potential. In a survey conducted by Gartner, 70% of CIOs cited mobile
technologies to be most disruptive. Hence, device dependency can be detrimental to the extent of causing a complete uproot by competitors.
Incompatible With Other Systems
Components of a modern IT framework communicate seamlessly paralleling the needs of different departments. If the software is unable to retrieve from and push data to other systems, it is a legacy. For optimal results, standard business applications like CRM, ERP or CMS need communication. If tethering to an outdated system is costing you data flow between business processes, it is time for legacy system modernization.
It is important to understand that workflows need to be swift to cater to end-user demands. A heavy-weight, siloed legacy software causes operational drag and therefore costs business an opportunity to focus on core functions. It also causes the poor experience of employees, especially the new hires and millennials.
Hard to Add on New Integrations
If your system requires extensive development effort or is incompatible for integrations at all, then it is time for modernizing the software. APIs have facilitated new avenues for communication between different B2B and B2C companies. Disparate services are teaming up to bring a novel packaged product/service. For example, CRMs have integrations with messaging apps to communicate with customers at their platform of choice.
Even if you stick to your system and refactor a part of it to facilitate one particular integration, it will still be a challenge for future integrations. Integrations are big revenue streams. For example, Salesforce– the CRM giant, earns almost 50% of its revenue through APIs. Moreover, to make use of new-age technologies, like Machine Learning, integrations are required to extract and process the data.
If your system has had a security breach, it is either an inferior build or obsolete. Retention of outdated and siloed systems is a sureshot invite to security breaches. A recent example is WannaCry ransomware attack that was due to exposed legacy systems. It cost approximately USD 4 billion in its spread of 150 countries. Universities, hospitals, and airlines were some of the organizations that reported vast losses due to the malware.
Even if legacy systems are prepared through isolation, hardening, and constant monitoring; they are at high risk for exposure. Howsoever strict is the access control, even single access coupled with no communication to other systems and on-premise back-up has the potential to expose the system.
With the expansion, a business requires enhanced communication between teams, processing of huge volumes of data, and appropriate security measures to prevent a breach. If your system uses excessive hardware, has limited or no communication with other systems, and is difficult to add integrations; it is challenging to match its scale with business growth.
Declining Number of Software Experts
If the experts of your software are hard to find and are retiring, it is wise to look for an alternative and migrate data to a newer system. Antiquated technologies get costlier to retain even if they are serving the purpose because maintenance resource gets scantier, young talent is not experienced enough or requires extensive training.
Vendor Support Called Off
There can’t be a bigger sign of a system gone legacy than the vendor calling off the support. When the system users are fewer, talent is scarce, and newer technologies need investment, vendors announce calling off the support. But usually provide a quarter to year-long period before an absolute stop. This phase is the last bet to find an alternative and upgrade the system.
High Operating Costs
When TCO of the system is not justified, it is time to look for inexpensive and modern software. High operating cost is derivative of other factors like costlier hiring and onboarding of trained resources, continuous patching and refactoring for data security, and costlier development for new functionality or integration. The opportunity cost of the core business, such as productivity loss due to poor communication, is rather difficult to estimate.
Legacy system modernization is a critical decision that has implications on data security, business process workflows, employee skilling, IT ecosystem, and finance. Hence, it should be a decision arrived after consideration into factors like business performance and readiness for use by the existing workforce. Modernization is hardly a ‘lift and shift’ scenario and requires careful planning.
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