With computing best practices and coding frameworks changing all the time, the modernization of legacy systems is an ongoing process. Small businesses, large corporations, and government organizations are all plagued by legacy systems that have been in use for 5 to 20 years.
When a system is built on dying technology or an internal team lacks the appropriate skills, future innovation can suffer. Not only that, but in the present moments, you’ll likely be paying higher costs to maintain that system than you would if it were built with lightweight, modern technology.
In this guide, we cover the types of legacy systems often in need of modernization and the top approaches to consider.
What’s in this guide:
- What is legacy system modernization?
- Statistics on legacy system modernization
- Types of legacy systems that need modernization
- Reasons for updating legacy systems
- How to approach modernization
What is legacy system modernization?
Legacy system modernization refers to the practice of rebuilding and refractoring old software, cloud architecture, operating, and other systems in order to bring them up to speed with modern times to achieve a better user experience and more reliable performance. Most importantly, legacy system modernization paves the way for future innovation, because organizations can more easily achieve feature updates and attract talent that expect to be working with modern frameworks.
Hanging on to a legacy system for too long can spell disaster for an enterprise or result in massive productivity losses for a government organization.
Statistics on legacy system modernization
Just how bad are legacy systems?
Here are some statistics that put their impact on expenses and innovation into perspective:
- Organizations have 31% of their systems made up of legacy technology on average.
- IT departments spend 60 – 80% of their budgets maintaining legacy systems.
- Over 90% of businesses are held back by the burdens of maintaining old technology.
- Improving customer experience is the main motivation for modernizing legacy systems with 69% of businesses rating is as the top reason.
Types of legacy systems that might need to be modernized
The term “legacy system” can refer to just about anything. What does this actually mean?
There are many different types of legacy systems that require modernization. Below, we share some of the common use cases.
1. Customer-facing applications
One of the most common types of software modernization is when a software provider rebuilds or re-architects the products that they offer to customers.
The company might be working to keep up with new disruptors, or they might be innovating the path ahead and forging better customer experiences.
Fleetpal recently released news of their successful software modernization project. The platform is a fleet management software, and with their new update, customers can now manage their fleet in a completely digital manner. The system now allows customers to do away with paper logs completely.
Customers can access analytics, reports, schedules, and asset data from the cloud.
2. Internally-used tools
Software isn’t just created for customers, of course. Corporations and government agencies create software for internal use. These tools might be used to analyze data, complete important processes, or ultimately to serve end users.
Internal software that is outdated can present major risks in terms of productivity losses, cybersecurity attacks, and employee dissatisfaction.
The Department of Defense released their Software Modernization Strategy to outline the department’s goals for achieving resiliency and efficiency with the software they create and utilize.
This is an excellent example because the report is full of details of potential risks and crises that the department will face if their processes for developing and maintaining software aren’t modernized.
“The DoD Software Modernization Strategy sets a path for technology and process transformationThe Department of Defense’s Software Modernization Strategy
that will enable the delivery of resilient software capability at the speed of relevance. It is one in a
set of sub-strategies of the DoD Digital Modernization Strategy and builds upon, evolves, and
replaces the DoD Cloud Strategy. Given software’s role and pervasiveness across all aspects of
mission capabilities and supporting infrastructure, implementation success of this strategy will rely
heavily on partnerships across the Department.”
3. Data management systems
This category is similar to the one above in that it covers internally used software created by a corporation or organization. But it’s slightly different in that the main use case here is internal data management systems, such as CRMs.
Corporations might be using outdated systems to track customers, and government agencies might be using outdated systems to track assets or employees.
These old systems can make it impossible to connect with modern SaaS solutions or to make internal processes more automated and efficient.
The US Ski & Snowboard team was plagued with an inefficient data management system for tracking Olympic athletes as well as tens of thousands of young athletes from around the country who participate in the organization’s ski clubs.
The outdated system made it difficult to create better UX for new applications. The US Ski & Snowboard team worked with DevSquad to modernize this system, create a new application portal, and launch their first e-commerce store (fully integrated with their internal systems).
4. Industry-wide systems
Sometimes, an entire industry can be plagued by outdated software. If a company has to use an industry-standard system, then they won’t be able to make their own internal process improvements. They’ll be burdened with the challenges of that industry-standard system.
The mortgage industry is an excellent example of this. It is notorious for being incredibly slow, and for lacking transparency. When purchasing a home, buyers have no idea where their mortgage loan is in the process, and never know what the lender will ask for next, or how long it will take to hear back about a certain step in the process.
For these reasons, many different companies are working to modernize the mortgage industry.
5. Analog systems
Some organizations might still be plagued by systems that rely on completely analog work or a mix of analog and digital work.
Meaning, a customer or end-user might have to submit a paper form, which is then entered into an outdated system.
The National Archives and Records Administration is investing millions of dollars to upgrade two legacy systems, the Archives and Records Centers Information System (ARCIS) and the Case Management and Reporting System (CMRS). These systems are partly paper-based and partly reliant on outdated software. They will be updated to be fully cloud-based for more efficiency and to assist remote work.
“These systems were developed in the early 2000s, and the software requires extensive customization, which is labor intensive and not cost-effective to maintain. The investment will allow veterans and their families to electronically request and receive their records, while improving responsiveness as the agency transitions toward digital recordkeeping. It will also allow NARA staff to fulfill records requests remotely, fully digitally and securely.”
The Future of Federal Case Management Modernization, Sarah Sybert
6. Operating systems
Legacy systems can also refer to the operating systems used for factory machinery, computer processors, motorized vehicles, and dozens of other devices.
Outdated operating systems can threaten to put devices out of commission if the OS can’t be updated. There can also be safety concerns, particularly involving machinery and vehicles.
The military is rife with examples of legacy systems that can pose real dangers if not modernized. Today, airplanes, helicopters, and other aircraft come equipped with technology to help pilots land in conditions with poor visibility. Military engineers are working to update the operating systems of older aircraft, so that they can stay in use. This keeps troops safe while saving on the cost of replacing all aircraft.
Reasons for updating legacy systems
Legacy systems can cause a lot of problems. These are the top reasons why organizations take on the massive project of modernization.
- End-of-life technology – Certain systems might have built with technology that is simply at the end of its life. It’s no longer in use or is on its way out.
- Lack of system knowledge – If your team doesn’t have the appropriate knowledge of your legacy system, then your company won’t be able to maintain it or make upgrades. If new staff or third-party agencies can’t figure it out either, then you’ll be forced to undertake modernization.
- Lack of necessary skills – When systems are very outdated, there are fewer available staff who have the appropriate skills needed to maintain them. For example, Joomla! was a popular CMS and website-building platform from 2005 to 2011, but it hasn’t been updated since 2013, so it would be very difficult to find staff members who know how to use that platform.
- Challenging to update or add features – Out-of-date technology might not be supported or updated by its original development team. This makes it hard for your team to make updates to whatever systems you built with that technology. This is where the innovation losses come into play. You might not be able to make simple changes or add even basic features that customers are requesting.
- High downtime – Legacy systems can be subject to a lot of downtime and performance issues. This can cause customer frustration, customer churn, high volumes of customer support tickets, and plenty of internal fires to put out.
- Not scalable – Does your legacy system crash when you scale up to higher workloads? If so, it can keep your organization behind. You won’t be able to easily add new users, whether those users are customers or staff.
- Unnecessarily high maintenance costs – The cost of maintaining legacy systems can easily be 20-25% higher than if you were using modern tech. These costs can be made up of staffing, hardware, and other resources, as well as the lost opportunity cost from not innovating faster.
- Lack of interoperability – If your legacy system can’t easily integrate with modern systems and platforms, then you won’t be able to implement new services and solutions. That in itself can be reason enough to undergo modernization.
Ways to approach legacy system modernization
How should you tackle modernization? There’s no one right answer. You’ll need to work with modernization strategists to determine the best path forward based on your organization’s goals, the future use cases for the system, and the viable options available.
Here are some of the most common ways to handle the modernization of legacy systems:
- Refactoring – Rewrite, optimize, and restructure code, but keep the same system functionality so that the system is easier to update, maintain, integrate with, etc.
- Rebuilding – Redesign and re-envision the system, removing unnecessary functionality and adding new features to appeal to end-users and solve current problems.
- Replacing – Completely replace the system with an existing service or product offered by a third-party provider, or replace it with a custom-built tool that offers a very different approach.
- Rehosting – Deploy the application to a different host without changing the code or functionality.
- Replatforming – Change the system’s platform, without making major changes to the design, code, or functionality.
- Rearchitecting – Deploy the application to a new architecture and make the necessary code changes.
Modernize your legacy system
The longer you wait to modernize your legacy system, the higher the maintenance costs you pay and the more opportunities you lose out on. When you modernize systems and applications, you can positively impact the customer experience and internal efficiencies while reducing risks.
To learn more about starting your project, create an application modernization roadmap.
Ready to modernize? Check out DevSquad.