Legacy Application Modernization Strategies for Your Business Transformation

As companies strive to keep up with the perpetual churn of the market, they may run into issues with maintaining legacy applications or systems. One thing that you definitely wouldn’t want as a business owner is to drag behind the competition because you heavily rely on using an old system that has seen the highlights of its existence back in the 80s. That’s what legacy applications can be roughly described as.  

It may not be obvious, but according to Dell’s market research, an estimated 80% of what companies spend goes to the upkeep of legacy applications. More often than not, this isn’t really justified. 

Companies rely on legacy applications for running operations with no alternative tech solutions. The price that they have to pay for it, apart from the literal cost of maintaining legacy applications, among other things, is lack of security, non-compliance, risk of losing important data, and overspending on maintaining a system that no longer carries its own weight. What’s even more concerning, the company may begin to stagnate as the limitations of a legacy system render it unable to deliver new features within a reasonable time and budget. 

What is legacy application modernization? And what is the goal of it? 

Legacy modernization is the process of bringing your business systems up to standard with the latest technological and market demands. As a result, you get a system or an application that is more efficient and compliant with industry regulations. It is able to perform on par with the more technologically advanced competition and deliver on customer expectations. 

The ultimate goal of application modernization is to bring forth your digital transformation journey and create a system infrastructure that helps you thrive in the turbulent market. When you take your legacy application through the modernization process, what you achieve is the following: 

• Establishing a standard. As the market is changing, so is the understanding of what is “up to standard”.  
• Staying competitive is one pursuit of any business that always stays relevant as you operate in a market rather than a vacuum. 
• Meeting customer expectations. What value you bring to the customer can rely on you utilizing the latest technologies and making your delivery faster, more reliable, and of the highest quality. 
• Utilizing modern technologies to the max. New technologies emerge and change the way business works. Leveraging the advances of modern technologies such as AI, cloud transformation, etc., is good for your competitive advantage. 

Why you need legacy system modernization: Benefits for business 

Although the old saying goes “don’t fix it if it’s not broken”, it may as well be that this piece of wisdom needs a bit of a shakeup itself. Legacy software modernization benefits the business and introduces a higher standard for the products or services that you provide. Having a sound technological solution comes with its own set of perks. 

Security. If you are working with personal data, a legacy system will put you at risk of non-compliance with GDPR, as the security standard and requirement for processing personal data in the EU implemented since May of 2018.  

Cost of maintenance. Legacy applications may become a budget burden with overwhelming costs for maintenance that are not reflected in the value that you’re getting out of the application. With modernization you can greatly cut expenses and end up getting more of your money’s worth. 

Cost of new feature delivery is incompatible for when you are working with a legacy application or a modern software solution. You may run into issues with finding experts qualified to work with the legacy system and the scarcity of the skill set inevitably drives up the cost. 

Addressing technical debt is crucial for maintaining a healthy system. As time goes on, a legacy system will reveal more and more gaps in functionality compared to a modern solution. 

Legacy system modernization approaches 

When upgrading legacy systems, there are two main routes to take – revolutionary or evolutionary modernization – which differ in scale but should be seen as alternatives rather than the opposite. What approach you choose largely depends on the current state of your legacy system and what goal you pursue in your legacy modernization journey. 

Revolutionary modernization 

Revolutionary modernization needs to be applied in cases if the system is no longer being supported by the vendor or updated and hence is posing a risk of security breaches or incompliance. These and other reasons lead to your legacy application becoming a risk and further hesitation with modernization can lead to significant loss or damage to your regular business operations. This approach means building ‘from scratch’ a new system that is compliant and relevant to your current tech and business needs. 

Pros: Holistic approach, prevents system damage and data loss. 
Cons: Expensive, presents risks to business continuity. 

Evolutionary modernization 

The evolutionary approach to legacy modernization is a more gradual process that unfolds over time, giving the organization a chance to weigh all risks and routes, and see to it that your system architecture doesn’t collapse while you’re at it and interrupts regular business processes. For instance, this can mean moving your application to the cloud in “chunks” or individual functional segments. 

Pros: Helps avert risks, gradual spending over time. 
Cons: Slow, multi-step process. 

Legacy application modernization strategies 

We can define the “five Rs” of legacy application modernization that are the strategies a business can follow on its modernization journey. 

• Replace your old legacy application with a new one, that corresponds to your current requirements and business needs. For example, you may want to update and optimize the infrastructure, or migrate an outdated on-premise system to the cloud. This is a fast yet probably the most expensive strategy for legacy application modernization. It runs a risk of losing data or disrupting usual business operations. Smooth replacement can be done with appropriate system assessment and getting on board with a DevOps team that would provide a full scale of services, from cloud native development to cloud managed services.  
• Rearchitect and change the code to improve its structure and address existing technical debt. This is a more involved strategy that implies using new technologies and changing parts of the code, mainly on the backend, to enhance system performance. However, it’s not as disruptive and carries less risk than completely rewriting the code or replacing the system altogether. The difficulties that come with this strategy are that there may be limits to what you can do with the existing code. 
• Replatform your system in those cases if it’s still able to perform and doesn’t require substantial changes to its structure, functions or features. In this case, you can make the shift to a new platform with minimal changes to the code and preserve the integrity of your legacy system yet benefit from having it run in a new environment (e.g., improved performance and enhanced security with cloud infrastructure). This approach to upgrading legacy systems allows for improving the overall performance with minimal costs and effort. 
• Retain your legacy system in case there is no immediate need for a drastic upgrade. However, this strategy is only a short-term solution meaning that there should be a plan further down the line for retirement of the system or merger with a modern solution for your infrastructure. If the latter is the case, you may need to build ‘bridges’ for easier integration down the line. 
• Retire the system if you discover that it’s no longer of any benefit to you and it would be better to move your data and users to a system that is already set up with sufficient functionality to carry on business operations as required. You may need a redesign to streamline the data and optimize business processes. 

Tips & considerations when choosing a legacy modernization approach 

Some things to factor in when deciding on your approach to legacy modernization would be the following: 

• Assess your workloads. What is the state of cloud-readiness of your legacy application? Audit your system and determine the excess and business value of your workflows to understand how to approach modernization without business disruptions.  
• Architecture. Analyzing your system architecture can help find performance shortcomings and weak points that would benefit from an upgrade. 
• Financial load. Is your budget already stretched thin with supporting an outdated and burdensome legacy system? Address your overspending by optimizing resources and investing in future improvements that will alleviate the budget burden and improve ROI. 
• What are the migration risks? Are you running into compliance and security risks with your current legacy system? Does it require immediate intervention or if you can approach its modernization more gradually over an extended period of time? 
• Operations. Optimize your business operations. Support your teams in acquiring new important skill sets and invest in their training. Improve and modernize business processes. 
• Take care of security. How secure is your legacy system and what is the best way to secure it going forward? A system audit may help you assess its current state and find gaps in security. Also, when proceeding with system modernization, see to it that you avoid data loss and exposing your system to possible attacks. 

Conclusion 

If you’re a long-time runner in the market, you may find yourself using applications or systems that have been serving you for many years but are no longer able to uphold current day industry standards. The best way to make your business compatible in the ever-changing market is to pursue a modernization journey that would help you bring your standards up to par and provide the best quality services for your clients. If you know your business needs and objectives and are aware of risks that come with any drastic changes, or lack thereof, to your business ecosystem, you will be able to pick just the right legacy system modernisation strategy and remain eligible for the ‘race’.