Modernising Legacy Systems? You Should Know This


While modernising legacy systems is an inevitable business strategy that needs intensive planning to avoid disappointing results

Vulnerability ‘Apache Struts CVE-2017-5638.’ The Equifax security team probably still shudder at the sound of the name today. 

Five years ago, on June 29, the team noticed suspicious network traffic. In September, they faced defeat and resigned to make the public announcement that scarred the brand reputation forever. They never expected it to blow out of proportion but the Equifax security breach of 2017 that affected 148 million people could have been prevented. 

The critical vulnerability remained in their legacy system for 145 days and the company also failed to renew 324 security certificates. The crude reality was this: The IT team was forced to work on a legacy system built in the 1970s that they knew so little about. Being unaware of its patch management policies, the company had it coming. 

Modernising legacy systems can be extremely challenging for CIOs. Having designed a robust system in the early 2000s, only for it to be broken down and redesigned to fit in the new, innovation driven world is vexatious. Almost all legacy system transformations are labour intensive, complex, and even if successful can be disappointing. 

Nonetheless, it is necessary. 

A report by Lemongrass 2021 Legacy-to-cloud reveals that 77 per cent of IT leaders believe that the primary motivation for the migration of legacy applications is to secure data. Legacy modernisation is necessary, and with proper research, guidance, and strategy, it can be far more beneficial to the company. 

Mission: Modernise for Satisfactory Results

Legacy modernisation can either be achieved with migration tools and emulators to refactor code or the company would have to redesign the entire structure of the system with cloud-native development tools.

While most companies find better opportunity costs in projects that can be easily transformed into the cloud, the challenge in modernising legacy systems is given a fair shot as brands sometimes cannot let go of, their legacy applications. It need not be an impossible task. Then why do many enterprises fail? 

According to a 2020 Mainframe Modernisation Business Barometer report, 74 per cent of organisations failed to complete their legacy modernisation program. One of the biggest reasons for it is the disconnect between business leader decisions and technical team operations. A major transformation cannot be a stop step process. It requires a cooperative, structural business approach that can also minimise upgrade costs while maintaining its functionality and UX standpoint. 

Also Read: 5  Ways Cloud Is Helping Banks Drive Operational Resilience 

Set the Priority List

Some legacy systems have several working applications working, and the company might have the bandwidth to only work on a single application at a time. Making a list of all the available applications, along with a modernisation-priority classification, should be the initial task of the modernisation team. Experts recommend organisations to visit and update the classification at regular intervals as priorities might shift, and some applications that were not considered to be legacy applications then can be now. 

Some legacy systems involve simple replacements that work well with the new requirements. For instance, an in-house legacy CRM system can be replaced with Salesforce CRM or an in-house legacy email system can be replaced with Microsoft 365. While it is the easiest method, not many brands are comfortable dumping their in-house systems. While they can scout for alternate methods, it is important to not lose sight of the possible repercussions and risks. 

Gartner suggests seven possible modernisation techniques: encapsulate, rehost, replatform, refactor, re-architect, rebuild, and replace. For instance, GE Capital chose to rehost their mainframe legacy system to an OpenFrame platform, TmaxSoft. The company was able to reduce 60 per cent costs and witness improved agility.

Meanwhile, replacing with SaaS outright can be a faster route to the cloud, though it requires a significant amount of planning. IT teams must determine how existing data will be migrated and leveraged in the new system and account for the business disruption of user training and learning curves. You may also consider evaluating enterprise platforms or systems that meet the business need and host it in a modern cloud environment. Another strategy would involve technologies such as containers, service meshes, declarable APIs and microservices. For instance, DBS Bank successfully restructured its system into 33 different platforms with API layers. 

While several brands evaluate their options through Gartner’s method, experts recommend two other perspectives before arriving at a decision. 

The Revolutionary or Evolutionary Approach

When a company acquires or merges with another company, a complete infrastructure transformation is required. Such a revolutionary approach to legacy systems is inevitable if the system needs to quickly adapt to the new environment. Also, when the legacy system starts to become a risk to the company. For instance, vendors no longer support the legacy system leaving it with compliance and security issues without new updates. Under such circumstances, rapid modernisation is inevitable.

On the other hand, certain brands that are confident that their legacy system can hold it together for a while longer, choose the evolutionary strategy. It is a long-term approach, with a multi-phased model that is tasked with the same end goal as the revolutionary approach. The only difference is that the process is slow to ensure perfection to reduce business disruptions and avoid a sudden empty pocket situation. Experts believe that brands that are bound by vendor contracts would prefer this strategy. Additionally, the process gets easier when hybrid models of cloud and on-premise environments offer support to the evolutionary transformation. 

Also Read: Leaving A Legacy of Cloud

Evaluating The Priority Need

Is the transformation necessary? Is it urgent? Do we have enough funds to conduct the whole process?

Several components need to be questioned and counter-checked before making the transformation decision. Auditing the applications and software to fetch business insights on value, criticality, and opportunities is one of the basic, but often skipped steps. Experts also recommend reviewing the legacy architecture, its performance and ROI.

Meanwhile, the modernisation of legacy systems is a high-cost process. Determining the possible budget, and evaluating the financial burden on the company is a crucial step to make sure the process is not halted due to insufficient funds in the middle of the transformation. It might increase customer churn rate and cause a dent in the brand reputation.  

Calculating all the risk factors and potential future impacts on business operations is the final step. It is important to assess the possible organisational cultural impact that a modernisation project might unleash. Maintenance for out-of-support systems and limited staff might cause employee experience complications, and in the process, upset the business value of the company. Experts recommend new skill set training programs or hiring programs to avoid such operational risks. The most crucial risk factor is security, and security strategies that supervise data loss, and industry compliance regulations in the cloud environment are essential. 

There are several vendors and SaaS platforms that offer legacy system modernisation services. For instance, Rackspace Technology works with a strategy that puts Process First, Technology Second. Another platform Wave- TSG has been at it for over two decades. They strive to let brands attain maximum ROI from their legacy systems by adding modern upgrades, introducing business intelligence, or AI-driven solutions and ML tools. 

Keep an Eye Out for Obstacles

The legacy modernisation process can cause business transformation resistance. In such cases, experts recommend enterprises shift their focus to the business process and then move on to the technological aspects. With proper planning and a re-development process, the negative business impact both culturally and technically can be averted. 

A word of caution: Several companies find it challenging to collect the required data points and avoid data management constraints. Experts suggest a thorough clean up of the business data across networks and infrastructure to avoid the bad data dump into the modernised system. 

Only a robust and agile digital landscape can help companies with stability. A 2019 study by ResearchAndMarkets predicts that the transformation market will rise from $9.7 billion to $16.8 billion in 2024. The pandemic has rushed digital transformation and modernisation with it. In the Middle East, healthcare organisations have several siloed legacy applications that are possibly hindering health and wellness. While the region is looking to carefully modernise the healthcare industry, the other industries are right at its heels.