Blog: 5 Reasons to Upgrade your Legacy Systems

Companies need to think ahead and being to upgrade legacy systems as they may not provide required capabilities moving forward

As comfortable as those old pair of slippers feel when you cozy up by the fireplace, the fact remains that at some point, the wear and tear will catch up with them, and they may not meet your footwear needs. No matter how much you love them, you’ll have to consider replacing them with a newer pair.

And just as comfortable and reliable as your legacy systems may appear to be on the surface, sooner than later IT departments will have to decide whether to modernize their business processes and applications or risk getting left behind the competition. 

Before, we begin, let's first define a legacy system. 

What is a Legacy System? 

A legacy system is an outdated piece of software and/or hardware that is still in use. The old legacy system is still functional but it is not scalable. Oftentimes, legacy systems will not allow you to connect to new trading partners, cloud applications, or other new solutions. But the inherent integration problem that comes with using legacy systems is barely the tip of the iceberg. 

3 Costs of Maintaining Legacy Systems

1) Security Risks 

Legacy systems often present a security risk because they are inherently older technology and are not supported by the company or vendor that created them in the first place. Lacking regular maintenance, legacy systems with vulnerabilities will not see the updates and patches necessary to stay secure in the modern world. Poor data security presents a risk to every organization no matter the industry.

2) Inefficiency and Unpredictability

Most legacy systems were functionally efficient for the year they were constructed, but with the rapid advance in technology driving modern business practices and productivity, old systems can hamper productivity and contribute to an inefficient process flow. An example of inefficiency might be a legacy system is unable to handle multiple data types or retains latency in data movement due to one-off or customized integrations.

3) Lack of Insights and Information

Modern software applications are expected to have advanced reporting metrics and deep data insights, supporting critical business decisions with verifiable information built into the platform. When it comes to visibility into data flows, legacy systems cannot keep up. For example, a legacy system might not have error identification or resolution processes built into the platform, resulting in constant friction in identifying and fixing exceptions

With the Cost of Maintaining Legacy Systems, Why Use Them in the First Place? 

In short, legacy systems are difficult to replace, especially if a system plays a role in powering critical business processes. For some organizations, the importance of legacy systems cannot be understated. Without the old system, the company cannot function. 

Additionally, replacing an old solution with a modernized system often requires an up-front investment from key internal resources and dollars from the overall company. Beyond the cost of upgrading old technology, legacy systems tend to require extra resources with specialized skill sets to manage, which don’t support the agility, flexibility, and streamlined business operations that enterprises demand.

Sometimes the tools and systems you’ve relied on for years just work for your business and will continue to meet your daily business needs for the foreseeable future, but all systems have a shelf life.

The inability to meet new business challenges head-on ultimately will limit growth, and maintaining legacy systems prevents business scale. If you are receiving chargebacks from your trading partners or if your system is a decade old, it is likely time to consider modernizing your EDI solution. 

When you’re ready to bring on new partners and services, migrate applications to the cloud, or support big data initiatives, legacy systems will not provide the capabilities that are required to be successful.

Five Questions to Ask About Your Existing Systems

Before deciding to modernize IT operations, an enterprise needs to have a complete and fundamental understanding of its systems currently in place. And to gain that understanding, there are five questions that an enterprise must ask itself:

1) Are you able to accept and process multiple data formats from all internal applications and partner systems?

2) Do you need to customize integrations to connect to new applications and trading partners?

3) Are you able to expeditiously handle increased volumes of data from new applications and trading partners?

4) Are you able to identify data processing errors and resolve them quickly?

5) How much investment is tied to supporting legacy systems, such as chargebacks, development expenses, and maintenance costs?

If any of the answers above are unsatisfactory, it may be time to examine migration from legacy systems to the cloud. 

The Role of Integration

There certainly are other considerations the enterprise needs to weigh when contemplating the modernization of its IT systems (cost, technology, and business needs, etc.), but the most important one centers on whether the business can adequately integrate any new technology into its current IT stack. And that is why integration technology is so critical to any IT modernization project.

Enterprises stand to significantly improve their data exchange capabilities, enhance partner relationships, and also reduce the risk of costly errors by consolidating integrations among your business systems. Organizations that do decide to replace a legacy system must ensure that they can quickly and easily make the move without disrupting existing business workflows and processes, and enterprise integration technology enables a successful data migration.

With a centralized integration platform that flexibly supports an automated and seamless flow of all data exchanges, companies can take on new systems to support modern business requirements.

Why Modernize Legacy Systems

Once the decision is made to replace and upgrade your legacy IT systems, a centralized integration platform will deliver several important benefits. Here are 5 legacy modernization benefits:

1) Onboard new applications and partners faster

2) Provide faster responses to changing partner requests

3) Access real-time data transaction views

4) Provide end-to-end data governance to ensure compliance

5) Receive automated notices should an issue arise to quickly identify and resolve errors

Your Legacy System Replacement Strategy

In today’s modern enterprise, speed is the name of the game. And with a centralized integration platform, enterprises can connect with trading partners faster and better serve their customers. Cleo Integration Cloud allows you to connect, integrate, and analyze every single end-to-end data flow between your ecosystem of customers, partners, suppliers, or external applications as well as your internal business systems.

Cleo Integration Cloud provides enterprises a comprehensive, complete solution for all B2B, application, and data integration needs. Featuring the flexibility to be deployed on-premise or in the cloud, as well as additional in hybrid environments that include both self-service and managed integration service options, Cleo Integration Cloud allows businesses to integrate anything, anywhere.

Download “The Common-Sense Guide to IT Modernization” to learn more about what it means to modernize, how to support legacy IT systems replacement, and how an ecosystem-driven integration platform enables enterprise agility, insulates organizations from disruption, and support digital business transformation.

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