Legacy System Definition | 4 mins read

Legacy System Definition & Concerns For Business Owners

legacy system definition concerns for business owners
Hanh Truong

By Hanh Truong

Introduction - Legacy System Definition

Despite the frequent advancements in technology, many businesses are still utilizing legacy systems. In fact, a study by Dell reported that 70% of federal IT leaders in the U.S., Germany, Japan, UK, Brazil, India, and China use legacy platforms. While it may get the job done, these outdated programs and applications can stunt a business's growth and slow operations. By taking the appropriate steps to modernize, companies can cultivate a competitive edge and enhance productivity.

Legacy System Definition

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Legacy systems are older and outdated computer programs, software, and hardware. These applications are developed and designed to meet specific needs. Due to its outmoded technology, these systems cannot be updated and they often cannot be connected to modern platforms. Therefore, businesses will not be able to take advantage of new solutions, such as cloud computing and advanced data integration.

Recent studies have shown that 80% of IT leaders believe that not modernizing technology systems will negatively impact the long-term growth of their company. However, only 1 in 3 organizations does so on time. The following are common reasons why some businesses still use legacy systems.

  • Money - Although legacy systems require costly maintenance over time, modern systems typically need an up-front investment that a company may not have on hand.
  • Fear of Change - Innovating an entire business system will lead to new changes for the company. Business owners may be hesitant at the idea of revamping their plans, processes, and values.
  • Difficult Data Integration - Some legacy software is built with obsolete programs. Therefore, it can be difficult for companies to process, migrate, and integrate data into a new system.

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Problems Caused by Legacy System Definition

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Legacy technology systems can cause various issues and delays to business operations. From silos to lack of compliance, these risks make legacy tools inconvenient. The following are some of the most prevalent problems that can occur due to outdated software.

  • Ineffective and Costly Maintenance
In order for legacy systems to operate, businesses must invest in costly maintenance periodically. This is a futile investment because, eventually, legacy systems will become too outdated due to the lack of specialized support and ITs in the future. Therefore, in the long run, businesses are wasting their capital to keep these tools running.

  • Data Silos

Data silos are a common occurrence when using outdated technologies. These systems are often built to work independently, without integration to another platform. This means any data and information in the legacy application will remain there and cannot be moved.

  • Obstacles in Compliance

Companies have a set of industry regulations and federal laws that they must abide by. Legacy systems are built to ensure organizational compliance. However, rules frequently change, especially with the government passing new laws each year. And since legacy tools cannot be updated, they will not be able to align to new standards.

  • Weakened Security

Legacy applications are vulnerable to cyber threats, hackers, and data breaches. While these tools may have been effectively programmed to safeguard data when it was built, cybercriminals are constantly evolving. Therefore, prior security measures that worked will not be effective in modern times.

7 Best Approaches to Modernize Legacy Systems

The various risks of legacy systems can cause great delays and damage to an organization's operation and reputation. Businesses can prevent these problems by modernizing their solutions. The following are the best approaches to updating business technology.

1. Use a New Platform

Business owners should look into implementing a new application, software, or platform for their company. Many providers enable users to use the same data structure and organization to prevent an overall change.

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2. Leverage Capabilities

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Many of the new software programs and systems have different features and capabilities. For example, some business system providers have multiple platforms for inventory management, employee scheduling, and reporting analytics. They also provide integration software that allows for a seamless connection between the different applications. Organizations can take advantage of these features to streamline their workflow.

3. Transfer to the Cloud

Business teams should gather their data, information, and documents from legacy systems and store them in a cloud infrastructure. This allows users to access business details and figures remotely from any Internet-connected device.

4. Restructure and Recode

Organizations should employ an IT team to restructure and enhance existing codes in the legacy systems. This can help with enhancing the platform's features and structure.

5. Rearchitect Codes For Transport

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Legacy system programing can be recoded to make the data migration process to a new platform easier. Doing so will allow the business to retain all its historical data. Additionally, they can leverage new features on the modern platform.

6. Build the System Again

Businesses can rebuild or rewrite the legacy software program from scratch. They can then incorporate codes that allow for updates while preserving its useful functions and data.

7. Replace the Application

The legacy application can be entirely eliminated or replaced based on its importance. For example, if a company is transitioning to selling solely online, it can remove its legacy point-of-sale system.

Legacy systems are outdated and will continue to obstruct a business's growth if it is not modernized. By following these key tips, organizations can protect their operations and streamline their workflow.

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