A Cost Effective Low-Risk Approach to Modernizing Robust Legacy Systems

Process efficiencies, data analytics, communications & connectivity, risk mitigation, and others have most companies developing plans to modernize (or so-called “go digital”). The risks and challenges of doing so have some questioning if or how they should do it.

Many companies have developed unique systems and applications tailored to suit their business’s unique needs, providing them with a competitive edge. Written in computer programming languages of their day, such as COBOL, these systems are natively “closed.”

While the benefits of moving to modern/connected applications are identifiable, it is prudent to account for the risks. Employees develop expertise and mastery of these applications. Moving from them to an entirely new application can be daunting, and some may resist adoption. Over long periods of time, unique business practices which have been coded into these systems are not “off the shelf” in modern applications and have to be custom developed. There are examples in multiple industries of companies that made a conversion and experienced meaningful business disruption.

This paradigm has produced options that represent a middle ground. Building connections to these “closed” systems enables them to continue operating as the company’s engine, yet other applications can utilize its robust capabilities. Sending/receiving electronic documents such as Purchase Orders and Requests For Quotes over traditional EDI is both costly and cumbersome. Enabling the “closed” applications to utilize fast, efficient, and low-cost Application Program Interfaces (APIs) opens the door to delivering modern capabilities.

While this middle ground mitigates risks associated with moving a company to an entirely new platform, it also quickly delivers many of today’s needs, requirements, and efficiencies.

By Tim Herring
Member Board of Advisors, SVP Corporate Strategy