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Legacy System Modernization Strategies for 2023

Are you struggling to modernize your business's outdated legacy system and stay competitive in the fast-paced digital landscape of 2023? Well, you’re at the right place. As technology advances, old business systems can easily become outdated and impede growth. Many companies are facing challenges in modernizing their legacy systems. According to Forbes, the biggest challenge in implementing new technology is change management. To change a legacy system, first of all, assurances should be made that jobs will remain safe. (Source)

Another challenge is making the business case for legacy system modernization which can be challenging in companies where the mindset remains resistant to change. Hyper automation, cloud migration, CI/CD implementation, augmented analytics, A/B testing, DevOps process, and the development of AI chatbots are some of the top trends for legacy system modernization in 2023. These trends are aimed at improving product quality and user experience.

What Is Legacy Modernization?

Legacy modernization is the process of updating or replacing outdated software and hardware systems to ensure that they remain viable and operate at optimal levels. It is a critical process for businesses that rely on technology to stay competitive in the market.

The banking industry is facing increased competition from fintech startups that offer more innovative and user-friendly services. To keep up with these changes, banks are investing in modernizing their legacy systems. Similarly, the healthcare industry is facing increased pressure to modernize its legacy systems to keep up with the pace of innovation and meet changing patient demands.

There are different methods for legacy modernization. One approach is to migrate legacy technology without disrupting operations. This involves updating mainframes and software apps for a smooth migration. An alternative strategy involves replacing legacy systems entirely by constructing a brand-new system from scratch. Others may choose to custom-configure a new commercial off-the-shelf software solution or transfer technologies, processes, and people from an external source.

Best Legacy System Modernization Trends To Follow In 2023

Legacy modernization is essential because it helps reduce issues by improving the efficiency of your organization while reducing costs related to maintaining outdated infrastructure. Today, it's worth sneak-peeking into the legacy modernization trends as they reflect the rapidly evolving digital landscape, as businesses recognize the need to become more agile, competitive, and secure in the face of tech innovations. In this article, we’ll discuss some important legacy system modernization trends of 2023 including hyper-automation, cloud migration, CI/CD implementation, augmented analytics, A/B testing, DevOps approach, and building AI chatbots. This will help you to create and maintain a competitive advantage by developing a solution and staying ahead of the curve. So, let’s dive in!

Hyper Automation

Hyper Automation helps SMEs to seamlessly integrate a myriad of digital technologies across their business processes and legacy systems. All the stakeholders in an organization get greater access to data and communication as a result.

Without changing the data or access, Hyper Automation offers seamless interaction with your current architecture and old applications. It is the end-to-end automation of processes through a combination of technologies including Robotic Process Automation (RPA), Intelligent Business Process Management Suites (iBPMS), Process Mining, Artificial Intelligence/Machine Learning, Natural Language Processing (NLP), Optical Character Recognition (OCR), and more.

Some examples of hyper-automation are accounts payable, travel and expense management, claims handling, order to cash (O2C), other document processing, sales order management, and cloud communication.

Cloud Migration

Cloud migration is the process of moving an organization's existing legacy systems, applications, and data from on-premises infrastructure to cloud-based platforms. It involves rehosting, re-platforming, or redesigning legacy systems to leverage the benefits of cloud computing, such as scalability, flexibility, cost-efficiency, and enhanced security. The process involves transferring the applications, data, and infrastructure to the cloud platform, ensuring compatibility, security, and performance. Once the migration is complete, ongoing management, monitoring, and optimization of the cloud-based systems are essential to maximize the benefits of the cloud environment.

Cloud migration offers multiple benefits such as speeding up information exchange, preventing security breaches, facilitating data transfer and processing, and improving third-party software integration. Migrating to the cloud can also help reduce costs and improve scalability.

For example, one of the most complex but crucial methods of legacy app modernization is cloud migration. Another example is that businesses are increasingly utilizing public clouds for enhanced revenue creation, profitability, scalability, and disaster recovery.

CI/CD Implementation

CI/CD implementation is a software engineering practice that involves frequent code changes, automated testing, and continuous delivery of code changes to production. It is a legacy system modernization trend of 2023 that is gaining popularity because it helps organizations deliver software more frequently and reliably.

CI/CD stands for Continuous Integration and Continuous Delivery. Continuous integration is the process of routinely integrating code updates from various programmers into a single software project. This helps to detect errors early in the development cycle and ensures that the software is always in a releasable state. Continuous Delivery is the practice of automating the software delivery process so that code changes can be released to production quickly and safely.

Adopting CI/CD can help improve code quality and deliver it to the right environment as small constant code changes are easier to track and execute. Developers can save time and effort by automatically testing modified code without the need for human intervention. One important topic in creating legacy systems is the CI/CD method in automated testing.

Augmented Analytics

In enhanced analytics, Artificial Intelligence (AI) assists or automatically prepares data, analyses it, identifies trends and patterns, and visualizes them for end users. This makes it easier for business users to make better decisions without requiring them to have specialized knowledge in data analytics.

Augmented analytics helps organizations to modernize their legacy systems by automating the data analysis process. It helps organizations to gain insights from their data faster and more accurately than traditional methods.

For example, augmented analytics can be used in the healthcare industry to analyze patient data and identify patterns that can help doctors diagnose diseases more accurately. It can also be used in the retail industry to analyze customer data and identify trends that can help retailers make better decisions about their products.

A/B Testing

A/B testing is a method of comparing two versions of a webpage or app against each other to determine which one performs better. It is used to identify which version of a product or service is more effective in terms of user engagement, conversion rates, and other metrics. (Source) A/B testing is a legacy system modernization trend of 2023 because it helps organizations to modernize their legacy systems by testing new features before integrating them into the software.

For example, a company may want to test two different versions of its website to see which one generates more leads. They can use A/B testing to show one version of the website to one group of users and another version to another group of users. The company can then compare the results to see which version performed better.

DevOps Approach

DevOps combines development and operations teams to deliver products faster and better. Collaboration, automation, and continuous integration and delivery are key aspects of DevOps. It entails a cultural shift that breaks down silos and bottlenecks, emphasizing cross-team communication, collaboration, and technology automation. DevOps encompasses a set of practices, tools, and cultural philosophies that streamline processes between software development and IT teams.

Looking ahead to 2023, enterprise DevOps is expected to mature and expand its business impact, with a strong focus on quality, improved time-to-market, customer satisfaction, and productivity. Another notable trend in legacy system modernization is the adoption of the DevOps approach, which integrates software development and operations. This approach involves close collaboration between operations and development teams throughout the product lifecycle, ultimately enhancing product quality and user experience.

For example, the popular online marketplace Etsy migrated on-premise servers to Google Cloud in 2018 to support the growing number of sellers on its platform.

Building AI Chatbots

Building AI chatbots has become a top legacy modernization trend in recent years. Despite they are challenging to create, they have major benefits. According to Forbes, companies using AI chatbots increased sales by 67% on average. (Source) By 2023, market analysts expect chatbots to be integral to every industry as consumers continue to expect 24/7 customer service. Unlike simple chatbots, these modern chatbots are expected to use natural language processing and mimic human conversations.

In early February 2023, Microsoft unveiled a new AI-improved Bing, which runs on GPT-4, the newest version of OpenAI’s language model systems which is more capable and reliable. Bing’s chatbot is currently in a limited preview while Microsoft tests it with the public. (Source)

Signs Indicating the Need for Legacy System Modernization

Today, outdated legacy systems can pose significant threats to business growth, potentially resulting in failures, performance issues, and diminished value. To ensure your applications deliver business value, possess modern functionality, and meet expectations, it's crucial to recognize the signs that signal the need for legacy system transformation. Here are key signs that your legacy system requires a revamp:

Liabilities Caused by Product End-of-Life

Using end-of-life solutions can heighten the risk of hacking attacks and data breaches. To avoid such vulnerabilities, businesses should review the current state, explore replacement options, and determine which components to replace first when manufacturers announce product discontinuation.

Excessive Hardware Dependency

On-premise servers have high administrative expenses and ownership costs. Embracing the cloud eliminates the need for physical servers, allowing businesses to run applications with ease and rely on cloud providers for system updates and minimal downtime.

Frequent System Crashes

Outdated legacy software often experiences constant lags, glitches, and crashes, hindering operational efficiency. Integration of software quality management and testing processes can help modernize legacy systems, improve performance, and leverage server optimization techniques.

Device Dependencies

Mobile devices have become integral to our lives, with mobile traffic accounting for a significant market share. If your software primarily caters to desktops and fails to adapt to mobile platforms, your business may lag behind competitors in terms of profits and performance. Mobilizing legacy software and resolving integration issues can augment functionality and enhance competitiveness.

Higher Maintenance Costs

Legacy systems lack centralized data processing modules, leading to substantial expenses for database upgrades. Maintenance costs, including tech debt, frequent downtimes, special licensing, and hidden expenses, can strain resources and impede progress on mission-oriented projects.

Incompatibility with Modern Systems

Ensuring compatibility between software systems is crucial for seamless business operations. Failing to integrate new tools or operate with outdated systems may result in customer loss, jeopardizing the existence of your business.

Non-Compliance with Current Regulations

Legacy systems often fall short of meeting current regulatory frameworks, increasing the risk of legal consequences, penalties, and damage to reputation. Protecting sensitive data within data-heavy solutions incurs additional expenses to mitigate external and internal risks.

Recognizing these signs can help your business identify the urgency of legacy system modernization, enabling you to address vulnerabilities, enhance performance, and maintain compliance in an increasingly digital landscape. Stay ahead of the curve and secure your business's future by embracing modernization.

Make your legacy system future-proof with Vikasietum

Modernizing legacy applications not only guarantees improved revenue but also mitigates concerns regarding security regulations and business requirements, even if the customized replacement falls short in some areas. While the initial costs of updating legacy applications may seem daunting, an incremental approach, coupled with the right modernization strategy and tools, can effectively address this challenge.

At Vikasietum, we are dedicated to helping you analyze and implement a modernization initiative for your legacy systems that align seamlessly with your business goals. Our renowned application modernization services are backed by a team of collaborative experts with extensive industry experience and specialized technical skills.

By leveraging our expertise, you can integrate an ideal legacy modernization strategy into your business, ensuring long-term success. Connect with us today to integrate an ideal legacy modernization strategy into your business.


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