Technology
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While technology advancements are moving fast, some businesses seem to freeze in time. Many enterprises, businesses, and even government agencies still rely on outdated software. Each day, they are more difficult to scale, process data, and deliver even a moderate user experience.
The problem is here, and it is global. Sounds like your organization, but you don’t know what to do? Here is the answer: launch legacy system modernization.
A legacy system is a software, technology, or process that is built on outdated technology and has low performance, security issues, high maintenance costs, and scalability and adaptability issues. As we are focusing on software today, it is, in other words, an outdated business app.
In contrast, if you want to succeed, you need an efficient, powerful, and reliable software system to gain a competitive advantage and be flexible to changes.
So, when should you modernize? When you see that your system no longer satisfies your business needs, e.g., is unreliable, prone to crashes, has inefficient workflows or a high total cost of ownership, it's about time to consider legacy app modernization.
Legacy systems are usually poorly documented, process data slowly, have outdated interfaces, and are not optimized for mobile devices. Check your system's tech stack to get a better picture of its state. If it is built on legacy technologies like COBOL, Visual Basic, Delphi, Object Pascal, or Fortran, it's also a sign that it’s time to consider legacy system modernization strategies.
Other reasons to consider app modernization:
According to Statista, the main reasons for legacy software modernization in 2023 were striving for more security, efficiency, and cost reduction. But there is so much more that modernization can bring.
While users can feel nostalgic about Windows XP, running their businesses on old-school technologies leads to missed opportunities. Obsolete software limits users' ability to enjoy a cloud-first approach and apply modern architecture, AI and ML capabilities, robust integrations, and reporting and analytics tools.
A picture is worth a thousand words, so let's see how the whole thing works through NEKLO's legacy system modernization case study.
The client with the outdated data migration application wanted to introduce new features to it, refactor the backend code, and transition it from Node.js to .NET. Additionally, they wanted to re-platform the solution from desktop to web to make data migration tools available for more customers.
The client's app, built on legacy technology, could not properly scale, lacked migration features, and had performance issues. The app's complex interface prevented users from its effortless use, and there was a risk of data loss during migration.
The major issues the client faced:
NEKLO started by evaluating the platform and came up with a strategy for innovation. The team created a new solution using the initial version as a sample, rewrote it with new technologies and updated architecture, and added robust features and tools. We implemented changes on technical, functional, and visual levels.
Our team created a new version of the data migration tool, making the following changes:
The modernized data migration platform is currently receiving its first clients. NEKLO's dedicated team continues to work on improving functionality and developing new features.
There are several software modernization strategies. Each is applied individually through system evaluation and available resources. We'll divide and compare all modernization strategies by the effort required and the positive impact expected. Additionally, we'll indicate the conditions when using each one is the best way to level up. Let's see what we get.
Encapsulation strategy means creating APIs or interfaces around legacy systems, allowing them to communicate with other apps. It creates a secure shell, where the internal system remains isolated from external influence, and employees or clients enjoy a user-friendly interface on the other side.
For businesses, encapsulation carries low risks, requires little time and effort, and is easy and cost-effective (you can save money on staff training). This legacy software modernization strategy implies establishing strict access controls and protecting data from unauthorized modifications.
As the most basic modernization strategy, it keeps your legacy code untouched, allowing for better system integration and data exchange. In the long run, such a system may become resource-intensive, and you may be vendor-dependent.
Verdict: It is good for apps with high business value and quality code, but it does not solve core problems.
Legacy app federation is sometimes also considered a modernization method, though not a classic one. The essence of this strategy is to make several legacy apps work together with the help of middleware, APIs, or integration platforms, providing seamless data access and flow between them. A unified framework streamlines operations, allows for staged modernization and for adding new modules without disrupting existing infrastructure.
This strategy is cost-effective, low-risk, and comparatively easy to implement. But there is another side to the coin: the challenges connected with interoperability and data consistency, resource-intensive scalability, and potential performance bottlenecks. We’ll discuss them below.
Verdict: Legacy systems federation is a good fit for businesses aiming to retain core legacy functionality and introduce incremental modernization, leaving performance and flexibility issues unresolved.
This strategy implies moving infrastructure to another platform, often from on-premise to cloud storage or newer hardware, without changing legacy code. This approach lowers maintenance costs and improves performance. It requires little investment (compared to full rebuilding) and is often seen as the first step to further system improvement.
This legacy system modernisation strategy is low-risk, fast, and easy to implement. Nevertheless, it does neither influence business logic, nor allows using cloud-native features, addressing architecture inefficiency, or improving scalability.
Verdict: Rehosting is a balanced and cost-effective approach for businesses that want to improve their legacy systems quickly without a big initial investment. It works for relatively outdated software but does not change legacy code, so many issues remain unaddressed.
Refactoring means updating an app's architecture and structure without external modification. It is a great opportunity to revise business processes and solve inconsistent code issues. The strategy allows for better performance and scalability and makes it easier to introduce new features and integrations. It does not add any new features or change the existing system's functionality.
This strategy is moderately risky and expensive compared to complete system rebuilding. The main risks include improvement limitations caused by existing design, complex management, and long implementation times.
Verdict: The strategy suits businesses that need to integrate the legacy system with newer technologies or systems but do not need complete app rebuilding. It allows the system to remain operational without significant downtime.
Like rehosting, this strategy also includes moving from the old platform to the new one, for example, migrating applications from web to a cloud-based environment, or Magento to Shopify migration in eCommerce. The difference is that re-platforming involves code adjustments to the selected platform, allowing the use of basic cloud functionality. Adapting current solutions to new environments results in improved scalability and performance, better security and compliance, and enhanced integrations.
This legacy software modernization method is easy to apply, carries low risks, and shows good results. Nevertheless, replatforming doesn't address technical debt and has limited impact on performance or security — the app may become even more complex and difficult to maintain.
Verdict: This approach suits systems of low complexity that don't need a full redesign. It's great for businesses with limited budgets, aiming at minimal disruption and faster migration compared to full redesigning.
Re-architecting means redesigning the overall system architecture to align with modern technologies, practices, or business requirements. It leads to significant performance and scalability improvements, fixes architectural bottlenecks and limitations, and introduces new app features. Re-architecting methods include moving from monolith architecture to microservices, migrating to new databases, and rebuilding critical components with new designs.
Re-architecting has medium costs and risks but remains challenging due to data migration, the complexity of breaking down a monolithic application, and vulnerabilities during migration or redesign.
Verdict: This strategy suits businesses whose legacy systems' current architecture cannot support business needs or modern technology standards. It is resource-intensive and time-consuming.
Rebuilding means rewriting legacy app components from scratch with new technologies, adding new features, and improving performance. It is one of the most effective strategies, allowing you to rebuild the whole legacy app or only its core components, services, and functionalities and make them cloud-native. Designed to meet future demands, rebuilding is a custom future-proof solution that enhances efficiency and security.
The tricky part is that implementing this legacy system transformation strategy requires budget and effort. Your development team needs to analyze the business logic of the legacy app. It can be challenging, as old systems are usually ill-documented and complex. Additionally, the developers must ensure no connectivity disruptions with other systems (which may also be legacy).
While offering great flexibility and room for innovation, this strategy carries high costs and risks, such as gaps in the planning stage that can lead to a lack of functionality.
Verdict: This solution suits businesses that require quick modernization implementation with minimum downtime. It is also good for companies with a large client base, where they cannot confuse their customers by rolling out a completely new solution.
When you see that your legacy software cannot be significantly improved by all the abovementioned strategies, the solution is to implement a new one. This approach requires a lot of investment but allows you to reap most of the benefits. You get a modern, feature-rich system tailored to your business needs that seamlessly integrates with other solutions.
Aside from being resource-intensive, this approach carries the greatest risk of budget overruns, extended timelines, and potential failure to meet the original system's functional parity. It may also lead to significant downtime and staff resistance to changes.
Verdict: Full replacement suits businesses whose legacy system challenges are hard to overcome without removing the whole system and companies with enough resources for new system development. A detailed feasibility and impact analysis can help you decide whether this strategy is right for you.
The hybrid strategy encompasses all the abovementioned approaches (except for replacement) to legacy system modernization. You can combine them for better results, including efficiency, performance, and improved workflows. Hybrid strategy provides different levels of system changes that suit a project's specific needs and constraints. It leads to a balanced and efficient modernization process, allowing gradual and continuous improvement implementation without major disruptions.
There are two main legacy system modernization approaches: big bang and phased.
The big bang approach means completely replacing your legacy system with a fresh solution right after launch.It is quicker and carries lower long-term costs. However, it is also risky, resource-intensive, requires thorough staff training beforehand, and can cause disruptions in business operations.
A phased approach means gradually replacing the components of an old system, part by part. This approach is flexible, carries lower risks, and allows for seamless staff training. However, it requires more time to implement and has higher transition costs. Nevertheless, a phased rollout suits businesses where downtime or disruptions in business processes can cause significant losses.
We can classify all legacy app modernization strategies into less invasive or more invasive. For example, encapsulation is a less invasive approach than refactoring, as it does not impact legacy code or app architecture. To select the right strategy, you must evaluate your current system from different perspectives:
Afterward, list the expected results you want to achieve from modernization, consider the project's time, cost, and risks attached to every strategy. Clarify your business objectives and the impact that the modernization process and its result can bring. Answer the questions:
When you get the whole picture of your current project state, choosing the right approach towards modernization will be easier.
Additionally, we have collected a list of tips for choosing the best modernization strategy for your legacy app.
According to the study, organizations worldwide spent $2.7 million in the 2024 financial year overhauling legacy systems, highlighting their importance for business globally. Are you ready to join innovation? We have outlined 5 actionable steps to start a successful legacy modernization project.
Assessing your legacy system means listing the issues, concerns, and impediments it brings and a much more comprehensive process. You can start with the main factors to consider.
Business factors include business fit, agility, and value. Evaluate how the current system meets business needs, define where it lags behind, and consider what actions can be taken to overcome current difficulties.
Technology factors include risk, cost, and complexity. They are directly related to the legacy app's security level and the total cost of ownership, maintenance, and support. If the costs and risks are high, it's time to modernize. Prioritize improvement areas and evaluate available resources.
When opting for legacy app modernization, you need to know what you want to achieve. Consult experts and stakeholders on the system's desired features and functionality, technical feasibility of the expected outcomes, and risks. That’s how you can do it:
At this step, you decide how exactly you want to improve your legacy system, choosing a modernization strategy and implementation approach. Now that you know the strengths and limitations of current applications, you need to decide how to get the highest value from the modernization process.
All legacy app improvement strategies are based on indicators like cost, risk, and level of change. Estimate each strategy's complexity, risk, timeframe, and resources you need for its implementation.
Look for agencies with expertise in legacy systems modernization in the same domain your company operates. In your search, you can rely on established B2B platforms, ratings, reviews, testimonials, and even word of mouth — ask your colleagues for advice on software development companies.
When hiring providers of legacy app modernization services, assess their portfolio, the way they communicate, how quickly they answer your questions, and what project management and communication tools they use. Ask about their turnover rate to ensure your team will not suffer from constant changes, and ensure clear terms regarding deliverables, timelines, and ownership of the final system.
Consider hiring a dedicated team from Eastern Europe. This region is famous for its developers' professionalism, compiled with reasonable pricing.
Need a reliable partner with deep expertise in legacy system transformation? Contact NEKLO to learn more about how we innovate legacy apps to bring value to the business.
Depending on the chosen modernization strategy, you may require a staff training program. The more changes in the app's interface and functionality the upgrade brings, the more likely your employees will resist such changes. Address this resistance constructively by emphasizing how modernized software can facilitate daily tasks and make workflows more efficient.
Best practices for staff training include assessing training needs, staff segmentation and personalized training, employee feedback, and evaluation. Diversify learning by offering different methods, such as lectures, online learning, collaborative training, videos, instructor-led training, etc. Prepare a staff training program in advance to avoid implementation challenges later.
As you can see, legacy software modernization is not that simple. There are several potential pitfalls. It's good to be aware, but an experienced legacy app modernization service provider can overcome them all.
The good news is that careful selection of service providers decreases your chances of meeting such impediments to almost zero. Look for the one with industry expertise, experience with legacy systems, and deep knowledge of relevant tools, technologies, and best practices.
Legacy system modernization requires a tailored approach that considers its complexity, features, data quality, resources, and desired outcomes. Based on that, your software development team decides on a strategy for replacing the legacy system completely, implementing a tech stack, integrating, etc.
You should opt for it if your current system is slow, lacking new features and integrations, hard and costly to maintain, and has security and scalability issues. Along this modernization journey, you need a reliable development team experienced in legacy systems.
NEKLO can provide you with just the right one. Contact us for a deeper discussion of your outdated system and related concerns. Get free, non-binding estimates today.
US-based and operating globally, NEKLO spearheads digital transformation initiatives for businesses worldwide. We deliver software solutions complying with your market and legislation.
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