Risks of Not Modernizing Platforms

Many companies get started with using legacy systems. Over time, these incumbent systems still work, but they underperform in significant ways. When decision makers have to choose where and how to modernize, questions and risks naturally find their way into the conversation.

Platform modernization is the path businesses can use to instill innovation, produce enhanced customer experiences, and even navigate challenging business decisions.

In this post, we’ll define what platform modernization is, discuss the challenges associated with legacy system modernization, and shed light on the risks that organizations take on when they fail to modernize.

What is Platform Modernization?

Platform modernization is the process of updating legacy applications to the newest and most innovative software tools and paradigms. The entire modernization process typically involves:

• Discovery (surveying where things are currently)
• Strategy (planning for the future)
• Implementation (strategically updating applications and platforms based on priority)
• Custom development (addressing customer’s top priorities)

Keeping in line with a product mindset, modernization teams must understand the overarching business goals before getting to work. This context is critical for building modern products that will deliver the right business values and solve for need.

Modernization can help organizations stay in line with or ahead of the competition and offer a more consistent and engaging customer experience.

Legacy Modernization Challenges

Business leaders and decision-makers often have major fears about platform modernization, but letting these worries guide modernization decisions can make growth harder both now and in the future. Some of the most pressing worries around modernization include:

• Having access to skilled craftspeople. It takes highly skilled craftspeople to make transformational updates to legacy platforms. Business leaders might need to bring new, skilled team members on board.
• Internal and external resources. An appropriate and realistic distribution of resources must take place before legacy updates can be made.
• Time constraints. Many businesses don’t think they have the time to modernize legacy platforms, particularly in stages of high business growth. Unfortunately, this can be a mistaken belief that leads to lack of growth and scalability in the future.
• Other (competing) business priorities. Additional goals and basic daily operations take precedence over making big changes. Leaders must communicate the value and priority of legacy modernization.
• Compliance requirements. Newer, modern technology may come with specific security protocols and compliance mandates. In many cases, a more updated technology helps to fulfill compliance requirements more adequately.

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What Risks are There Without a Legacy Modernization Strategy?

When discussing legacy and platform modernization, the old adage is true—failing to plan is planning to fail. Don’t fall into the trap of exchanging present ease and comfort for a future of stunted growth and lackluster performance.

There are major risks associated with failing to update your platforms and applications, some of which are discussed in detail below.

Risk 1 – Risk of losing customers

Customers and users know and are able to recognize a great customer experience. Improving UI and UX through platform modernization is a way to keep customers and reduce churn. A modern, user-centric application or platform will bring results like improved retention, increased brand loyalty, and optimized engagement.

Since many people are now accustomed to Amazon-like experiences—including those that make it easy to browse and buy—it’s critical that corporate modernization rises to meet those expectations and perceptions.

Risk 2 – Dealing with a technical deficit

Having “technical debt” makes it more difficult to innovate and keep up with increasing demands. Moreover, this technical debt keeps growing over time, and, as time goes on, it becomes harder for organizations to pay up.

Technical deficit can also be a consequence of “poorly written code” or platforms that are notoriously under-performing. Occasionally, teams fall into the trap of being reluctant to fix a problem that has always existed or is deeply embedded into the corporate culture. This, however, is not an excuse to do nothing in the way of modernizing platforms.

Risk 3 – Exposure to cybersecurity threats

Outdated platforms don’t offer the latest cybersecurity protections—period. Cybersecurity risk exposes major system flaws and increases virtual vulnerabilities.

A cybersecurity issue can encompass everything, including core internal systems and customer-facing applications. Recent impacts of this risk are on the rise in the form of costly data breaches and ransomware attacks.

Other, less measurable—although equally severe—impacts include damage to a brand’s reputation and public-facing persona. This can take place as a result of ruptured trust or due to the fact that a brand has received public sanctions.

Risk 4 – High maintenance costs over the long run

The longer you keep a platform that doesn’t keep up with current industry standards, the more expensive it will be to maintain it. A higher cost is associated with factors such as higher licensing costs and a more specialized skill set that can make hiring processes much longer.

Costly infrastructure can eat into revenue and profits, and undifferentiated heavy lifting can significantly affect IT-related financials.

Start the Legacy Modernization Process

If you’re ready to tackle your organization’s platform modernization strategy, contact 3Pillar Global today. Our team of experts is committed to making your platform modernization journey effective for your particular business model and goals.