Today, many organizations are dealing with the challenges of maintaining their legacy applications. As the technology landscape evolves, business users’ demands of their application systems continues to grow and the options in the marketplace have changed dramatically.
The pace of business is continually increasing and the immediate requirement for information by businesses and customers alike creates demands on a company’s information systems. This demand is particularly challenging for IT departments to satisfy. Continued investment in older applications that should be retired, rather than creating new ones that would better enable the business, sets up a situation called the “Legacy Trap”.
This article outlines the problems and strategic solutions for this “Legacy Trap”.
The Problem
Recent industry reports indicate that organizations spend, on average, 80% of their IT budget in three areas:
- Operating and maintaining outdated systems;
- Systems that they want to retire; and
- Critical systems that have become enormously expensive to support.
These reports suggest that the cost of software maintenance is indeed a major challenge for CIOs.
Organizations that struggle with legacy applications typically think about them in terms of a continuum. On one end of the continuum are those companies that are concerned about such basic things including: where the source code exists or how it really works. On the other end of the continuum, there are companies that wish to enhance the functionality of the application but are plagued because of the complexity of the system.
The cost of maintenance is typically the result of a combination of parameters, the key ones being:
Aging technology
Many organizations have systems operating in technologies that are not well supported or may no longer be useful. As applications age, they become increasingly expensive to support. As such, the cost of corrective, adaptive maintenance can be quite significant.
Knowledge attrition
What happens when an organization experiences a turnover in IT staff?
Legacy systems often require specific IT skills, mostly in older or obsolete programming languages. Typically, many legacy solutions incorporate extensive and unique customization. Often the IT staff who have managed these customizations are the only people who understand the complexity of the system at any great depth. In addition, most attempts of software documentation fail and “reverse engineering” becomes the only (but expensive) way to keep systems on a life-line.
Opportunity costs
Many legacy systems are not designed to evolve with time. For the most part, the cost of upgrading and maintaining these legacy systems puts a strain on IT personnel, who are burdened by the time and effort of keeping the system going rather than focusing on building new, more efficient applications.
Solutions
Trying to keep legacy solutions at optimal cost depends on where those solutions sit on the “legacy application continuum”. Organizations may find that mission criticality and other elements are strong deciding factors in their decision process. Overall practical strategies can be summarized through the following categories: Retain, Repair, Replace, Relegate.
Retain
Retain, also known as a ‘wait-and-see’ strategy, is a viable solution for systems that have been stable but fit into a non-strategic quadrant. These systems will eventually be retired by new installations. System retention can be outsourced to a third-party vendor or kept in-house.
Repair
Active upgrades of existing systems is a science. From code portage, to wrapper techniques, conversion projects are good ways to control maintenance costs through an evergreen and modernization program. A renovated system is typically less expensive to maintain (as technical debt and aging technologies are no longer issues). In a software system, repair is synonymous to conversion, which makes the process very mechanical in nature, and readily delegated.
Replace
Some IT systems are not good candidates for a Retain or Repair strategy. A replacement project is sometimes more economical, but can be a lengthy process. During its replacement, the legacy system must be placed under maintenance to give time to project teams to recreate the solution. A replacement project requires careful planning and must include transition plans from one system to the other.
Relegate
An organization can manage its own legacy systems or outsource its maintenance and operations to others. A key benefit of this latter strategy is that while the system is being outsourced, the organization can work on future or additional innovations. Outsourcing may include application maintenance and operations. In the past few years this strategy has also enabled organizations to accelerate their transition to private clouds and removed the headache of IT operations all together.
The Litcom Approach
Litcom offers an Application Custody Service that enables IT leaders to deal with their legacy challenges. Specifically, the service provides a range of solutions that let companies transfer their legacy applications and/or the operations. This service allows them to eliminate the unnecessary operating costs by reducing capital spending and allowing them to focus on new strategic and revenue-generating initiatives. We help address critical questions, such as whether to migrate, re-platform or remediate legacy applications. Our goal is to help you add value from existing applications while reducing costs, limiting disruptions and decreasing risk. To learn more about our application system review service please contact us at: info@litcom.ca