Technology

3 Reasons To Update Your Business Legacy Software

If you’re still on the fence on whether you should update your legacy system, here’s a deep dive into why replacing legacy systems simply makes sense.

Gone are the days when you’d have an IT guy come in and install your business’ legacy system. Today, cloud computing and data integration make it possible for businesses to streamline their operations, save time, and ultimately save money. Despite the facts, many businesses are still running on outdated legacy systems without any real plans for a replacement. 

If you’re still on the fence on whether you should update your legacy system, here’s a deep dive into why replacing legacy systems simply makes sense. 

Legacy Systems Stall Your Business Growth

It isn’t news that businesses have a constant need to keep up with rapidly changing technology to stay competitive in their industry and cater to their customer’s needs. 

Regardless of whether you’re an SMB or an enterprise, businesses need unified data to be able to make decisions, allocate resources, increase customer acquisitions, and drive growth. Unfortunately, a legacy system stalls your business’ ability to deliver in these areas because it often doesn’t connect data points necessary to run effective workflows.

This is probably why it isn’t surprising that once businesses make the change and leave their outdated applications behind, it’s been proven to lower costs by more than 14% while significantly increasing revenue. 

Unfortunately, a legacy system lacks the infrastructure necessary for the effective flow and collection of data. In fact, 76% of respondents in a legacy system survey claimed to have a part of their data trapped by outdated legacy systems that can’t integrate with cloud-based software. 

In a case study by Audacia, once AESSEAL, one of the largest mechanical seal manufacturers, decided to invest in new technology and leave their outdated legacy applications behind, they saw a surge in significant business growth. This included drastically improving its user experience, increasing its invoice speed, and adding to their $170 million in annual sales. 

The information is clear, discarding your legacy system for an updated system might be a painstaking process in the short-run, but the returns are overwhelmingly net positive overall. 

It Creates Hidden Costs

Though you can still use a legacy system today, it’s estimated that businesses are losing $140 billion annually due to disconnected data running on outdated systems. Unlike old technology, newer technology tends to be easier to maintain and update, largely because a lot of it is cloud-based SaaS. In short, it solves the data issue, regardless of any updates you’ll need to make in the future, or if your company needs to scale.  

Yet another hidden cost of legacy systems? Maintenance bills. Specifically, 60- 80% of the average company’s budget is spent on maintaining legacy applications that can only be maintained with band-aid fixes at best. The maintenance of legacy systems is time consuming and can often need a costly amount of downtime to be worked on. 

To add, legacy systems come with an unfortunate slew of negative side effects that aren’t all that obvious at first glance. Employees run into technical issues that slow them down while trying to get their work done, customer service quality suffers, you run into compliance issues, IT bills start piling up and you suddenly find yourself in a culture of inflexibility within your company. 

Legacy Systems Put Your Data At Risk 

One of the costliest disasters a business can survive through is a data breach. With an outdated legacy system, your sensitive business information is left vulnerable to attacks that, on average, can cost you well over $3 million in damages. 

Taking the necessary steps to onboard an updated system that allows for greater flexibility and data encryption that protects both your employees and your customers can take you further than a contingency plan for your existing system ever could. 

However, it doesn’t stop there. Since legacy systems are so outdated, some of the knowledge that was once necessary isn’t exactly abundant or in-demand now, which can make it difficult to find someone qualified to work with your old system and keep it running until it turns completely obsolete. 

In Summary

While your business legacy system can be difficult to replace, it isn’t impossible to do. As the world continues to innovate, the last thing your business needs is to be left behind or worse, die a slow death because of systems that will eventually not support your daily operations. 

Fixing this costly issue starts with the awareness of how much not updating your legacy system can cost you in more ways than one. 

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