Application modernization services enable an organization to adapt to the changing technological environments, thus keeping the business wheel turning. In other words, Application Modernization Service is about an upgrade from a legacy system to a newer platform. In the past, business firms viewed technology management as a distinct function associated with technocrats with few forward and backward links to the business. To varying degrees, technology has played a large role in automating production processes, mainly in the manufacturing sector. Factory automation has been all about fixed capital investments in plants, equipment, tools and machines. Very often this mechanization was integrated into an assembly line production system, an idea of the Ford Motor Corporation. This enabled companies to keep production flowing, proactively plan inventory and take advantage of economies of scale. However, problems were observed every time these bugs were discovered in the products. But the heavy use of legacy systems meant the damage was already done, leaving no room for any installation options. In addition, manufacturers’ legacy systems presented another problem, namely that of system upgrades when required. Legacy systems meant there were no opportunities to tweak the production system through junkyard innovation if needed. Very often companies have had to continue with the ancient ailing systems and thus suffer losses or polish the entire system by bringing the production process to a standstill. Both options resulted in wasted resources, high opportunity costs in terms of lost business due to disruptions and delays.
In the modern era, automation has penetrated even deeper into the business world. It not only includes the production processes mentioned above, but also includes business processes. Therefore, in the technologically advanced state of the art, companies need to manage the automation of business processes rather than the automation of production processes. Digitizing a company’s back-end and front-end capabilities requires brainstorming on issues very similar to those of years past. We take a look at some of the challenges that can arise when modernizing software applications and take a look at how legacy systems can be managed effectively.
Short-sighted vision of top management when rejecting the need for modernization
In the world of software, innovations rarely die. In fact, there is always a steady stream of innovation that keeps flowing either in the form of new versions of operating systems, languages, or handheld devices. However, an innovation only sells if it brings significant added value. In this context, the natural instinct of a top management executive responsible for change management is to stick to the proven formula and maintain the legacy application systems. If new alternatives and upgrades don’t add real value to the business, it also becomes difficult to sell the idea of a modernization requirement to anyone and everyone. In some cases, companies also question the need to modernize or port from an existing system to a new one, citing reasons for sustained levels of productivity and organizational learning required to adapt. The risk of averting the risk of application modernization is that the big picture very slowly imposes itself almost in a competitive impasse. By the time companies feel the need to let go of the old and embrace the new, the new has already become a trend that robs the company of the first-mover advantage. From now on it’s all about keeping up with the competition, more likely to be in the race, but the chances of winning are close to zero. The advice here is simple. If an application ever needs to be modernized, it should be done right the first time to gain a competitive advantage.
High lock-in costs and return on investment of legacy systems
The second major challenge companies face is the high lock-in costs and return on investment that legacy systems create. While the first challenge is heavily opinion-driven, the latter is data-driven. Software vendors build high fixed cost elements into applications in their bid to retain accounts, making a renewal mission a costly affair. In addition, application maintenance services and troubleshooting help keep a company loyal to an existing provider. Additionally, companies tend to keep legacy systems in their offerings to maximize return on investment. While these are important economic considerations, such grooming apps have inherent dangers. First, as companies with legacy apps keep up the investment push, coding and migrating to new apps becomes even more cumbersome. Second, shying away from an app modernization for a long time can end up completely damaging the business process if it has to be. App modernization allows an organization to be prepared for a continuous stream of upgrades as they are released, with minimal programming and capital investment.
Summary: Application modernization services represent a vicious circle for an organization. While there is always a temptation to maximize ROI by continuing with legacy applications, there are significant costs associated with doing so. The longer the delay in modernizing an app, the greater the costs that will be incurred when it finally has to be finished. Additionally, executives who are authorized to take a call for technology issues must be proactive enough to understand the need to engage the application modernization service at the right time so that future upgrades can be made with minimal programming effort and cost.
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