3 things to keep in mind when updating legacy tech applications

Stuart McLeod

People are resistant to change — and that goes double for most enterprises. But change is also the only constant. And in today’s hyper-competitive business world, keeping your systems up-to-date is a necessary ingredient for growth and innovation.

The truth is, the technology your company relied on just a few years ago might not be the best solution for your needs today. Legacy applications — including software that’s become outdated either because of a lack of continued vendor support, an incapacity to meet the organization’s needs, or incompatibility with new systems — can really hold your organization back. These legacy systems are usually pretty high-maintenance and often involve complex patching and alterations.

But updating these applications is always much easier said than done — many company leaders often don’t understand how much work is involved, or what the particular challenges will be.

First of all, a massive tech overhaul usually comes with a hefty price tag. And because your team is used to the status quo, it can also be a highly disruptive process. In fact, according to a recent MIT study, 62% of respondents said integrating legacy systems was their biggest challenge in deploying multi-cloud infrastructure.

While there are always challenges in updating your organization’s legacy technology, doing so will lead to greater efficiency and cost savings down the line.

Here’s what you need to know before making a major software switch:

1. Get your team on board early.

One of the top challenges in updating legacy applications is user acceptance.

When your team is used to doing things a certain way, a massive upheaval isn’t likely to be taken lightly. Legacy users are typically settled with their systems, including creating their own shortcuts and processes in or around the system. This means before you update, you need to plan considerably for the change and ensure that the reason for it is well communicated to your team and clients alike. Legacy applications have all kinds of tentacles that aren’t anticipated in the upgrade process.

If you can forecast the areas of complexity and difficulty and overcome them early on, the likelihood of success improves dramatically.

To do this, acceptance testing is a must. Also known as beta testing, the main purpose of this testing is to validate the software against prevailing business requirements. It’s typically the last step before the product goes live or before the delivery of the product is accepted, and it’s performed after the product itself is thoroughly tested.

Without clearly communicating the change, beta testing, and getting everyone on board, you’re not going to get the efficiencies or productivity gains that you set out to achieve in the first place.

2. Foster a progressive company culture.

Legacy change comes from the top, but that doesn’t mean there won’t be some pushback from your team.

Think about the enormous rise of Box and Dropbox.

Over the past 5–10 years, Dropbox has popularized the land-and-expand model, completely replacing its legacy application, SharePoint. And this was despite CEOs stuck in their ways demanding, “We’re going to use SharePoint and that’s that.” The younger generation of workers was more comfortable with Dropbox, so a mandate to stick to the legacy tech just didn’t fly. Ultimately, employees were just doing what worked best for them — and that’s how DropBox took over.

Updating legacy applications is never easy. But it’s easier when you have a progressive, forward-thinking company culture. As a leader, you want to make things easier for everyone by updating your legacy tech and allowing them to perform tasks the way they’re most comfortable.

If you’re open-minded and agile, everyone will be better able to weather the rapid changes in tech.

3. ROI is real, but it can mean different things.

There’s no point in updating your tech if the ROI is questionable.

And history is littered with legacy upgrades gone horrifically wrong. For example, when British telecom provider Vodafone consolidated its CRM systems onto a Siebel platform, not all the customer accounts migrated properly. The upshot: a multi-million dollar fine from the British telecom regulator.

In fact, 21% of companies in a recent study characterized their most recent attempt to update legacy tech as an outright failure.

But if you’re not extracting either the top line or the bottom line benefit, then you have to seriously consider the project. But how do you measure it? There are a number of intangibles you have to consider, such as: Are you achieving cultural progression by embracing a newer product, or will it be more of the same?

The ROI is a multifaceted measurement, and obviously, the bean counters are going to want to see a solid return. But at the end of the day, using better, nicer, and easier software has a positive cultural impact when it replaces legacy applications.

I remember making the switch from Desktop SAP over to Oracle, which was online. I saw firsthand just how big an impact this kind of change can have on an organization.

Your aging digital tools may work, but they may not be as efficient as newer ones and they may impede you from moving forward in your business. Updating legacy systems can be a cumbersome process with a lot of moving parts, but if you’re smart about it and take the necessary precautions, you won’t look back.

Stuart McLeod

CEO & Co-Founder, Karbon

Stuart started his first business 11 years ago and has had many successful ventures, including Paycycle, founded in 2009, which he sold to Xero in 2011. He then built the global Xero Payroll team that delivers payroll software across the US, AU, UK and NZ markets. Stuart is now paving the way for smarter tools to improve how knowledge workers collaborate with their colleagues and look after their clients.


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