Digital technologies such as cloud, mobile, and Big Data are creating new opportunities for organizations worldwide. These technologies transform businesses by improving efficiency and productivity, reducing costs and elevating customer experiences. The need to stand out against the competition in this digital era has resulted in the growth of application modernization solutions – driving digital transformation.
Companies of all sizes are investing heavily in legacy modernization and other strategic digital solutions to mold their applications into newer, performance-oriented solutions thus enhancing customer experiences, increasing brand engagement and improving bottom-line results.
IDC estimates that worldwide spending on Digital Transformation technologies will reach$1.3 Trillion. Also, the IDC Global Application Modernization Services Market size is expected to reach 7.7 billion by 2023. The industries that will invest the most in digital transformation are discrete manufacturing ($214 billion), professional services ($133 billion), process manufacturing ($132 billion) and transportation ($127 billion).
What is Application Modernization
Legacy applications are typically incompatible with today’s new and continuously evolving technologies such as cloud and mobility. Furthermore, many skilled workers are retiring in the next 5 years that support these legacy systems. Both these scenarios can limit an organization’s ability to achieve digital transformation and one way to remove this roadblock is through modernization.
Legacy application modernization refers to the process of aligning legacy software application stacks with the current business needs and functionality requirements by utilizing new technologies. The reasons for organizations to embark on an application modernization journey are plenty, however, the most common driving factors are cost reduction, productivity enhancement, and skills shortage.
Considerations for Modernization
Most organizations continue to run on aging systems and legacy applications. The application modernization process can prove to be a daunting task without adopting business goals, strategies, and best approaches.
The most critical first step is to evaluate your current application portfolio: the current legacy environment, application/s utilization, interdependencies, data types and establish how it aligns with the current business objectives to determine the right approach to legacy application modernization.
Based on that you then prioritize your business objectives and align these objectives with the modernization path, available resources, and timelines. Your application assessment and business objectives will be critical drivers for identifying the various modernization options available. Here are some key questions that the organization needs to consider:
- How much business value is currently offered by the legacy application?
- What are the current operating costs for the application (infrastructure, license fees, staff, etc.)?
- Does the application meet your current and future performance and scalability requirements?
- Do you have skilled resources in house to maintain the application? In 1 year? In 5 years?
- Can the application be modified to meet your business goals in the current and future environment?
- What are the budgetary constraints to complete the project?
- What are timeline requirements to finish the project?
Five Best Approaches in Legacy Application Modernization
After careful evaluation of the current legacy environment, it is critical to select the right modernization approach that will be the most beneficial for both the business objectives and the obstacles. Depending on your goals, there are five most common approaches to modernization:
- Rehost– The practice involves re-deploying and running the application on another physical, virtual or cloud infrastructure without significant functionality, code and features changes.
- Refactor – This involves restructuring and optimizing existing code without changing its external functionalities. This removes technical debt and improves the component’s features and structure.
- Rearchitect–This involves altering the application code to shift to new application architecture and fully utilize new and enhanced capabilities of the new application platform.
- Rebuild – This approach involves rebuilding or rewriting the application component from scratch while maintaining its scope and specifications.
- Replace– Involves the rip-and-replace approach, which usually entails replacing with a different component or package with similar functionality.
The key to understanding if your organization’s problem/s is caused by technology, architecture or functionality of the application. The best choice for companies facing the skills shortage problem above is between rearchitect, rebuild or replace. The decision will depend not only the results or outcome but the costs and risks associated with these approaches. Modernization enables companies to meet customer demands quickly, scale to optimize application resources and value to the business and clients.
Take the Next Steps for Digital Success
Ready to start on the journey to modernizing your software? Using an agile modernization approach with proper planning coupled with the right people on your team will put your organization on a path to digital transformation success.
The development team at VantageOne Software is experienced in modernizing legacy application and working with clients who have complex environments. Our solutions are designed to deliver increased agility, security and productivity while driving down cost and minimizing disruption to business continuity.