What is a Legacy System and Why is Everyone So Worried About Them?

Are legacy systems really the end of the world? For many companies, they are business-critical technologies that keep operations humming and revenue flowing. But for all the bad press they get, you might think they’re set to be the downfall of business as we know it. 

Are they? Not necessarily. Can they be? Absolutely.

But to fully understand what legacy systems are and why everyone is so concerned about them, we’ll have to dig a little deeper. This post will look at what a legacy system is, provide some examples, and examine the value, risks, and challenges associated with them.

Before we can discuss the risks and challenges associated with a legacy system, we have to establish what we’re talking about. It’s surprisingly difficult to find a widely accepted definition of legacy systems – which can make it challenging to determine if it’s an issue at your organization. 

What is a Legacy System?

Legacy systems include computer systems, programming languages, applications, processes, or hardware that are:

• Inefficient to support or maintain
• Based on outdated technology
• Not compatible with more modern technical solutions
• Typically no longer available for purchase
• Often essential for day-to-day operations (more on this later)

Legacy Technology Examples and Use Cases

Legacy systems are everywhere. Any business that existed before fully-digital companies began emerging has had to – or will have to – update older systems if they want to compete in today’s digital space. Aging infrastructure and outdated technology comes in all shapes and sizes, but here are four more well-known legacy technology examples:

1. On-Premise SharePoint

Microsoft has announced the end of life for its 2013, 2016, and 2019 SharePoint Servers, with the final lights set to go out in July 2026. Research suggests that a significant percentage of finance, government, healthcare, and manufacturing organizations in North America are still using this tool – and many have no plans to migrate to something else.

Once considered ground-breaking, the on-premise version of SharePoint has become challenging (and expensive) to customize. It doesn’t scale well and lacks many reporting and oversight capabilities that are now considered standard.

2. COBOL

If you’re connected to the financial sector, you’ve probably been hearing arguments about COBOL for at least a decade. This programming language has been around for over 60 years and powers billions of ATM and credit card transactions annually.

COBOL’s age is not the issue. Skilled developers are already in short supply, and those with the expertise to translate COBOL code into more widely used modern languages are even more scarce. Even experienced developers can find it challenging to translate COBOL because of the unorthodox way it uses some standard coding statements.

3. SAP’s On-Premise ERP

Like SharePoint, SAP has announced plans to sunset support for its on-premise ERP in 2027. The existing model requires companies still using it to invest heavily in the development and maintenance of customized code to adapt it to today’s business processes. 

91% of SAP users say they are dependent on custom code, and  90% of the code in use falls somewhere between “important” and “extremely critical.” The costs to keep using the tool are already high and will only increase as new technologies and trends emerge.

4. Blackberry Phones

There was a time when 43% of smartphones in the US were Blackberries. Although the brand’s downfall was swift when it failed to adapt to changing consumer expectations driven by new models from Apple and Samsung, the company only finally announced the end of support for its operating system in January 2022.

Limits on Blackberry hardware and the company’s refusal to embrace tools that customers wanted – think keyboard in place of touch screen – cost the company market share and ultimately made the once-iconic phones obsolete.

Why Do Businesses Use Legacy Tech?

The need to replace systems that are outdated, challenging to support, and inefficient to maintain and use may seem obvious. So why do businesses resist legacy system integration and hold on to platforms and tools like the legacy technology examples listed above?

There are a number of reasons:

• “It still works!”

This is a common refrain among executives who resist digital transformation in favor of the tools they know and trust. It can be hard to recognize (or justify) the need to overhaul major systems when the existing solution – which employees are used to – appears to be getting the job done.

• “We can’t afford to change!”

Balancing revenue and costs is always a consideration. The price to upgrade, or worse, replace, business-critical tech is often high. In many cases, companies have invested substantially in existing systems, so bearing a slow rise in maintenance costs may seem preferable to scrapping it all and starting fresh.

• “Changing will disrupt operations!”

Legacy systems often play a vital role in day-to-day operations, so the prospect of shifting to a new solution (whose reliability is unknown) can be daunting. If sticking with older tech might be disruptive eventually, companies may take their chances rather than endangering operational continuity with a major change.

“Replacing legacy applications and systems with systems based on new and different technologies is one of the information systems (IS) professional’s most significant challenges. As enterprises upgrade or change their technologies, they must ensure compatibility with old systems and data formats that are still in use.”

Gartner

Legacy System Risks and Challenges

Concerns about transitioning away from legacy systems are not unfounded, but the risks of sticking with outdated architecture – however “tried and true” it may be – are not inconsequential either.

Businesses that continue to rely on legacy technology will see problems related to:

• Maintenance 

The cost of maintaining outdated systems will only rise as time goes on, support is discontinued, and fewer IT experts with the skills to keep legacy systems working – and connected to more modern tools – are available.

• Performance

The speed at which technology evolves is increasing exponentially. Legacy systems that don’t fail outright still won’t be able to keep pace with rising standards and rapid changes to market trends and consumer demands.

• Integration

The pandemic only accelerated an existing shift to doing business online, and a dependence on legacy systems can hamper digital transformation efforts and make adopting new solutions more challenging.

• User Experience

Reliance on aging or outdated platforms can negatively affect the experience you offer your customers. And the brand loyalty you’ve built can only carry you so far when you can’t meet expectations.

Digibee Can Help

Digibee’s innovative low-code enterprise integration platform-as-a-service removes the roadblocks legacy systems put in the way of your company’s growth and success. 

Our reusable integrations let even junior developers connect legacy systems to new technologies and tools to modernize your architecture and accelerate digital transformation without downtime or disruption to your operations. Book a customized demo and discover the Digibee difference for yourself today.