The Risks of Outdated Technology: Why Legacy Systems Cost You More Than You Realize  


July 26, 2017

For most businesses, technology is something of a double-edged sword. On the one hand, it helps you run your business and remain competitive. On the other hand, updating hardware and software requires ongoing investments in time and money.

Technology is evolving rapidly. Something that’s state-of-the-art today may be woefully obsolete in a year or so.  Learning how to use new tools, especially when you’re comfortable with what you’re used to, can be time-consuming and frustrating.  Plus, implementing a new infrastructure can be costly and has the potential for major business interruptions.

No wonder so many business owners hold onto legacy systems far longer than they should. But keeping around outdated technology can actually increase costs and decrease productivity.

What Are Legacy Systems?

A legacy system is any piece of hardware or software that was once widely used but has long since been replaced with something newer. Age doesn’t necessarily make a solution a legacy. It could be regarded as outdated because a newer version has been released and the vendor no longer supports the system.

However, when looking to update technologies, one of the biggest concerns most business owners have is how to justify the cost. The question then is—What’s the cost of keeping outdated technology?

The Trouble with Outdated Technology

Installing a new piece of software in a business setting isn’t like installing one on your home computer. You need to move data from one platform to another, and train people to use the new solution.  These are understandable concerns. However, it’s also true that the benefits of replacing outdated technology far outweigh the risks of keeping a legacy system.

The cost of maintaining legacy systems can quickly become burdensome to a small business trying to keep budgets under control. Experts agree that the ability to provide timely IT solutions to an organization that uses an older, legacy infrastructure is essentially impossible.  Make no mistake – there will come a point where you’re spending more money to maintain your legacy systems than you would if you had upgraded everything when you should.

Decreased security is a huge concern when it comes to using legacy systems. Technology companies combat this problem by constantly releasing security updates for the at-risk software. However, once a legacy system is no longer supported, you won’t receive security patches from the developer. Plus, backup and disaster recovery become insurmountable challenges. You’ll never be able to properly safeguard the work you’re doing today, and you’ll always live with the worry that data loss might be just around the corner.

If your business is under stringent regulatory compliance requirements, the cost of outdated technology can have serious repercussions. Compliance standards, like HIPAA, PCI, SOX, and others, require that your technology be supported. This sets you up for fees and penalties if you experience a data breach (which are more likely due to security holes in your legacy system).

And, whether you’re talking about software or hardware, older systems have increased failure ratesThis makes system downtime simply unavoidable. The consequences of downtime can be grave for small businesses and you risk losing customers forever if your services are inaccessible.  Here are just some of the costs you can occur when your legacy system fails:

  • Expenses for IT recovery and data restoration (if even possible!)
  • Dissatisfied customers (who may leave for the competition)
  • Lost sales
  • Brand/loyalty damage
  • Lost employee productivity
  • Potential employee overtime costs to meet deadlines after the failure
  • Low employee morale and turnover due to stress

Another problem with using outdated technology is thatoldandnewtechnology very rarely work together. Most legacy systems are incompatible with newer systems. It’s essential that software, no matter how old, integrates well with the tools and applications you require to efficiently run your business.  And, if your legacy system prohibits you from using new, advanced capabilities, chances are your competitors are.  This means you will continue to lose customers and revenue, putting your business’s existence at risk.

Mobility is impaired when using legacy systems.  If your employees work in the field, such as with construction, warehouse control, oil and gas production, or logistics, their performance will be improved, and your business more efficient, if they can use mobile devices that connect to your inventory, production and other management software.

If your employees can’t access your legacy software from any mobile or computer device other than your office computers, you’ll, once again, fall behind your competition in terms of performance and revenue. Cloud-based SaaS products outperform any on-premise system.

Legacy systems inhibit business scalability and growth. Can your legacy software support increased production capacity and your company’s growth? As your business grows you’ll have changing technology needs. Your business is constantly evolving, and your software must be able to keep up. If not, you’ll be forced to adapt your business to your legacy system, and this will “stunt” your ability to grow your business.  With increased scale and demand, you’ll require better throughput capacity and a completely new IT architecture to manage all your operations.

When you consider all of this, does it make sense to hang on to an outdated system just because you want to save a little money? The answer is simple It doesnt.

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