Legacy Systems vs. Modern Systems: 5 Things Organizations Can Do Better By Modernizing Legacy Systems
Private sector organizations in the financial, retail, telecom space are raising the bar when it comes to customer service and engagement. Customers expect, but unfortunately do not receive, similar experience from their government agencies. One reason is the antiquated systems and processes used by agencies to deliver services.
A Center for Digital Government survey found that 70% of respondent agencies depended on legacy applications (built using COBOL, PowerBuilder etc.) for their operations.
Legacy technologies like COBOL, PowerBuilder etc. were popular once and may still help an agency ‘do its job’. But they are not easy to maintain. IT teams recognize this challenge and want to modernize. Unfortunately, they find it extremely difficult to get buy-in from their business teams, who worry about the risk of disruption and are anxious about learning a new system.
In this blog, I outline 5 things that business teams can do with a modern system that they cannot with the old one, and how modernization can benefit them, their agency, and their customers.
1. Shift focus from IT operations management to service delivery
Providing frictionless services to customers is the foremost goal of any government agency. This is not possible if the staff is constrained by the systems they use or if they spend more time navigating and fixing these systems than servicing the customer.
Legacy systems typically predate the people who manage and use it. These systems usually have been updated often and have grown in complexity making it extremely difficult for agencies to maintain these legacy systems. If there is an issue with the system, business users have to get involved to fix it. This is not a good use of their time.
Business users can shift the focus back to service delivery when they stop worrying about IT operations. And, this is possible when agencies transform their legacy systems into modern, easy to maintain systems.
This is what a transportation agency was able to do when it modernized its 40-year old licensing and registration system. From delivering all the information about a customer (360-degree view) up to 90% faster, to processing applications faster by up to 70%, and to offering self-service options, the agency enabled its staff to focus more on, and better engage with, customers.
2. Quickly respond to regulatory, business and/or customer demands
With legacy systems, an agency will always be playing catch up with business, customer or regulatory demands and may run the risk of non-compliance. For example, the US Department of Defense was unable to use cutting-edge cyber security tools due to its legacy operating system. In cases like this, legacy systems must be updated before innovative and often critical new technology can be implemented.
A modern system will be able to adapt to changes more quickly, enabling an agency to meet regulatory, business or customer demands more effectively. Long Term Care Partners, for example, realized this when they wanted to use their legacy system for administration of programs other than their flagship long term care program. LTCP’s core administration system worked fine but couldn’t support other programs. LTCP used a software + people approach to modernize its legacy system to a web-based application. Not only was LTCP able to accelerate this exercise and support new programs, but was also able to reduce operational cost by approximately 20% and increase productivity of its users by 25%.
3. Reduce the risk of downtime and deliver un-interrupted services
The technologies on which legacy systems are built are either out-of-support or will be reaching their end-of-life soon. This increases the risk of disruption and also impedes an agency’s ability to plan for the long term.
One of our clients – a large City in the US – was facing this exact situation. Their tax system was built using PowerBuilder and integrated with external systems through a utility hosted on an Enterprise Architecture (EA) Server. Support for the server was going to be discontinued and the City was facing the serious risk of being unable to exchange information with other systems. To avoid this scenario, the City decided to modernize its system into a digital, web-based system built on Java. This not only allowed them to assure uninterrupted data exchange with other systems but also gave them the flexibility to connect with additional systems in the future.
Modern systems, planned and implemented properly, enable agencies to avoid scenarios like the tax system example above. Not only are they easier to maintain or fix but they also ‘get along’ well with internal and external systems, minimizing risk of disruption.
4. Reduce operational cost and use savings to fund other strategic initiatives
Legacy systems are expensive to maintain. Studies estimate that organizations spend 50% to 80% of their IT budget on maintenance of legacy applications. This is especially true for technologies like PowerBuilder and COBOL where skilled experts are rare to non-existent. Modern, web-based systems in contrast save as much as 30% in operational cost. Agencies can invest these savings to further their core mission.
This is exactly what one of our public sector clients did. They converted their legacy PowerBuilder based system to a modern Java-based application, saving approximately 20% in operational expense and invested these savings in other areas.
5. Enable the staff to do more and be more
Government agencies are facing significant staffing challenges as many public sector veteran staff reach retirement age. Increasing productivity is a key to addressing this gap, however, legacy systems are a major drain on individual productivity. For example, at a transportation agency, a typical licensing request took more than 45 minutes to process. This left little time for users to do anything else.
When agencies modernize, improvements in systems go hand in hand with improvements in processes, enabling users to do more, faster. In the transportation agency’s case, users were able to process applications nearly 70% faster after system’s modernization.
Agencies can put these time savings to good use. Employees can build skills through new educational programs or be engaged in the development of new products/innovations – the possibilities are endless.
Modernization of legacy systems can help agencies deliver a better user experience, reduce operational cost, minimize the risk of disruption, and enable employees to do more. I summarized how agencies can realize these benefits. There are approaches, like software + people approach and solutions, like ModernizeIT, that can help agencies realize all these benefits quickly, cost-effectively, and at minimal risk.
Kunal is a Principal Marketing Manager with Infosys Public Services, a US-based subsidiary of global IT company Infosys (NYSE:INFY). Infosys Public Services offers business consulting and technology solutions to the US and Canadian public sector organizations. Kunal leads the marketing practice and is responsible for building the company's brand and driving growth. Kunal defines and executes marketing and brand building campaigns, and manages marketing operations including budgeting, procure-to-pay process, and financial reporting.