The Cost of Not Modernizing
The Cost of Not Modernizing
When developing a strategy for application modernization, there are several factors that an organization needs to consider, such as business objectives, system design, regulatory compliance, and more. Of course, cost will also be an important factor, and that discussion should also consider the cost of not modernizing.
In this article, we’ll discuss what happens when modernization is overlooked. A lack of modernization can lead to significant costs to your business, resulting from issues like lagging efficiency, security vulnerabilities, missed opportunities, and difficulty retaining talent.
Technology evolves quickly. Cloud providers continue to release new versions and generations of their infrastructure and services with the goal of continuous improvement. These improvements come in various forms: faster processors, increased throughput capacity, increased concurrency, greater resilience, and even more efficient energy usage. In addition, newer innovations may be released at lower price points resulting in even greater efficiency for organizations that are able to take advantage of them.
The result for those who choose not to upgrade is a widening gap with those in their industry who benefit from newer technology as innovations bring greater efficiency and the expectations of the market change. Companies using older technology aren’t necessarily becoming less efficient, but they’re perceived to be less efficient as they get outpaced by their competitors.
The concept of drafting comes to mind, where one racer stays within the slipstream created by a leader to reduce drag and perform more efficiently. The rate at which cloud infrastructure and services improve establishes a type of slipstream. Staying closely aligned to those newer technologies helps companies take advantage of those improvements early. You must do so to avoid falling behind your competitors who maintain that alignment.
These improvements are significant enough that AWS considers ignoring this principle to be high-risk and has included it in the Performance Efficiency Pillar of their Well-Architected Framework.
Benefits of establishing this best practice: By considering new services or product offerings, you can improve the performance and efficiency of your workload, lower the infrastructure cost, and reduce the effort required to maintain your services.
Level of risk exposed if this best practice is not established: High
Here’s a familiar story plot: a location is being defended against an attacking force that keeps looking for weaknesses and making small advances until, eventually, the defenders retreat, and the attacking force overruns the location.
Software systems are similar. Bad actors look for weaknesses and vulnerabilities in the software to exploit them. Software vendors and development teams respond in defense by patching those vulnerabilities to maintain the integrity of the software and protect the companies using it. Still, eventually, the system will age out of its support lifespan, at which point patches and security updates will no longer be released.
However, those bad actors continue to look for vulnerabilities. When weaknesses are found, no one can patch the software since the support lifespan has ended, and companies who continue to use the software are left vulnerable to attack.
Though modernization often involves taking advantage of newer innovations in the cloud, it can be as simple as bringing a legacy system up to date with modern operating systems and frameworks to continue benefiting from security patches and longer support lifespans to minimize the company’s vulnerability to attack.
The cost of neglecting this aspect of modernization is high, especially for organizations dealing with sensitive or valuable data. A company with sensitive data and systems is a valuable target for bad actors, making modernization even more critical.
The COVID-19 pandemic was a strenuous time for many companies, but some thrived and became real lifelines for people and businesses. Companies like Amazon, Grubhub, Netflix, and Zoom provided services that went from convenience to necessity overnight.
A common thread with many companies integral to pandemic life was a commitment to innovation that predated the pandemic. Commitment to innovation was a significant factor in positioning those companies to scale the way they did during Covid, not to mention enabling so many of us to weather a challenging time. Conversely, companies that had yet to focus on innovation and modernization found themselves scrambling to adjust, often paying a steep opportunity cost.
The point is that opportunities rarely announce themselves ahead of time, and capitalizing on them requires being nimble with the ability to scale in real-time when necessary. The ability to be agile is one of the primary selling points of cloud platforms, but simply moving an application to the cloud doesn’t guarantee you’ll be able to scale how you need to. Some legacy systems may not be able to leverage innovations until dependencies are brought up to date and architectural patterns are refactored.
If the cost of modernization seems high, consider this: Modernizing now always costs less than modernizing later because the delta between your system’s current state and modern technology’s current state will only continue to grow. Eventually, the effort required to modernize could become significant, with timelines extending beyond a window of great opportunity.
The last issue we’ll look at is talent. I have recently encountered a few companies still relying on applications built on severely outdated technologies. I’ve also interviewed several job candidates who have told me they’re looking to move on from their current employer because they feel their skill sets are becoming outdated. Some support older applications, and some work for companies that don’t intend to modernize. However, each of those developers realizes they need to keep their skills up to date if they want to be marketable.
When these employees move on, their companies will need someone to take their place, but those companies will likely find themselves in the same position again before long. As time passes, finding and retaining developers to maintain these systems will be increasingly difficult.
IT professionals want to work in technologies that are relevant. If they feel their skills stagnate, they will begin to look elsewhere, and eventually, their roles will become difficult to fill.
A company in this position should consider the cost of finding, hiring, onboarding, and retaining new staff to maintain those aging systems. Then they should ask, “How often are we willing to pay that, and is it worth it?”
When a company includes technical innovation and modernization in its IT strategy, technical staff interpret it as additional growth opportunities, motivating them to stay on board. The result is that the company continues to benefit from their investment in their team and the institutional and system knowledge that the staff has acquired.
If you’re looking into modernization for your business, you will no doubt consider the costs associated with the effort. But don’t stop there. Instead, compare that to the cost of lagging efficiency, security vulnerabilities, missed opportunities, and the costs of hiring new staff. As a result, you may find that including modernization in your ongoing IT strategy is more cost-effective.
You can read more about Preparing for Application Modernization in our previous post or contact Technossus for help with your modernization strategy.