Legacy systems, otherwise referred to as old core systems are the former backbone of IT within companies that are still using them. According to Gartner, this includes hardware and software that often has only a few core functions that, while outdated, are still critical to the operations of the organisation.
Replacing legacy systems is a key challenge for many IT teams, due to the perceived complexity, and also due to the need for backwards compatibility. Over time, as organisations have needed different programs to ‘talk’ to each other, core systems may have been adapted and added to with a variety of fixes that allowed the programs to communicate.
The downside to legacy systems
Changes to old core systems typically require lengthy projects with specialist IT staff who will roll out improvements or modifications over a period of many months.
Because each business function is siloed, each area requires staff to know and understand their system, making it a lot harder for personnel to move between departments and programs.
For customers, the experience of interacting with the organisation is fragmented and frustrating, as they are passed from department to department to help with their questions.
Since these systems lack a holistic view of the organisation and data coming in, employees are restricted by the data and how responsive they can be to emerging issues and trends.
Yet replacing core systems is a challenge which cannot be delayed indefinitely. These siloed systems have a set lifetime—where organisations pay annual fees for user licenses, software updates and security patches. Many systems will still keep running even after the support expires, but they become more costly to maintain and are at risk of security breaches and increased downtime for maintenance.
The comparison: new versus old core systems
Move away from siloed business processes to fully integrated business processes.
The future is a new core
While older core systems may have been valued for their reliability, their siloed architecture lacks the agility and flexibility demanded by customers and the wider organisation, focused as it is on speed to market, digital ecosystems and partnerships, along with improved customer and user experience.
The new core systems offer an alternative. A fully integrated approach to managing systems, data and risk. Each business function can easily and quickly communicate with others and data is collected and stored centrally in real time.
The shift to remote and flexible working is a lot simpler to set up and manage with a new core system— all staff are using the same system and can more easily move between roles and functions when assisting clients.
For many organisations customer experience management (CXM) is now part of the new core set of systems. Its functions remove the burden of data entry and administration through workflow automation. CXM also reduces the risk of data errors, provides customers with access to their own data at the click of a button and lightens the load on customer service and administrative staff.
Built-in digital communication processes make sending customised communications a breeze. No more days of printing off letters, cross-checking details and stuffing envelopes by hand, then waiting weeks for a reply!
A wealth of data that can be collected, stored and efficiently managed makes it easier to respond to customer needs, plus engaging existing customers with personalised marketing campaigns and service upgrades.
Vitally, having the ability to create microservices and connect with other services via API’s allows for virtually unlimited new core system expansion.