June 8, 2022
Platform Modernization Trends
We are all digital now. And we don’t just mean online. We mean that the way we do business has changed, and it’s not going back.
The pandemic and its aftermath has made it clear: there’s no such thing as a “traditional” business anymore. If you want to survive and thrive in our increasingly digital world, then your business needs to be agile, lean, and focused on delivering value to your customers.
That’s why many businesses are turning to platform modernization. Platform modernization allows you to create an agile organization that can quickly adapt to changing market conditions and customer desires.
That’s also why updating your legacy system is mission-critical for your company. More importantly, taking steps to modernize platforms allows you to gain greater insights into customer problems and engineer solutions that deliver value. What’s more, adopting a mindset geared towards continuous improvement positions your company for future agility and growth.
With that goal in mind and using more effective customer experience as our lens, let’s dig into how implementing platform modernization can help you gain a competitive advantage.
The Role of the Pandemic in Accelerating Legacy Modernization Trends
The pandemic changed the world. That’s not breaking news. However, it’s important to note that the pandemic directly accelerated platform modernization. We’re still learning how the global marketplace adapts to change in response.
A study by McKinsey shows that the pandemic increased the rate of digitization by a staggering seven years. We saw remote working increase by a factor of 43 and the use of advanced tech in operations and business decision-making by a factor of 25. This isn’t surprising to anyone who lived through the pandemic. However, seeing the numbers in print emphasizes the drastic nature of our changing world. More importantly, it demonstrates how radically businesses must shift to accommodate rapid technological growth and dynamic market conditions.
This change didn’t come out of the blue. Many companies were already adopting a mindset of continuous improvement and working toward the trend of legacy modernization. The same McKinsey study shows that half of those previously on the fence state that the pandemic removed resistance to modernization. As a result, technology that supports agility went from a bleeding-edge principle to a “top business priority.” Platform modernization delivers increased ability to identify and react to new opportunities in the marketplace with innovative product development.
Whether or not you’re considering modernization as a reaction to changes brought on by the pandemic, one thing is clear. Adopting the platform modernization trend is more than getting with the times to be seen as forward-thinking. It’s about ensuring you can support your customers and deliver value as well as the competition.
The Cost of NOT Modernizing Your Applications
Upgrading your digital products and implementing organizational change requires investments of time, energy, and finances, particularly at the enterprise level. Resistance to change is one of the most significant reasons companies were hesitant to adopt platform modernization before the pandemic. Additionally, legacy systems come with elevated risks that include:
- Difficulty updating systems with bug fixes, requiring lots of workarounds and costly maintenance
- Increased security risks since legacy platforms don’t receive timely updates and security patches
- Lack of ability or slowness to react to changing market needs
However, the biggest cost of all is failing to adopt a mindset focused on driving growth, minimizing time to value, and quickly developing solutions to customer problems.
The Benefits of Modernizing Your Applications
Platform modernization delivers increased scalability and allows your system to grow with you. In addition to overcoming the challenges and risks mentioned above, legacy modernization leads to a greater agility to shift with marketplace needs.
Even more significantly, modernization leads to a greater degree of trust with your customers because you’re better able to develop innovative products and solutions. Also factoring in are minimized security risks associated with modern products, faster deployments of updates and feature rollouts, and improved communications and workflows. With that trust comes increased loyalty to your company and, therefore, increased revenue.
With that in mind, let’s explore some of the most common reasons companies are tackling modernization:
- Improving customer experience: Ultimately, customers don’t want to jump through hoops to work with your company. Sometimes this requires a complete front-end and back-end retooling, while other times, it’s a simple retooling of the front-end to streamline the user experience.
- Better security: No one wants to fall victim to a data breach. A secure digital product with updated security patches improves customer trust and minimizes the risk of a security-induced PR nightmare.
- Competing with startups disrupting the industry: Startups are often at the leading edge of tech and customer experience because they can fill gaps in the industry. Moreover, they don’t have decades of process bloat bogging them down. Modernizing allows you to streamline processes, focus on your main goal of solving for need, and remain competitive.
While this isn’t an exhaustive list, each scenario has one thing in common. They each give a specific reason for modernization. Modernization simply for the sake of following a trend isn’t a good reason to do it.
Bruce Steele, SVP of Solutions and Technology at 3Pillar Global says, “We’ve seen several companies where leadership made cloud migration a priority without first spelling out the desired business outcomes and benefits of planning and prioritizing the work. This yielded a disjointed implementation where maximum value was not realized. Software was modernized to microservices without a good deployment plan, which simply increased non value added technical debt. We encourage our clients to plan both the design and implementation to align investments that will maximize return in the form of improved user experience, cost benefits, and an improved security posture”.
If you’re unable to name a specific reason for the undertaking, you risk a long, complicated project without defined target outcomes. Instead, you must be able to answer why.
Technical Modernization Trends to Watch
Now that we’ve explored WHY companies take on platform modernization, let’s explore some specific trends from a technology perspective.
Over the past years, we’ve seen the rise of architectural styles aligned with modern DevOps, the most popular being microservices. Whereas monolithic platforms use a variety of processes that work together, microservices break these down into specific functions. Apps using a microservices architecture can use a variety of microservices to perform functions. Each microservice has a specific function but works well with its “peers.”
One of the biggest buzzwords today is User Experience, or UX. One of the biggest modernization trends is improving user interfaces for all users—employees and end users alike. In fact, just last year, a poor UX design cost Citi hundreds of millions of dollars when a judge ruled that Citi had to pay for “human error” after employees overpaid a bill by $800M.
Had their interface been more user friendly, the error could have been avoided, and Citi wouldn’t have been forced to absorb the cost.
This example spells out the need for frontend modernization to create a user-friendly and efficient experience. Updates include but are not limited to mobile optimization, UX, integrations, and more opportunities to make it easier than ever for customers to use your digital products.
When it comes to all of your business assets, data is one of the largest. Further, it’s a key principle of The Open Group Architecture Framework (TOGAF), which states, “Data is an asset that has value to the enterprise and is managed accordingly.”
Your outdated databases may need modernization just as much as your technology and processes. So what does this mean for your business? According to Deloitte, “Data modernization means moving data from legacy databases to modern databases.”
TOGAF goes on to say that because it’s “a valuable corporate resource” that’s used “to aid in decision making,” we need to be mindful of how we manage it. At 3Pillar Global, we believe that data must be optimized for AI and other modern uses. Therefore, in addition to choosing the best data model for your product, your data must be accessible, consolidated, and available in real-time.
In addition to accessing the data, data modernization allows AI and ML solutions to improve how we analyze data. In turn, it can help uncover the specific data needed for each request and improve the way you segment and serve your audience.
The Biggest Modernization Trend is a Strategic Approach
Regardless of the modernization and migration trends important to your business, taking a strategic approach is critical. After all, platform modernization is more than creating a new software account and flipping a switch.
Instead, it requires a top-down commitment to enabling innovation, improving consistency, and empowering decision-making. While there are multiple approaches to modernization based on your company, your processes, and your goals, an effective roadmap is critical for success.
Ready to find out how we can help you take advantage of the trends in platform modernization that are best for your business? Contact us today.
Special thanks to these members of FORCE, 3Pillar’s expert network, for their contributions to this article.
FORCE is 3Pillar Global’s Thought Leadership Team comprised of technologists and industry experts offering their knowledge on important trends and topics in digital product development.