22 Signals to Modernize Your Legacy Software

Stick with the 'good old things' or urgently upgrade? Learn the signals that can help you make the right choice.

In today's fast-paced and ever-changing business environment, keeping up with the latest technology and staying ahead of the competition is crucial for success. Many organizations still rely on legacy software that can hinder their ability to adapt and compete. Outdated software can cause problems with maintenance and upgrades. It can also make it hard to comply with new regulations and give customers a better experience.

Software modernization is becoming increasingly urgent, but organizations may need help knowing where to start or what factors to consider. This study will explore the critical red flags that indicate it's time to modernize your software. By being aware of these indicators, you can ensure that your company operates effectively and efficiently in this aspect and lower the likelihood that competitors will overtake you.

So, what are these red flags? Let's dive in and explore the list you need to be aware of when evaluating your legacy software.

What is Legacy Software and Why Should You Care?

Legacy software refers to outdated computer programs designed and developed many years ago but still used today. These programs are often written in old programming languages and use old hardware and software systems. It makes it hard to keep them running and update them.

Modernizing legacy software is crucial for businesses, as it allows organizations to stay ahead of the competition and meet the ever-evolving needs of their customers. With new technologies and business processes emerging, keeping up-to-date and flexible is essential. Modernizing legacy software helps businesses achieve the following:

  • increased efficiency and productivity
  • better security and compliance
  • improved customer experience
  • enhanced business growth and profitability

This article provides a comprehensive overview of the key factors and parameters that organizations should consider when evaluating their legacy software. We've compiled a list of 22 red flags that indicate that legacy software needs modernization. By understanding these red flags, organizations can determine whether their legacy software is holding them back and take the necessary steps to modernize their systems. By reading this article, you'll learn when software needs modernization and what to do to ensure your business stays ahead of the curve.

Signs That Your Legacy System is Urgently in Need of Modernization

System Performance Issues

System performance issues are a significant indicator that your legacy system requires modernization. These issues can manifest in various ways, such as slow response times, frequent crashes, and the inability to perform essential tasks. These issues can cause significant downtime, poor productivity, and decreased customer satisfaction, ultimately impacting your bottom line.

Slow and cumbersome

Slow performance and cumbersome functionality are significant indicators that your legacy software needs modernization. A system that is slow to respond or consistently crashes is frustrating for users and can negatively impact the productivity and efficiency of your business operations. In today's fast-paced and competitive business world, having slow and hard-to-use software can cost you time and money and put your business at a disadvantage.

The delays caused by slow software performance can quickly accumulate and significantly impact productivity. For instance, if 100 employees each spend an extra 5 minutes every day waiting for reports to load, that's a total of 500 minutes, or 8 hours and 20 minutes lost every day. To put this in perspective, this is equivalent to one of your 100 employees loafing around the water cooler all day instead of doing his duties.

Frequent crashes or failure to perform

Frequent crashes or failures to perform are major red flags that your legacy software needs to be modernized. In today's fast-paced business environment, having an unreliable software system that crashes frequently can significantly impact your business operations. Research has shown that software that crashes often can lead to less work getting done, lower morale among employees, and lower customer satisfaction.

Numerous studies have revealed that it takes substantially longer than often assumed for people to regain focus following a job interruption: 23 minutes, according to a UC Irvine report, and a 20% drop in cognitive function, according to Carnegie Mellon University. By figuring out how much time and work are lost every time the system stops working, you can see how serious this may be.

The economic impact of having an unreliable software system can be far-reaching and devastating. When a software system crashes, it not only disrupts employee workflow but also puts customer relations and profits in jeopardy. Poor software quality has cost US organizations a tremendous $2.41 trillion in 2022, according to a report by the Consortium for Information and Software Quality (CISQ). It should be noted that software failures are directly related to only a portion of these costs; however, even in this case, the scale is shocking.

Incompatibility with modern software

Concerning compatibility, your software must integrate seamlessly with the other tools and applications required to run your business operations effectively. Failure to address compatibility issues within your systems, regardless of their age, can have disastrous consequences.

For instance, if you cannot implement alternative customer support channels such as online self-service, live chat, or email support because of limitations imposed by your outdated systems, many customers will look for another provider rather than request assistance via phone. Also, these ways to help customers are much more efficient and cost-effective than a traditional call center.

It's vital to keep up with emerging technologies to stay ahead of the competition and meet customers' changing needs. If your business remains tied to outdated systems, you'll miss out on the benefits of the advanced capabilities of modern technology. Chances are, your competitors have already integrated these new tools and resources, putting your business at risk of losing customers and revenue. To stay competitive, you must always look at your technology infrastructure and make any necessary changes to ensure it works with new software.

Lack of mobile capabilities

In today's business landscape, having mobile capabilities is a must. According to a survey by Red Hat, 89 percent of organizations have already partially implemented a mobile app strategy. If you cannot access your software from devices other than your office computers, your business performance and revenue are at a disadvantage compared to your competitors.

Mobile capabilities are essential for companies that work in the field, such as in construction, warehouse control, oil and gas production, or logistics. When workers can use mobile devices to do things like to manage inventory, their performance and efficiency go up a lot.

Furthermore, in terms of mobility, cloud-based SaaS products outperform on-premise systems. While complete system modernization may not be feasible for every business, you can implement a partial enterprise mobility strategy. Legacy software, for example, can be supplemented with mobile tools that enhance specific features and provide additional benefits. However, it is critical to consider any potential integration issues. Old systems frequently require a significant amount of custom code and workarounds to function correctly with new tools.

High hardware usage

Legacy software that relies on excessive hardware usage can significantly impede the performance and efficiency of a business. As technology has advanced, modern software is typically cloud-based, allowing organizations to reduce the amount of physical hardware they need to run their processes. On the other hand, legacy software bought years or even decades ago mainly relies on bare metal hardware to run, which adds to costs and makes it harder to manage.

The continued reliance on hardware indicates that the software is outdated and needs modernization. By using cloud-based solutions such as Amazon Web Services, Microsoft Azure, or Google Cloud Platform, organizations can reduce their IT infrastructure costs by an average of 65% in the first three years. The more servers an organization needs to run its systems, the more money it could save using cloud-based solutions.

Tools such as the Azure TCO Calculator can provide insight into the cost savings of cloud computing versus on-premises hardware, making it easier for organizations to see the benefits of modernization. By reducing the amount of hardware they use, organizations can free up resources and improve their bottom line while providing their employees with more efficient and practical tools.

Technical Limitations

Legacy software can also be hindered by technical limitations that make keeping up with business growth and changing needs difficult or even impossible. If it is based on obsolete technologies and was designed using unusual (or out-of-date) principles, and the vendor has stopped supporting it, you are in big trouble. The inability to add new features to such legacy software, or even to use it efficiently, may cause you to fall far behind the competition.

No longer supported by the vendor

When your business relies on third-party software, you inherently depend on the vendor for updates and maintenance. Vendor support can reach its end, whether due to company acquisitions, bankruptcy, or other reasons. When this happens, it's a clear sign that your software solution might not be the best one for you.

If you stick with an unsupported software solution, you'll miss out on updates and will not receive any assistance when encountering issues. For instance, if your business operations still run on Windows XP, you will not be able to use the latest versions of Microsoft products and will be stuck with outdated software. The OS is officially no longer supported, so it's not the vendor's fault. You'll need to update your system to the latest version or upgrade your hardware if it doesn't support updates.

Another downside of using unsupported software is that you won't be able to use your warranty in case of a system failure or data loss. Some businesses may still use outdated software and technologies, despite the drawbacks of poor stability, lack of compliance with modern web standards, and poor security levels. In the author's real-life practice, a client was using an old version of Internet Explorer that had reached the end of its support six years earlier. The client couldn't upgrade because the software they used to access legal documents was built a decade ago on old ActiveX and used some undocumented features.

The underlying technology is obsolete

The underlying technology in your software is vital in determining if it needs to be modernized. While some older programming languages and tools still have a long lifespan, it's the technologies that have officially reached their end-of-life that pose the biggest threat to your business operations.

Adobe Flash, once a popular web development tool, is no longer supported by Adobe as of December 31st, 2020. Flash Player can’t be installed on modern browsers. Microsoft Silverlight is another dying technology, as modern browsers, including Microsoft Edge, no longer support it.

To stay ahead of the curve and keep your business running smoothly, it's crucial to stay informed about the technologies you're using and whether they are still being supported. Lack of security, poor performance, and the inability to integrate with other tools are common companions of software built on obsolete technologies.

When faced with the need to modernize your software, keep in mind that simply updating your technology will not always suffice. Sometimes, it may be necessary to completely reengineer your software to ensure it runs on up-to-date and secure technologies. This will help you avoid the risks associated with running outdated software, such as security breaches and lost data.

Requires extensive training or special skills

How much time do new employees typically spend learning to use some of the tools your company relies on? Are the concepts behind the user interface of the software you use widely known so new employees can get started immediately because they "already worked with similar apps in another company"?

Legacy software with clunky interfaces can be a real challenge for your business operations, especially when it comes to training new employees. Built before the advent of modern UI/UX standards, these systems often lack clarity and ease, making it difficult for even experienced users to work efficiently. Becoming an expert with such a system can take years, and hiring new employees to replace the old ones can be time-consuming and costly. According to the SHRM HR Comparison Report, the average cost of hiring is estimated at $4,683. Why should you spend even more on training?

Not only does outdated software make the staffing process more challenging and expensive, but it can also significantly slow down operations. If your employees struggle to use your system efficiently, simple training may not be enough to speed up your processes. This can be a real hindrance to your business' growth and competitiveness.

Difficulty in adding new features

A legacy system can present significant difficulties when it comes to adding new features to your software. If the system is not a black box and you have access to the source code (and legal grounds to modify it) or APIs that you can use for extensions, you may still face challenges.

Legacy systems often lack flexibility and adaptability to be easily changed or expanded to include new capabilities. Workarounds can lead to an outdated technology stack or an architecture that is too complicated, making it hard to add new features.

Suppose your team has to invest significant time and resources into writing custom code to implement even simple features. In that case, it's a clear sign that it's time to consider modernizing your software. Keeping a system in place that is old and rigid will only make it harder for your business to change and grow.

Inability to keep up with business growth

The inability to keep up with business growth is another drawback of using outdated software. As businesses grow, their needs and requirements change, and the software they use must keep up with this growth. Legacy software, however, doesn't always keep up with these changes, making it harder for businesses to meet the needs of their growing customer base.

One of the main reasons for this is the rigidity of legacy software. Unlike modern software designed to be flexible and scalable, legacy software is often designed for a fixed number of users and a specific set of requirements. As the business grows and the number of users increases, the software becomes increasingly strained, leading to slowdowns, errors, and other performance issues.

In addition, legacy software is often limited in terms of its ability to handle spikes in demand. For example, suppose a business experiences a surge in traffic during a busy season. In that case, the software may not be able to handle the increased load, leading to crashes, data loss, and other problems. This makes it increasingly difficult for businesses to keep up with the demands of their growing customer base and can ultimately lead to customer frustration and the loss of business opportunities.

Security and Compliance Risks

As the world becomes increasingly digitized, new regulations have emerged to protect sensitive data and ensure privacy. In recent years, regulations such as the European Union's General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) have been implemented to safeguard the personal information of individuals. It is crucial for software systems to comply with these regulations, as non-compliance can result in hefty fines and damage to a company's reputation. In this day and age of cyber threats and data breaches, it is also crucial for businesses to use software that puts security first and protects sensitive information.

Vulnerabilities to cyber threats

The use of outdated software can be a severe source of cyber-security vulnerabilities. BDNA's State of the Enterprise Report highlights that organizations that do not have processes to identify and address these end-of-life (EOL) assets expose themselves to cyber criminals looking to exploit unprotected weaknesses.

One of the biggest reasons older systems are more susceptible to malware and breaches is that the methods used to secure them have become outdated. What was considered secure ten years ago may not hold up to today's threats. For example, many older systems still accept weak passwords that hackers can easily exploit. On the other hand, modern systems require stronger and more complex passwords, making them much less vulnerable to attack.

In addition, as new technologies emerge and cyber threats become more sophisticated, older systems may not have the necessary patches or upgrades to stay protected. This leaves them open to exploits that could compromise sensitive information and disrupt business operations. Because of these reasons, it is important to regularly audit your software security methods to ensure that your organization is safe from the latest cyber threats. Audit reports may give you undisputable reasons for urgent modernization.

Outdated encryption algorithms

One of the critical security risks that legacy systems face is the use of outdated encryption and hashing algorithms. For example, once considered secure, the MD5 hashing algorithm has been shown to be vulnerable to attacks and is now widely regarded as insecure. This means that any data that was hashed using MD5, such as passwords stored in a database, is potentially at risk of being compromised.

In today's world, where cyber threats are on the rise, the use of outdated encryption and hashing algorithms leaves your business vulnerable to attacks and data breaches. Modern encryption algorithms, such as AES and SHA-256, provide a higher level of security and should be used in place of their outdated counterparts. Also, the current software is designed to use these updated algorithms, while older systems may still use the old ones.

It's essential to have up-to-date encryption and hashing algorithms in place to protect sensitive data and ensure compliance with industry regulations. A data breach resulting from using outdated encryption algorithms can have severe consequences for your business, including reputational damage, loss of customer trust, and financial penalties. The best way to protect your business from these security risks is to replace your old system with a new one that uses more robust encryption algorithms.

Lack of security patches

As software ages, the frequency of security patches and updates decreases, making legacy systems more vulnerable to cyber threats. Studies have shown a direct correlation between software age and the frequency of security patches being released. The time between identifying a vulnerability and releasing a patch also increases as the software ages. This is a tendency for software that its vendor is still supporting. However, if you no longer have an active support contract with the vendor, the chances of receiving security patches are minimal.

Each year, dozens of high-risk CVEs (Common Vulnerabilities and Exposures) are released, and it is highly likely that some of them relate to your legacy software. If you are uncertain if these vulnerabilities are being actively exploited, there is an easy way to verify this statement. Ask your system administrator to check your website's access logs and see how many attempts to access "/wp-login.php" (the WordPress admin interface login page) were made last month. You might not use WordPress or PHP at all. It is a trace of botnets randomly probing websites for known vulnerabilities to find outdated and, thus, vulnerable ones. It demonstrates how important it is to stay updated on security patches, as cybercriminals can still target obsolete systems and software.

Non-compliance with regulations

Another significant issue with legacy systems is non-compliance with regulations. This statement is not only true for industries that are heavily regulated, such as finance, healthcare, and government. Organizations are already grappling with the challenges of complying with regulations such as the General Data Protection Regulation (GDPR) in Europe and the California Consumer Privacy Act (CCPA) in the United States.

According to a study by the Capgemini Research Institute, legacy IT is one of the biggest challenges organizations face in preparing for the CCPA, with 42% of respondents citing it as a significant challenge. The outdated technology and architecture of legacy systems can make it difficult or even impossible for organizations to comply with the strict data privacy regulations set forth by these laws.

For example, under the GDPR, organizations must implement appropriate technical and organizational measures to protect personal data, including the ability to quickly remove or rectify data if requested by the data subject. However, if a legacy system was not designed with these requirements in mind, it may not have the necessary controls or processes in place to meet these obligations. Similarly, under the CCPA, organizations must provide consumers with the right to request access to their personal data and the right to request that their data be deleted. If an organization's old system doesn't have the right features, it may be hard or even impossible for them to meet these obligations and comply with regulations.

High Costs of Maintenance and Support

Legacy systems often come with high costs of maintenance and support that could affect your organization's bottom line. The costs can come in various forms, from increased operating expenses to lost opportunities due to outdated technology. We will discuss these costs and why it is essential to consider them when deciding if modernization is needed.

High operating costs

High operating costs can be a significant red flag that your legacy system needs urgent modernization. If your legacy software is not designed to run in the cloud, you are likely overpaying for servers, whether you have purchased or are renting them. This can result in a lack of utilization of your server's capacity, where you are paying fully for resources you are not fully utilizing. Performance problems can also happen from time to time, which can cause even more problems and possibly some downtime.

Legacy systems often require specialized hardware, which can be expensive to purchase and maintain. This hardware can also become outdated quickly, leading to further costs associated with upgrades and replacements. Also, it may be hard to get the required hardware, which can cause delays and extra charges when trying to get replacement parts.

Another factor contributing to high operating costs is the need for specialized staff. Running a legacy system can require a unique set of skills, which can be challenging to find and retain. In addition, you may need specialized staff to be on call 24/7 to address any issues with the system. This can result in high costs associated with staffing and training, and it can also be challenging to find replacements if key personnel leave the organization.

High support and maintenance costs

When considering the high support and maintenance costs of a legacy system, it is critical to evaluate the scarcity of engineers capable of working with obsolete technology. Many of these old technologies are no longer supported or updated by their makers, which makes it harder to find experts who know how to use them. This makes the problem worse.

Some examples of these technologies are older versions of .NET or Java and less common ones like RAD platforms like Delphi. We have a client who used an old .NET-based custom app, and after modernization and migration to a cloud-based infrastructure, they were able to cut their expenses by six times compared to their previous rented server. Additionally, their performance metrics improved dramatically.

Another example is an enterprise with several HPE Gen7 servers that have been out of support for years. There is no option to migrate the core legacy application to newer servers or the cloud because the vendor no longer exists. This leaves the business constantly at risk of inevitable failure. The phrase "don't touch it while it's working" often comes to mind, but only God knows how much effort it takes for administrators to keep those servers alive and functioning. These high support and maintenance costs can be a significant drain on a company's resources and should not be overlooked when considering a legacy system modernization effort.

Lost opportunities due to outdated technology

Legacy software, as well as the hardware it runs on, can often hold businesses back from fully taking advantage of the opportunities presented in today's fast-paced digital world. If your software cannot keep up with high demand during peak times such as Black Friday, it may be a sign that it's time to modernize. Outdated technology can hurt your bottom line by causing you to lose sales and making customers unhappy.

In addition to performance issues, outdated technology can also limit a business's ability to make data-driven decisions. With limited analytics capabilities, companies may be blind to important insights that could inform their strategy and drive growth. In today's data-driven world, this can put a company at a major disadvantage compared to competitors who have invested in modern technology.

Another area where outdated technology can negatively impact a business is in its ability to automate and streamline operations. With the rise of artificial intelligence and machine learning, many companies are turning to these tools to improve their operations and save time and money. However, you could miss these benefits if your software and hardware are not equipped to handle these cutting-edge technologies, you could miss these benefits. Also, organizations that use old software may fail certifications or lose contracts because of security flaws.

Negative impact on customer satisfaction

The negative impact of outdated technology on customer satisfaction can be significant. For example, customers expect fast and seamless online experiences, but outdated software may not be able to provide this, leading to frustration and decreased customer satisfaction. Additionally, if the software used by a business is not secure, customers may hesitate to share personal or sensitive information, affecting the trust they have in the organization. Outdated technology may also limit the ability of the business to offer new and innovative products or services, which can further impact customer satisfaction.

In the fast-paced digital world, customers have come to expect the latest and greatest technology. If a business cannot keep up, it can quickly fall behind the competition. For example, if a customer cannot complete a transaction due to outdated software, they may move on to a competitor who offers a more modern and streamlined experience. This affects customer satisfaction and can lead to lost revenue and decreased brand reputation.

High cost of downtime

Downtime is a common issue for legacy systems, resulting in significant financial losses for organizations. Outdated technology is more prone to failure and requires constant maintenance and support, leading to unexpected downtime that can impact the bottom line. Also, in today's highly competitive business world, even a few minutes of downtime can greatly affect how happy customers are with a brand and how well the brand is known.

For example, an e-commerce company that relies on legacy systems to process online transactions could lose significant revenue if their systems were down for just an hour during peak shopping hours. This can also lead to frustrated customers who may choose to do business with a competitor. In the same way, a financial services company that uses old systems to process transactions could face fines and penalties if they have long periods of downtime that cause transactions to be delayed or lost.

It's important to note that the cost of downtime goes beyond just lost revenue. Organizations must also consider the cost of investigations, troubleshooting, and recovery efforts. In some cases, they may even need to hire outside experts to help them get their systems up and running again. All of these factors contribute to the high cost of downtime associated with legacy systems, making it a critical issue for organizations to address.

Damaged User Experience

As technology continues to evolve, user expectations are also growing. Customers expect seamless, fast, and user-friendly experiences from businesses they interact with, especially when it comes to digital experiences. The way customers interact with businesses through their digital channels is becoming increasingly important, and, as a result, outdated technology can result in a damaged user experience.

Poor user satisfaction

One of the most common signs that legacy software needs to be updated is that users aren't happy with it. When users are frustrated with the software they are using, it can lead to low morale, reduced productivity, and negative customer reviews. Finding and fixing the issues that are frustrating users is essential to keeping them happy with your software.

There are several signs that your legacy software is causing poor user satisfaction. One of the most obvious is when users consistently report slow performance, crashes, or errors. Additionally, if users cannot access the software from multiple devices or remote locations, this can also lead to frustration and decreased productivity. Finally, if the software does not meet the users' needs or cannot integrate with other tools and systems, it can also lead to poor user satisfaction.

It is important to invest in legacy software modernization to avoid these issues and ensure that your users are satisfied with the software they are using. Updating your software to the latest technology ensures that it is fast, reliable, and accessible from anywhere. Additionally, by incorporating the latest features and functionality, you can also ensure that the software meets the evolving needs of your users. Ultimately, by investing in legacy software modernization, you can ensure that your users are happy, productive, and able to do their jobs effectively.

Decreased customer loyalty

Poor user experience and decreased customer loyalty are interrelated issues that result from the use of outdated technology. High churn rates, where customers are leaving the business, might be a key indicator of a problem with the legacy software in use. The failure of servers and other technical issues that prevent users from accessing the software or completing tasks is not only frustrating. It can lead to a lack of confidence in the business. In the long run, this could make customers less loyal because they will turn to competitors whose products are more reliable and easy to use.

Legacy software can also negatively impact the user experience in other ways. For example, if the software is slow or unresponsive or if it doesn't offer the functionality that users need, this can lead to dissatisfaction and a decrease in customer loyalty. The inability to access or use the software from different devices or the lack of integration with other systems and tools can also contribute to a poor user experience.

Impact on brand image

And the final red flag. In contrast to the previous ones, it might be too late if you notice it. We'll cover only one aspect of how legacy software might impact your brand's image. But this impact is devastating. Data breaches caused by legacy software or software that hasn't received necessary security updates on time can devastate a brand's image. Two prominent examples are Equifax and Marriott. Despite their long histories of serving millions of customers, both companies suffered from significant data breaches that had far-reaching consequences for their brand images.

In the case of Equifax, the company experienced a massive data breach in 2017 that exposed the personal and financial information of millions of customers, including names, addresses, social security numbers, birth dates, and more. The breach resulted from a vulnerability in Equifax's website software that the company neglected to patch on time, which had a significant negative impact on customers' trust in the company and the company's reputation.

Similarly, Marriott suffered a data breach in 2018 that exposed the personal information of 500 million customers, including names, addresses, phone numbers, and email addresses. The breach was traced back to outdated database software and legacy IT infrastructure at Starwood hotels, a brand that Marriott acquired in 2016. The breach had been going on for four years and was only discovered after Marriott acquired Starwood. Because of this, customers lost trust in Marriott, which hurt the company's brand image in a big way.

These examples serve as a reminder that even well-established companies can be impacted by data breaches, which can significantly impact their brand image. Companies must take cybersecurity seriously and implement proper measures to protect their customers' personal and financial information or risk damaging their reputation and losing customer trust.


In conclusion, our study has highlighted the 22 alarming signs that indicate it's time to upgrade your legacy software. It's clear that legacy software can have a significant impact on your business. System performance issues such as slow speed and frequent crashes can hamper productivity and negatively affect the user experience. Technical limitations, such as a lack of support from the vendor and difficulty adding new features, can limit the growth and flexibility of your business. Security and compliance risks, such as vulnerabilities to cyber threats and non-compliance with regulations, can leave your business exposed to potential data breaches and financial losses. The high maintenance and support costs, including lost opportunities due to outdated technology and the high cost of downtime, can drain your budget. Finally, poor user experiences, such as low user satisfaction, decreased customer loyalty, and a negative impact on brand image, can harm your reputation and make it more challenging to retain customers.

It's crucial to regularly assess the technology landscape and keep an eye out for these warning signs to ensure your software remains current and secure. At VP Software, we have a proven track record of modernizing legacy software in different ways, and we can offer you a free consultation to help you decide how to upgrade your software.

With the right approach, modernizing legacy software can be an affordable and beneficial process that delivers real results for your business. So don't hesitate to reach out to us to learn more and take advantage of our expertise and experience in this area.

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