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Why Modernization Is Not Just A Technology Problem

Technology Modernization

Learn why modernization is not just a technology problem. 

What’s the first word you think of when you think of modernization challenges?

We’re going to assume technology is what first came to mind.

The overwhelming majority will have the same response as technology and modernization usually go hand-in-hand. Unnecessary costs and inefficiencies caused by dated technologies are generally the driving force for modernization. With digital transformation investment expected to nearly double by 2023, leveraging a holistic, collaborative approach is essential to overcome more than just technological challenges.

Most organizations focus on the technology aspect, often overlooking other important perspectives during a legacy modernization initiative. The reality is that the world of technology is fragmented across multiple areas that encompass people, strategy, and commercial perspectives. Addressing these potential non-technical barriers upfront will help mitigate potential roadblocks, enable a clear understanding of overall objectives, and set your organization up for success.

Strategic Priorities Shifting During Budget Cycles

Roadblock: We need to invest in a modern platform, but other strategic priorities have superseded it during the budgeting cycle for many years.

Best Route: There will always be competing interests and other initiatives that could take precedence. This is where building the right business case and getting buy-in on a shared vision is essential to think beyond the short-term. The key here is to show the value that modernization can deliver, and not just the buzzwords – lower costs or increase productivity, but emphasize the linkage of customer value creation. Making large multi-year commitments tied to value creation at every stage is essential to making your modernization initiative a priority.

Commercial Risks of Changing Customer-Facing Platforms

Roadblock: We have postponed major upgrades as they increase revenue risks when customers bid out contracts.

Best Route: Legacy modernization traditionally starts with customer-facing processes and services, which amplifies competitive threats. These same commercial risks often can be the catalyst to justify the large-scale effort necessary to engage in digital transformations. No matter where you are in the modernization journey, the last person anyone wants to disrupt is the customer. This is why analyzing your top customers and asking for their feedback will help you prioritize your focus. By understanding your customer, you’ll have better insights into potential risks and be better equipped to identify the right requirements. Additionally, consider offering incentives for customers to migrate (new features, pricing, etc.). Developing the proper customer roadmap can help soften the transition’s magnitude and strengthen your customer relationships’ longevity.

Transition from Legacy to Digital Engineering Skills and Processes

Roadblock: Replacing a mainframe-based core platform is like doing open-heart surgery without surgeons, as most of the technical talent has long retired.

Best Route: No one wants to head to the World Series or Super Bowl without their star players. Acknowledging any talent bottlenecks or lack of resources upfront and getting a plan in place to fill those gaps will help you be ready when you need them. There are plenty of options to source talented resources by leveraging an external partner to supply the expertise. The most successful partnerships are made by those who excel at design thinking, rapid product innovation, and deep product engineering methods and tools.

Cultural Practices of the Business Ecosystem

Roadblock: Multiple departments rarely want to collectively commit to eliminating legacy platforms at the same moment in time.

Best Route: It’s come to be common knowledge that people fear change, but people also tend to believe that how they are doing a particular job or task is the right way to do it (so why change). This is where embracing organizational change management is fundamental to adoption and getting your colleagues on board with modernized processes and new ways of thinking. The key – each department impacted needs to be convinced it’s a priority for them and take the fear out of change. With the pandemic forcing change, it’s a good time for stakeholders to agree to work differently and capture a digital ecosystem’s full benefits.

To learn more about removing roadblocks from your legacy modernization journey and why modernization is more than just a technology problem, contact us today.