Having a legacy can be a wonderful thing when it comes to culture, wills, and people, but when it comes to IT (Information Technology). It is a deal breaker that becomes increasingly painful over time. For most industries today, including asset finance, IT is an essential component and the foundation on which entire businesses run.
As a result of decades of underinvestment, poor maintenance, and the instinct to ‘leave things alone,’ critical infrastructure gaps can result in unprecedented operational breakdowns. As a result, companies scrambled to stay viable following the global pandemic that ravaged the global economy.
Modern CIOs (Chief Information Officers) have been tasked with aligning IT investments with business objectives. Because of the sudden rush towards modernization and digitization. However, while research suggests that more than half (57%) of enterprises’ IT budgets is spent on maintenance and support.
Application modernization is becoming increasingly important. Legacy systems hold companies back frequently. The costs and productivity impact are enormous—manual processes, unsupported systems, poor security, limited innovation, and poor user experience.
If you are struggling with legacy systems, you may be able to identify these hidden pitfalls.
Integration and upgrades are a pain
It is crucial to become digital and evolves to address dynamic business challenges at a time when digital technology is transforming ways of working. But if your organization still relies on legacy IT systems, it will face significant challenges.
Key reason many digital transformation initiatives fail is the difficulty of integrating disparate legacy systems with the latest technology (think cloud, SaaS ). With outdated applications and systems, mobile compatibility is almost non-existent.
In addition, poor integration invariably leads to data silos within an organization, preventing different departments from accessing the data they need. As businesses grow, IT systems need to be able to integrate the latest software and systems for better performance and be compatible with business growth.
You are accruing technical debt.
Managing large, outdated asset finance platforms and architecture can be a daunting task at any given moment. It eats into your IT budget and has several overheads and hidden costs that make your company less successful. Even though you may save money in the short term by using a band-aid, the long-term impact will be substantial.
The older your IT infrastructure, the less common the knowledge required to operate and maintain it. Finding the right people with the right skills can be challenging. A company’s outdated asset leasing software also negatively impacts its sustainability goals, does not generate new revenue streams, and accumulated massive technical debt. Which adversely impacts its sustainability goals.
You are unable to deliver a great customer experience
A robust tech strategy focuses on enhancing processes and capabilities to remain competitive. However, legacy systems are often inflexible and have difficulty adapting to changing market conditions. If you want to stay competitive, your employees will need sophisticated asset finance platform. And digital tools to meet the customer expectations of a digital enterprise.
It is impossible for your current system to meet the expectations of employees. And customers in today’s world of advanced user interfaces. Which is like what they expect from their smartphones and laptops. If your system is archaic, you will fall behind quickly, and your user experience will be degrade.
Weary of IT (in)security?
As a result of legacy systems, companies are vulnerable to cyber-attacks. This is not surprising since they were designed before cyberattacks became sophisticated. Despite the issue’s importance, many organizations have not paid attention to it.
It is possible that you will be a prime target if your business uses unsupported legacy systems. So you might add to these statistics if you use stop-gap fixes. Security best practices like single-sign-on, multifactor authentication. And role-based access are not accommodate by outdated infrastructure.
In recent years, organizations have become increasingly interested in migrating to a cloud-based environment because of its strong security capabilities.
Keeping up with productivity-boosting tech trends is difficult
The advancement of technology has led to the development of new digital solutions. That enhance efficiency by automating processes, analyzing data, delivering actionable insights, and utilizing predictive analytics. As a result of tech megatrends such as artificial intelligence, machine learning. The Internet of Things, robotic process automation, chatbots, cloud computing, and more, your organization should be able to generate revenue.
It becomes more challenging when legacy infrastructure is involve. In addition to making integration with digital systems near-impossible, legacy architecture creates technology and data silos within an organization. And prevents it from utilizing digital technology to its fullest extent.
Modernizing: It is not too late with the right approach and tools
The challenges of modernization seem daunting. But the situation is not as bad as it seems. A survey of the industry found that 89% of companies are adopting or intending to adopt a digital-first business strategy, with $1.8 trillion projected in digital transformation spending by 2025. The first step is to acknowledge that you have a problem. Once that hurdle has been cross. It is only a matter of time. The urgency of ensuring digitalization is set.
Based on business priorities, asset leasing businesses can take a more iterative and incremental approach to modernization with the right strategy, tools, and resources. To start your modernization journey in the right direction, you need a three-pronged framework to help you determine. If you want to extend, refactor, or rebuild existing applications.
With it, you will be able to ensure that business disruption is minimize. And that you will be able to drive digital transformation in a way that strikes a balance between your priorities of quick-win innovation and core modernization.
Asset finance and leasing institutions face a complex array of challenges today. Including increased consumer expectations, the threat of innovators disrupting the market, and customer behavior changes due to the COVID pandemic.
A legacy system hinders financial institutions from providing safe and satisfying customer experiences. As a result, they are fighting these challenges with one hand tied behind their backs. The financial industry must at least keep pace with its technologically advanced competitors with cloud-native asset leasing software.
Headquartere in Philadelphia, USA, Odessa is a software company exclusively focuse in the leasing industry. The Odessa Platform powers a diverse customer base globally, providing end-to-end, extensible solutions for lease and loan origination and portfolio management.
Odessa facilitates business agility through rich feature sets including low-code development, test automation, reporting. And business intelligence to ensure organizations can more effectively align business and IT objectives. Learn more at www.odessainc.com