Legacy systems still pose a threat: the authenticity of ancient tech remains a concern

Outdated Legacy Software Pose Risks for U.S. Enterprises

Outdated legacy software systems in U.S. enterprises can pose significant challenges, impacting both security and customer experience. These systems, often riddled with unpatched vulnerabilities, are prime targets for cyberattacks and data breaches.

One notable example of this is the Marriott breach, which resulted in heavy fines and reputational damage. The breach highlighted the risks associated with outdated systems, as they frequently lack modern security safeguards, increasing exposure to threats and complicating compliance with evolving regulations such as HIPAA and CCPA.

From a customer experience perspective, legacy systems slow service delivery and hinder responsiveness, leading to poor client satisfaction and lost revenue opportunities. Their inability to quickly adapt to market changes or integrate with new technologies like AI and automation limits enterprises’ agility, causing delays in feature rollouts and making them less competitive.

Additional risks include high maintenance costs, inefficiencies due to manual processes and disconnected data, and shrinking pools of skilled developers for outdated programming languages. These factors can cause prolonged downtimes and service disruptions, further eroding customer trust.

Modern programmers find it difficult to understand software built in the last century, as the original creators are retiring or nearing retirement age. This presents a challenge for enterprises reliant on outdated systems, as they may struggle to find the necessary expertise to maintain and update their software.

New entrants can quickly acquire IT and COTS products to address the market, posing a threat to companies with outdated systems. For instance, recent entrants in the UK banking market, such as Metro Bank and Atom Bank, have utilised COTS IT solutions to get to market. This rapid adoption of modern technology allows newcomers to offer fast, on-demand data through simple, easy-to-use interfaces and multiple channels, which today's customers increasingly expect.

The 'if it's not broken, don't fix it' philosophy no longer applies to software systems. Outdated systems are not suitable for today's demanding, tech-savvy customer base. If companies do not update their outdated systems, they risk losing customers to competitors with up-to-date systems. This is particularly true for millennials, 71% of whom would rather go to the dentist than listen to their bank.

The brand equity built up over decades may not help companies with outdated systems, as customers are more likely to switch to competitors with updated systems. Even the state of New York was hacked in the past, and in 2014, some of the planet's biggest retailers compromised the security of their customers, including Home Depot, Sony, Target, and JP Morgan Chase.

Outdated legacy systems can jeopardize any enterprise's health, including vendors in sectors other than financial services. For example, the Royal Bank of Scotland in the UK has experienced multiple denials of service affecting millions of customers.

In the era of internet-connected devices, the three golden software rules for software security in the IoT have not been specified in the provided text. However, it is clear that modernization is critical to reducing risk and staying competitive. Apple offers a physical digital wallet, and Google is now an aggregator in the insurance industry, demonstrating the potential benefits of modern software systems.

In conclusion, relying on legacy software exposes U.S. enterprises to elevated cybersecurity risks, compliance challenges, operational inefficiencies, and degraded customer experiences. Modernization is therefore essential to reducing risk and staying competitive in today's fast-paced, tech-driven world.

[1] https://www.forbes.com/sites/forbestechcouncil/2019/08/27/why-it-is-critical-to-modernize-legacy-software/?sh=6e0f258b1a65 [2] https://www.informationweek.com/cloud/cloud-services/modernizing-legacy-apps-for-the-cloud/d/d-id/1332087 [3] https://www.forbes.com/sites/forbestechcouncil/2019/08/27/why-it-is-critical-to-modernize-legacy-software/?sh=6e0f258b1a65 [4] https://www.gartner.com/en/newsroom/press-releases/2019-08-27-gartner-survey-reveals-that-71-percent-of-millennials-would-rather-go-to-the-dentist-than-listen-to-their-bank [5] https://www.forbes.com/sites/forbestechcouncil/2019/08/27/why-it-is-critical-to-modernize-legacy-software/?sh=6e0f258b1a65