Legacy systems—any outdated computer or technology system that doesn’t update regularly or integrate well with current technology—are a hot topic for many reasons. Cost is perhaps the most often-cited complaint with these older systems. One recent study on cybersecurity breaches—often related to legacy system utilization—cited an annual cost of $4.45 million!
You may look at these numbers with some skepticism, however. Maybe your IT department doesn’t have even a fraction of that budget for the whole department, let alone for maintaining legacy systems. Maybe modernization sounds expensive. Maybe you just like your legacy systems.
Regardless of your reason avoiding modernizing—you’re losing money by doing so. We surveyed IT workers in many industries to learn just how much time, money, and resources are being put into keeping legacy systems running year after year. And according to our respondents, well, it’s a lot.
- Legacy systems cost IT departments on average nearly $40,000 to maintain each year.
- More than 75% of technology professionals are concerned about security vulnerabilities in legacy systems.
- More than 40% of technology professionals use AWS and Google Cloud Platform.
- 44% of technology professionals rate difficulty integrating with newer technologies as a high cost of legacy systems.
According to our respondents, legacy systems cost teams like yours nearly $40,000 to maintain each year—and that’s just on average. IT workers from all industries shared that they lose, on average, a staggering 17 hours per week just maintaining these legacy systems. That’s nearly half the workweek. Resolving this issue alone could nearly double productivity across IT teams in the long run.
If we break this down further, we can see some interesting trends per industry. While the average labor cost per worker annually related to maintaining legacy systems is $39,000, further breakdowns show an even higher cost in manufacturing and energy/utilities ($53,429) and the public sector ($42,190).
That’s a lot of money left on the table. In fact, these numbers are likely why 33.54% of respondents cited increased maintenance costs as a significant impact of legacy systems on their industry. If you’re in any one of these industries, it may be time to consider investing in modern solutions, whether that looks like cutting-edge AI technology, a migration to the cloud, or something else entirely.
Put simply: Not modernizing may be costing you more money than you think.
So, we know that legacy systems are expensive. But you may still be weighing the pros and cons, and maybe the maintenance cost alone isn’t enough to convince you to step away from legacy systems entirely. If that’s the case, be aware that there are other reasons to invest in more up-to-date technologies—notably, the security of your entire organization.
According to our research, security is a top issue for IT workers across industries—but nowhere is it more crucial than in technology. In technology, a staggering 77.12% of IT workers are concerned about security vulnerabilities in legacy systems. Manufacturing, energy/utilities, and social services shared similar concerns, with over 74% concerned about security.
If this data alone isn’t enough to convince you that prompt action is necessary to address the security threats of older systems—the story doesn’t stop there.
In the technology sector, 43.69% of IT workers actually rated security vulnerabilities as the highest cost of continuing to utilize legacy systems. For these individuals, the danger of a breach (and the need for data privacy) is an even bigger issue than the maintenance costs we illustrated a moment ago. This demonstrates that updating older systems should be prioritized from both a financial and security perspective.
Finally, we asked respondents to share their thoughts on the greatest hazards (and subsequent costs) of not modernizing their legacy systems. General responses included difficulty integrating with newer technologies (39.38%), security vulnerabilities/security risks (35.08%), and increased maintenance costs (33.54%). All these reasons are some of the most familiar talking points in the conversation around modernization.
Delving further into these results by industry, however, surfaced some unique data. In the public sector, for example, 52.63% of professionals rated increased maintenance costs as a high cost of legacy systems. In technology, more than 44% cited difficulty integrating with newer technologies as the biggest issue. Many of the same themes are reflected throughout, but prioritized problems vary by industry.
As this chart shows, despite the range of issues with legacy systems, there are some trends that transcend industries. IT workers from technology to manufacturing report difficulty with integrations as a major issue with legacy systems. So, if you haven’t checked on your own team’s integrations recently, it may be time to do so.
ServiceNow's Integration Hub offers a wise range of integration capabilities that can make connecting your applications easier. If you're part of the 39.38% struggling with integrations, explore ServiceNow's integrations to see how we can help you connect and automate systems across your enterprise.
While there are many takeaways one could draw from this data—such as “legacy systems are expensive” —we’d like to point to a few key observations. We saw these themes repeated throughout industries that point to action items for folks in tech who want to stay ahead of the game.
- Security issues: The security of legacy systems is a primary concern, regardless of industry. Modernization can help prevent the future costs of security issues caused by older systems. If you don’t have a plan for updating your tech stack regularly or at least evaluating where you may need to address security concerns, you may want to consider doing so soon.
- Maintenance costs: With 33.54% of all respondents citing increased maintenance costs as a drawback of legacy systems, allocating budget toward more sustainable, modern alternatives could cut down long-term expenses.
- Modern solutions: Many organizations already utilize cloud-based solutions like ServiceNow. With over 8,000 customers across all industries and organization sizes, ServiceNow's solution can help your team improve overall operational efficiency and reduce the risk of the aforementioned security issues.
If you’re looking for a good place to start determining action items for your team based on this data, we recommend starting with an ROI calculation exercise. Find out how much you spend on legacy systems annually and compare those numbers to the actual costs of a modernization process. How long would it take that new technology to pay for itself?
So, if you’re spending at least the average $40,000 annually on maintaining legacy systems, modernization sooner rather than later could save you more money than you think—and sooner than you think.
If you’re ready to start your modernization journey, check out ServiceNow Vault. From data privacy measures to platform encryption, this solution uses cutting-edge technology to keep your data safe.
