The Hidden Cost of Cutting Corners: Why IT Modernization isn’t Optional

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Today the word ‘modernization’ gets thrown around a lot – it has been on the lips of every CIO and CISO for years. In spite of that, most businesses today have more modernizing to do: according to one study, nearly 80% of U.S businesses are behind on IT transformation, depending on legacy equipment, software, and systems to run their organization. 

If you ask any business leader why they don’t invest in more advanced solutions, you will invariably get one of two answers: first, the cost of upgrading is too high – second, “why fix what isn’t broken?”. Old habits die hard and disrupting organizational workflows that have worked for more than a decade is even harder. 

But while this perspective is understandable, holding back on modernization always costs more in the long run, and it never works forever. In this article, we’ll explain why that’s the case using real examples from our clients. But first, let’s define what “modernization” even means. 

What is IT Modernization? 

Modernization can take many different forms between organizations and industries. For many, it means retiring legacy hardware and applications while moving towards the cloud; for others, it means consolidating different systems and workflows into a single solution. Examples of modernization include: 

  • Upgrading from old, proprietary software to a software-as-a-service (SaaS) solution that supports remote employees 
  • Switching from on-premise data storage to the cloud and eliminating server costs 
  • Using AI to automate time-consuming tasks and increase efficiency 
  • Using metrics to continually optimize your internal processes and select better tools  

Whatever form it takes, IT modernization is fundamentally about aligning technology with your business goals while continually iterating to improve internal processes. A company that embraces IT modernization brings their operations in line with industry standards and saves money along the way. 

The Cost of Cutting Corners 

In spite of the benefits, there is no denying that IT modernization comes with upfront costs. Aside from the price of investing in new hardware or software, integrating them requires changes that can ripple throughout an organization – changing one system can break another, leading to frustration and time-consuming adjustments. 

It’s not hard to understand why decision-makers put off modernization in the hopes of saving money in the short term. But the evidence that it costs more in the long run is overwhelming: while most organizations are behind on modernization, they are also spending more money on IT than ever before. And that’s not hard to explain when we consider the hidden cost of cutting corners. 

  1. Maintaining Legacy Systems

Legacy systems encompass any piece of software and hardware that a company maintains past manufacturer support, or after most competitors have moved onto alternatives. Keeping legacy systems can seem like an attractive option, especially when a company has built its workflows around them – but they ultimately cost money through their low reliability and failure rate. 

Not only do legacy systems require frequent maintenance – but a lack of support from manufacturers tends to mean that businesses will be paying for that maintenance out of pocket. Furthermore, legacy systems can put an organization in breach of various industry compliance standards (such as HIPAA or PCI), leading to steep fines in the event of a data breach. 

  1. Loss of Productivity

Cheap and legacy IT solutions are often behind alternatives in terms of functionality. By maintaining it, companies lose out on the ability to consolidate and streamline their business processes. While those processes may “work,” they involve redundant and time-consuming workflows that reduce productivity and efficiency at the same time. 

One MainSpring client who relied on legacy systems to connect with their international headquarters was struggling to stay connected to the Internet, delaying meetings and communication with partners. While upgrading to new Internet and telecommunication equipment was costly, it allowed them to collaborate reliably and get projects done on time. 

  1. Increased Security Vulnerabilities

Legacy systems often lack security controls that are standard in modern apps and hardware – and when they are no longer supported by the manufacturer, they will not receive timely updates to patch bugs, zero-days, and other vulnerabilities. This makes them an attack surface that cyber criminals can use to penetrate your organization. 

Older IoT devices are a notorious example – they often come with default passwords, lack multi-factor authentication, strong equipment or regular updates. This makes them a frequent target for cyberattacks. In today’s volatile cyber landscape, keeping these devices around is a bigger risk than ever before, with potential impacts ranging from data breaches to fines and loss of consumer trust. 

4. Reduced Scalability 

Legacy software and hardware tend to impose a hard limit on how fast a company can scale. As your business grows, your tech needs change, and IT systems must keep up – without the help of cloud-based systems, most small businesses struggle to rapidly onboard new clients and efficiently manage their resources.  

One MainSpring client who depended on an in-house data center was struggling with the ever-increasing cost of keeping server equipment cool. By moving the client’s data to the cloud, not only did we eliminate HVAC costs, but we also eliminated the cost of running and maintaining their server equipment.  

  1. Impact on Resilience

Today, modernized IT often means the difference between businesses who are prepared for disaster and those who are not. During the COVID pandemic, businesses who had the technology to support a mobile workforce were able to adapt quickly to lockdowns – similarly, businesses who adopted Software Bills of Material (SBOMs) were able to quickly patch the Log4Shell vulnerability that impacted millions of devices in December of 2021. 

To maintain revenue and resilience over the long term, businesses need the agility to adapt with changing circumstances. As the technology landscape rapidly develops, choosing the cheapest option – and maintaining legacy systems rather than replacing them – is a good way to fall behind in the face of an unexpected disaster. 

Why Modernization is Necessary 

With businesses losing hundreds of millions of dollars per year to technical debt, the opportunity cost of failing to modernize IT infrastructure is high. Modernization isn’t about investing in the latest technologies just because they are shiny and new – it’s about leveraging tech developments to drive your business goals. 

Ultimately, keeping your tech stack up to date leads to reduced long-term costs and increased performance; more importantly, it’s the only way to provide competitive customer experience and keep clients satisfied. Despite the short-term costs, every organization should be assessing its IT infrastructure based on business goals and continually change in order to meet them. 

MainSpring is your go-to source for IT strategy and support. Our award-winning managed services are handled by a diverse team of experts on the cutting edge of business technology, with decades of combined experience serving small-to-medium sized businesses. We adopt a proactive mindset to every customer, taking ownership of your results and working diligently to exceed your business needs. To learn more, contact us today. 

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