While many equate the risks of sun-setting legacy ERP applications with the rigors of implementing new applications, the loss of key personnel prior to an ERP migration could also put an organization in even bigger peril. Many companies have been operating on the same core set of business applications for 15 to 20 years and there is usually tremendous amounts of knowledge held be one or two very key people who may be quickly approaching retirement age.
Millions of Baby Boomer employees are expected to exit the workforce in the next 20 years. AARP estimates that 10,000 Baby Boomers will reach age 65 every day during the next two decades. This poses heightened risks for organizations operating a homegrown system with an aging IT team or person.
Using a homegrown solution can raise numerous challenges—particularly for a smaller organization. For example, what happens if your IT director is no longer with the company? Or the programmers who developed the original application move on to other projects, other jobs, or retirement? You may be coding in yesterday’s technology and may find it hard to replace resources that are familiar with and competent in those environments.
Who will take over development of the current system and how will they get up to speed on the application? Will the loss of key people make any migration to new technology extremely rocky?
Legacy vs. Modern Technology- Reasons to Move
- Batch System vs. Real-Time – Older custom systems are usually updated via batches (daily or monthly), and it is extremely difficult to rewrite all the logic into a 100 percent real-time system. Batch systems also typically have lengthy day-end, month-end, and yearend processes.
- Limited Transactional History – Data is purged every few months. This forces you to refer back to paper reports or information that is stored in a separate document imaging system.
- User-Friendly Interface – Homegrown systems typically lack the ability for end users to customize the interface and information to their specific business needs, make them more efficient, and view data that is most relevant to their job function.
- Older Hardware Platform – Many times companies are forced to move exclusively on the reliability or supportability of their hardware platform.
- Information Access – It can be quite challenging for company employees to get the data they need directly from a homegrown solution.
- Multiple Systems – Many times legacy systems are interfaced and integrated to multiple applications that causes additional support headaches and restricts the ability to upgrade to more recent technology.
- Fragmented Processes – The focus of homegrown solutions is often on the features and not on best business process flows, so they usually don’t have standard operating procedures and the procedures have evolved around the code.
Tribal Knowledge-Risk of Lost Employees
- Lack of Documentation – Most older legacy applications were not properly documented making it increasingly difficult to upgrade or integrate to new applications
- Hiring Employees -It is also difficult to hire employees when companies are utilizing very old technologies making it difficult or extremely expensive to replace lost employees.
- Tribal Knowledge – Many times an older legacy system is held together by “workarounds” and ancillary informal systems known by very few. Replacing this “Tribal Knowledge” is next to impossible.
Companies must plan for the eventual retirement of all key employees and the potential risks of losing a key IT Manager could be catastrophic. Because there is such a large concentration of knowledge of key information, companies need to proactively consider migration strategies for both their applications as well as their key IT personnel. Failure to do so could subject an organization to unnecessary risks.