Legacy System Modernization: Make it Better Than New

The advantages of upgrading vs. implementing new

If you’re struggling with an outdated system, you might think the only solution is to purchase and implement a completely new system. This is not only expensive, but it also may not addresses the root causes of your current problems. Even if you have the budget to purchase a new system, this introduces new challenges you may not have anticipated:

• Lengthy procurement and implementation process: Depending on the nature of your organization, you may have to solicit bids from multiple vendors before deciding on a new system. Even if you can quickly select a new system, implementing and adopting it across your organization can take a year or more.
• Disruption to workflow: While your legacy system may be not be meeting all your needs, it’s what your people know. Even a well-planned transition from the legacy system to a new one can cause a slowdown in work, as key players on your team will need to be dedicated to the project and will need retraining on how to perform their jobs with the new system.
• New risk: Introducing a completely new system to your organization means everyone starts from scratch. Remember how many (understandable) mistakes you made during the first few weeks of your job? Imagine the potential mistakes made by an entire organization that’s adopting a new system at the same time.

Legacy system modernization in action: a client story

The issue

A mid-sized state retirement system was experiencing issues with their legacy pension administration system, the support and maintenance they received for that system, and the uncertainty surrounding the ability to expand the tools available to users and members. The challenges the state was experiencing was causing them to think that they needed to replace the system.

This issue weighed heavily on the management and staff and so they engaged Segal to assess the system and provide a recommendation to keep and enhance the system, or go out to bid for an entirely new system.

Our solution

We performed an analysis which

• Assessed the current situation to understand and document the issues facing the state with their technology, systems, how those systems are managed and maintained, and business processes
• Evaluated and scored the state’s system against our best practices and their industry peers; and determined recommendations for areas of process and technology improvements
• Designed a modernization roadmap that provided alternatives for the state to consider and ultimately defined a path forward including projected timeframes, associated costs and resource allocations
• Shored up their project and vendor management practices.

The results

Because of our objective assessment of the state’s needs and our knowledge of the vendor market, we recommended they enhance their current system vs. going out to bid for a new system. We are currently assisting the state in implementing the modernization enhancements, which is projected to save them millions of dollars (compared to replacing the solution) and allow them to begin seeing improvements in functionality incrementally, rather than waiting for a multi-year project to complete. This effort has allowed them to maintain an important relationship with the legacy system vendor.