Are Legacy Apps the Last Frontier for AI Adoption?
- By CDOTrends editors
- July 10, 2023
In the race to harness the power of advanced technologies like artificial intelligence (AI), global IT organizations are hitting a significant roadblock: the slow pace of modernizing critical applications. Recent research reveals the crucial correlation between the modernization of legacy applications such as customer resource management (CRM), enterprise resource planning (ERP), and human resources (HR) systems and the successful deployment of AI.
The study, conducted by Rackspace Technology in partnership with AWS, is based on the responses from 1,420 IT leaders worldwide. A staggering 78% of participants from Asia Pacific and Japan (APJ) confessed that they would reap the benefits of AI with the much-needed modernization of their legacy apps and data. However, the sluggishness in updating these infrastructures persists, potentially hindering the AI-powered future.
"It's revealing that even as they navigate the cloud journey, organizations find the modernization of the most critical apps daunting. These apps are both the most important and challenging to modernize," said Jeff DeVerter, the chief technology evangelist at Rackspace Technology. "It's reassuring to see leaders understand that app modernization is key to capitalizing on cutting-edge technologies. The fear of missing out on AI might finally spur organizations to modernize their core systems."
Although IT organizations in APJ recognize the need for modernization, obstacles like limited resources and resistance to change often derail these initiatives. Hemanta Banerjee, vice president of public cloud data services at Rackspace Technology, points out that partnering with solutions providers like Rackspace Technology can help these organizations navigate multi and hybrid cloud environments, enhance customer service, build loyalty, and explore new revenue streams through innovation.
Interestingly, the study reveals that modernization initiatives are spearheaded mainly by IT departments (69%), and executive leadership/C-suite (45%), but fewer organizations utilize cross-functional teams, tech vendors, or external consultants in these efforts.
The primary anticipated outcomes of modernization are increased efficiency (31%), cost savings (28%), and the adoption of advanced technologies like AI (27%). Furthermore, modernization has been shown to improve data management, integration, quality, and cost.
However, the path to modernization is fraught with obstacles. Limited resources (27%), cultures resistant to change (20%), integration challenges (17%), lack of senior buy-in (10%), unclear roadmaps (9%), and communication issues among stakeholders (8%) are some of the chief hurdles.
The failure to modernize legacy apps and data systems can have serious repercussions, such as integration problems (32%), increased costs (30%), lack of innovation (26%), poor security (25%), and the inability to adopt advanced technologies (23%). This study underscores the urgent need for IT organizations to prioritize the modernization of their legacy systems to fully leverage the potential of AI and other advanced technologies.
Image credit: iStockphoto/Martina Birnbaum