Core modernisation is critical for businesses striving to remain competitive in today’s rapidly evolving digital landscape. Without upgrading legacy systems and integrating advanced technologies, organisations’ ability to reap the rewards of such advances will be limited. Modern core systems enable seamless scalability, faster time to market and better decision-making through advanced analytics and real-time insights, allowing businesses to improve operational efficiency, increase agility and deliver more nuanced customer experiences.
In short, core modernisation provides the foundation for thriving in the era of AI, ensuring businesses are adaptable to future challenges. We spoke to our Chief Strategy Officer, Scott Harkey, and Global SVP, Lorand Gabos-Szoverdi, to dig deeper on why core modernisation is essential for sustained growth and resilience.
What are the most important drivers that make core modernisation a priority for businesses today and why?
Scott: We are in a new era where businesses are having to respond faster than ever to new technologies, ways of working and customer expectations. For many, their ability to provide the needed speed, agility and adaptability is restricted due to legacy systems that are expensive to update and carry a lot of risk when making changes. Core modernisation involves updating these core systems to modern technology and integrations that allow for businesses to launch new products and features, integrate new partners and build richer customer experiences.
Lorand: Just as Scott said, agility is a primary factor that makes core modernisation a necessity. We live in a world where contexts change rapidly, where companies need to respond to changes in the market and drive changes themselves. Even if you create the situational awareness to respond to the changes, your legacy core systems prohibit executing upon them. You need flexible and adaptable systems, which most legacy core systems are not.
Scott, what are the top strategic challenges businesses experience with core modernisation?
Scott: The number one challenge we see is how businesses de-risk modernisation. The reasons many have not updated their core systems is because these systems are often what are driving key processes within the business. If the modernisation fails or if new features are put on hold until the modernisation is complete, then it can cause serious business impact, and many companies aren’t willing to take that risk.
Another key risk is trying to determine when the 'right' time for modernisation is. Many businesses worry that the pace of technology change is so great that if they make a change now they may risk leveraging technology that becomes outdated within a few years.
One of the key benefits of our core modernisation services is the set of capabilities we bring to the table to de-risk the effort. We have capabilities, including some proprietary IP, that allow us to map out both the current state and future state of the client’s technology and business processes. Using these capabilities, we can create traceability into the modernisation process and help avoid negative business impacts as well as the best sequence of tasks.
Lorand, how can a business’s IT infrastructure be adapted to support modernisation efforts?
Lorand: Just as in the case of legacy systems, an outdated infrastructure will be a blocker in developing new capabilities or using third-party services that act as enablers for new opportunities. As a modern company, you have to provide the right foundations for those new systems to run on. Using cloud services or infrastructure that support composable architectures and serverless environments – you need to be able to use the right solution for each challenge and need.
What is the best approach for migrating legacy systems without disrupting business operations, productivity and morale?
Scott: As I mentioned before, we often start with a mapping exercise that shows exactly where the business process and technical risk sits within the existing systems. This allows us to isolate part of the customer infrastructure and sequence modernisation activities in a way that avoids disrupting key business activities. This also increases the rate of success in actually making it through the modernisation and gives employees confidence in the outcome. That always seems to help with morale.
Lorand: Using the right mix of execution models and accelerators supported by subject matter experts and driven by fit-for-purpose strategies. A modernisation needs a specific execution model, one that we have developed, supported by the collection of accelerators we can choose from depending on the case. The context also dictates what the right strategy is and what the phases and milestones that you want to achieve. We have a continuous value delivery driven modernisation approach, where we are always guided by the value (to be) delivered. It should be frequent/continuous, timely and based on stable plateaus.
How can businesses ensure that modernisation efforts align with business needs rather than simply technical?
Scott: One of the key objectives when starting on a transformation journey is to ensure you have clearly defined the desired outcome. It sounds obvious but can often be missed or can be a technical outcome as opposed to a business outcome. There are many different approaches to this, but I like thinking of the end customer and the experience you are trying to create for them or the 'job to be done'. By anchoring on the customer, you can ensure you make changes that are ultimately going to drive business success and not just technical proficiency.
Lorand: We always work to ensure that there is a valid business reason necessitating transformation. Sometimes these business reasons can have a dominating technical aspect to them, but the business outcome should be the driver. The best way to achieve that is to define the need and value chain changes you need to adapt to.
Lorand, how can modern core systems be designed to adapt to future needs?
Lorand: Designs are always subject to trade-offs. You trade-off performance against security, flexibility against complexity and so on. With each case you have to define which are the essential quality attributes for you. Adapting to future needs means having flexibility and changeability as essential attributes. Building them into the modernisation strategy ensures long-term capability of the system to adapt to future needs.
How would you characterise Endava’s journey in core modernisation and how have we been helping our customers to embrace this new era?
Scott: We have helped our customers with their digital transformation journeys for over two decades and much of that work has been in building digital experiences that sit on our clients’ core systems. More recently, we are finding that it’s no longer sufficient to build these experience layers around the edges of core systems. A whole new set of capabilities within the core are needed to empower the speed of change that most businesses are faced with. We still build lots of experiences, integrate lots of services and help our customers on their digital journey; however, we are finding that our enhanced capabilities to help organisations de-risk their core modernisation are providing higher value to our customers than ever before.
Discover more core modernisation insights from our experts, or dive into how we actively help our customers realise the importance of core modernisation to unlock new opportunities.