Like someone who balks at throwing out a threadbare T-shirt unfit to wear in public, many organizations are slow,  or even hesitant, to upgrade their legacy system technology.

The reasons for this can vary from the fact that all of their systems are running on it,  to the time and expense of modernization, to a more watered-down rationale: “If it isn’t broken, why fix it?”

In a world characterized by exponential change, that can prove to be a serious misstep. Sticking with outdated technology of all sorts can be exceedingly expensive, especially if you look beyond financial parameters. 

The Risks of Staying the Legacy System Course

Although many organizations have plenty of reasons why they “can’t” update their outdated technology, or why they are moving so slowly, the risks of failing to do so are increasingly filling newspaper columns and the Internet. In another blog, I noted how outdated technology grounded thousands of aircraft for both Southwest and Delta Airlines.

In a more recent episode, British bank Tesco shut down online banking in early November after 40,000 accounts were compromised, with half of them being hit by fraudulent transactions by hackers. Andrew Tschonev, technical specialist at security firm Darktrace, was blunt in his assessment that outdated security measures were a primary reason for the breach. “With attackers targeting everyone and anyone, today’s businesses cannot safely assume that it won’t happen to them,” he said.

More Than Just Bad P.R.

Obviously, high-profile incidents like the ones I just cited don’t make for the most glowing types of headlines. But there are even more reasons not to turn a blind eye to outdated, potentially destructive, legacy technology:

  • Sticking with the old is far more expensive than you might assume. No one will argue that revamping outdated technology can be an expensive proposition. But so, too, can sticking with systems whose best days have come and gone. Here’s evidence: A study several years ago by Unisys and MeriTalk reported that the federal government spends more than $35 billion trying to maintain legacy systems—and even with that amount of money, efforts at modernization we’re still running behind.
  • You run the risk of losing customers. No matter what industry your organization may be in, your customers will lose confidence if they see you are clinging to the past. Offering outdated solutions and ideas that derive from equally outdated technology may only prompt customers to look to others who understand the future and where they are going better than you do.
  • You run the risk of unreliability. Many organizations that hold on to legacy systems attribute the decision to the “fact” that the systems still work. That may or may not be the case; but consider what may happen if or when something goes wrong. For one thing, as the airline example underscores, having outdated technology in place only boosts the risk that something eventually is going to misfire (in the case of Delta’s shutdown, it was discovered that some 300 of its 7,000 data center components had not been configured correctly).  And, should something go amiss, older technology may simply not be bolstered by adequate vendor support as manufacturers turn their attention to newer products.
  • The people who understand the technology are retiring. Younger tech talent, the ones replacing your retiring Baby Boomers, have little interest in learning how to maintain and fix outdated technology.

It Hurts Your Brand and Looks Bad To The Public

As I discussed earlier, a high-profile technology failure that derives from legacy systems simply doesn’t look good to the public at large—an issue made ever more prevalent with the exponential growth of social media.

But, in working with organizations of all sizes and types, I emphasize that leaders also need to be aware of the message they’re sending to every one of their employees. Not only will younger employees who are comfortable with technology react negatively to having to cope with the limitations and headaches that outdated systems and networks can foster, but such annoyances may prompt them to begin looking for new employers who are more willing to invest in adequate, up-to-date infrastructure.

As I emphasize in my Anticipatory Organization Model, in a world of technology-driven exponential change, saying yes to upgrading can be expensive. But saying no to updating outdated technology can be even more costly.

Daniel Burrus has been trusted by leaders from Fortune 500 Companies, the Pentagon and Heads of State  to deliver a message that accurately predict future trends and identify game chaning opportunities before the competition. See some of Daniel’s Recent Keynote Speeches below: