Escape the Shackles of Your Legacy Data Platform
What does it truly mean to upgrade your technology infrastructure or change platforms? When is it worth the effort? And what does a successful transition look like?
Legacy and point systems were commonly designed to handle specific datasets and functions. To avoid significant investment in upgrades, organizations commonly resorted to layering new solutions on top of old ones, creating a tangled network of systems and processes and inhibiting teams from managing information efficiently. Research estimates 40% of enterprise data management platforms are still legacy.1
While the time and cost savings may have made sense at one point, technology leaders are now coming head-to-head with the limitations of their current systems. Constraints — such as limited agility or minimal customization options — can lead to costly upgrades and operational inefficiencies.
However, many tech leaders find their firm paralyzed by fear of change, opting to patch infrastructure with temporary fixes rather than embracing a full transformation.
Change can be hard but don’t let trepidation of implementations prevent you from moving systems. To get the most value, firms must be ready to integrate fit-for-purpose systems with accessible data.
5 signs your systems need an upgrade
Fast-moving markets, changing regulations, sustainability expectations, and the role of artificial intelligence are all likely to feature in future financial ecosystems. Data-led processes supported by modern financial data platforms will be critical to staying competitive. Yet, underinvestment in core applications may leave firms unequipped to integrate the advanced technologies imperative to meet shifting industry expectations.
To embrace the opportunities of digital transformation, your firm must understand the degree to which key factors impact your processes, products, and people.
Consider these factors when evaluating your systems:
- Elevated security risks
- Hampered digital modernization
- Inconsistent or declining performance
- Integration compatibility
- Decentralized data silos
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How can your firm overcome legacy data challenges?
Cloud-based, software-as-a-service (SaaS) platforms offer a unified approach to automating the investment lifecycle. With opportunities to lower total cost of ownership, scale business, and improve agility, organizations can streamline operations and adapt to the changing landscape. The transition to modern financial data platforms allows firms to address the challenges of data aggregation and reporting. Modern systems also foster greater agility.
Cloud-based platforms can free data from silos so that teams across your firm can access the information they need to inform decision-making. When data is centrally hosted, managed, and distributed, you gain confidence that all teams are working from the same “true” source of data. Modern platforms can also offer the benefit of self-service tools that enable users to create and access the applications that drive performance.
SaaS lessens the need for organizations to maintain and run applications on their own computers or in their own data centers. Using a cloud-based platform eliminates the expense of acquiring hardware, creating, and setting up IT infrastructure and maintenance. SaaS platforms also help eliminate the need for software licensing, installation, and support. With a SaaS partner, firms can skip the costly and oft-painstaking process of periodic upgrades to new systems.
There are other benefits, including:
- More predictable costs
- Scalable usage
- Up-to-date technology
- Accessibility and persistence
- Customization and integration capabilities
Planning for a successful migration
It is important to recognize and address your firm’s hesitation when considering migration to a cloud platform. Among the concerns may be reluctance to place sensitive data into cloud environments, a lack of clarity on what’s possible within a new system, potentially higher operating costs, and risk of outages.
While careful planning and expertise are required to ensure the right data is migrated correctly, the benefits that can be realized by migrating data to the cloud from a legacy platform are numerous.
To execute a successful migration, here are key considerations to evaluate as you build your plan:
- Create a detailed migration plan that outlines the sequence of migration activities, timelines, resource allocation, and potential risks.
- Prioritize applications for migration based on criticality, complexity, and potential business impact.
- Consider a phased approach, migrating applications in groups or stages, starting with low-risk or non-critical systems.
- Discuss and align on scope and procedure for scope changes during the project.
- Anticipate risks and have a plan of action in place.
- Keep an open mind and an agile approach so that you’re ready to resolve issues if and when they arise.
- Build and maintain a positive relationship with the vendor project team to help facilitate smooth resolutions.
- Map out a data migration strategy to avoid data loss, formatting problems, and data quality issues.
Achieving better client outcomes
Despite reservations some firms may express around hosting data in a cloud environment, investing in new technology, or simply taking the time to integrate systems, tech leaders understand the advantage a unified data platform can deliver. The more difficult task may be in shifting the conversation so that tech leaders are ready to convey the value that leveraging sophisticated and unified technology can create.
Ultimately, greater efficiencies and smarter use of data can only help to reduce operational costs, increase security, and ultimately lead to better results for clients. Financial organizations ready to take on digital transformation are strategically positioned to support new investment products, meet rising customer demands, and deliver scalable, superior customer experiences. To enhance efficiency and foster growth, investment firms must adopt a broader perspective beyond managing technology debt in a defensive manner.
To learn more about the key factors your organization should consider as you navigate system migrations, read our best practice guide, Determining a Migration Path to Modern Technology Platforms.
Sources:
1 2022 Global Investment Operations Priorities, InvestOps, 2022
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