Nimesh Mehta likens decommissioning legacy techniques to occurring an archeological dig: There are techniques that also have a number of worth; it’s only a matter of unearthing them, taking out what isn’t wanted, and constructing new processes on prime.
“Our firm is about 176 years outdated, so we’ve obtained a number of legacy techniques which are older than me,” says Mehta, government vice chairman and chief data and technique officer at Nationwide Life Group. “We’ve additionally greater than quadrupled in measurement, which implies our techniques and our tech have to have the ability to scale with the enterprise.” This was the underlying motive to embark on a legacy transformation, he says, “as a result of our legacy platforms will not be going to have the ability to scale sooner or later.”
Mehta stresses that the decommissioning work isn’t a single challenge — however a sequence of initiatives that started in 2017. Many of the greater than 100 techniques which have or proceed to be upgraded are mission crucial from a enterprise and operations perspective, he says.
A core a part of digital transformation is decommissioning legacy apps, upgrading getting old techniques, and modernizing the tech stack. But, as interesting as it’s for workers to have the ability to use trendy applied sciences, decommissioning and changing techniques is arduous for IT.
“It’s a really lengthy and painful course of,” notes Don Henderson, CTO at BetaNXT, a wealth administration firm that gives tech providers to shoppers. Henderson is within the throes of an 18- to 20-month challenge to consolidate three database architectures for operational efficiencies. IT can be creating a brand new platform structure to allow the agency to maneuver off legacy expertise and construct cloud-based capabilities.
Andy Miears, associate at international tech analysis and advisory agency ISG, stresses that any decommissioning challenge should nonetheless be seen by way of a strategic lens. Whereas legacy techniques may be expensive to take care of and be susceptible to safety danger, that’s not at all times the case, he says.
“Newer, extra trendy techniques may have their downsides, resembling turning into overly burdensome, outliving their usefulness too rapidly, and needing to get replaced,” Miears says. “Any dedication of which techniques may or needs to be decommissioned ought to begin with the worth the system gives, versus the fee or dangers the system creates.”
Beautifying ERP
The choice emigrate from an over 25-year-old SAP ECC ERP system to S/4HANA was fairly clearcut for Ulta Magnificence. It wasn’t nearly upgrading expertise however eliminating inefficiencies, decreasing guide workflows, “and positioning Ulta Magnificence for breakout progress in magnificence and wellness,” says Mike Maresca, chief expertise and transformation officer on the magnificence retailer.
With buyer habits evolving alongside the rise of omnichannel buying, the nation’s largest magnificence retailer was underneath stress to maintain up. “We knew we wanted to modernize our legacy techniques to assist the agility, scalability, and effectivity wanted to remain forward,” Maresca says. Consequently, Ulta Magnificence launched Undertaking SOAR (strengthen, optimize, speed up, renew), which he calls “probably the most important IT-driven transformation in our firm’s historical past.”
Mike Maresca, chief expertise and transformation officer, Ulta Magnificence
Ukta Magnificence
The multi-year effort included the retirement of greater than 10 legacy apps, Maresca says. The core part of the ERP transformation began in June 2023 and targeted on modernizing key areas of the enterprise resembling merchandising, provide chain, shops, and e-commerce.
This overhaul streamlined finance, procurement, and stock administration whereas introducing automation to cut back guide duties in areas resembling vendor bill matching and money reconciliation.
“With real-time stock updates and improved procurement, we made our operations extra environment friendly,” together with the rollout of a cellular stock software dubbed MIA 2.0 throughout Ulta Magnificence’s 1,400-plus shops, Maresca says. “Associates now have higher instruments to search for merchandise and test stock, serving to them ship a extra customized expertise for our company.”
The challenge was not with out its challenges, and one of many largest was managing the complexity of the ERP transformation whereas holding day-to-day operations operating easily, Maresca says.
“It was really an enterprise-wide effort that required a number of cross-functional collaboration to maintain the enterprise operating whereas we rolled out 17 new functions, built-in with over 30 techniques, and coordinated throughout greater than 1,400 shops and our digital group,” he says. “It was an enormous endeavor that touched practically each a part of the enterprise and concerned all of our associates, all whereas making certain enterprise continuity.”
One other huge problem was change management, particularly contemplating the size of the transformation, Maresca says. To make the transition smoother, IT ran organization-wide workshops and coaching classes explaining the advantages of the brand new system and addressing any considerations alongside the best way.
Communication and collaboration with the enterprise was crucial to holding the whole lot on monitor, he says.
“We rolled out in phases, which allowed us to check and regulate the [SOAR] system incrementally, making the transition as seamless as potential,” he provides. Sturdy partnerships with key expertise suppliers additionally helped Ulta Magnificence overcome challenges and meet program objectives, he says.
Modernizing their operational spine with SOAR “empowers us to fulfill company wherever they store, improve personalization, and drive future innovation,” Maresca says. “It’s an funding in our potential to ship seamless experiences and maintain Ulta Magnificence’s management within the business.”
ROI features a 30% discount in guide processes, saving hundreds of hours of labor yearly, in addition to price financial savings, he says. From a monetary perspective, the S/4HANA platform “positions us to assist new classes, channels, and geographies, proving important for progress. It’s allowed for seamless enlargement of distribution facilities and new tax methods, making ready us for continued success.”
Legacy techniques which have ‘tentacles into the whole lot’
For the insurance coverage and monetary providers large’s transformation, Nationwide Life’s Mehta was circumspect about which techniques wanted decommissioning and began by ones that had been buyer going through.
“You virtually do what I name placing lipstick on a pig, which is modernizing your legacy ecosystem with wrappers, whether or not it’s internet wrappers, entrance finish and different applied sciences that enable prospects to have the ability to work together with extra trendy interfaces,” he says. Sooner or later, the lipstick on the pig runs out and you must begin reworking, Mehta provides.
Nimesh Mehta, SVP and chief data and technique officer, Nationwide Life Group
Nationwide Life Group
Enterprise customers had been additionally taken into consideration as IT thought-about their potential to work together with trendy interfaces with out touching the again finish.
The legacy transformation journey has required shifting groups away from pure software program improvement to give attention to turning into “grasp integrators,” shopping for items of software program and placing them collectively like Lego blocks to ship a aggressive benefit, Mehta says.
Core techniques chosen for decommissioning included enterprise techniques, underwriting techniques, and digital software techniques. The query grew to become methods to make the shift, Mehta says.
“If I put the roadmap out to remodel and modernize all my legacy techniques sequentially, it should go well beyond my retirement, as a result of most of those legacy techniques take a very long time they usually have tentacles into the whole lot in our group as a result of they’ve developed,” he says.
IT started with a laser give attention to knowledge. “Till you get your knowledge so as, it’s very arduous to do a legacy modernization for legacy transformation” and change one thing with out eliminating pointless knowledge, he says.
For instance, in case you are operating a system and transpose it into one other one, you’ll be able to’t sundown the outdated surroundings till the legacy system’s knowledge is organized and up to date, he says. “In any other case, you’re simply going to interchange one monolithic system with one other monolithic system.”
The info have to be put collectively in a rationalized style in order that the Lego blocks that carry out the minute capabilities of a monolithic system can connect themselves to the proper accessible knowledge, Mehta says.
“We’ve taken all these monolithic techniques and damaged them down into totally different capabilities and they’re much smaller,” he says. “These techniques will not be going to remain round for 25, 30 years, like they did earlier than. Their shelf life might be 5. And you’ll’t do legacy transformations constantly. You’ve obtained to have the ability to rip and change smaller elements than these huge, monolithic ones.”
Modernization gotchas
When a corporation is really legacy, most will probably have little or no documentation of how these techniques may be supported, Mehta says. That was the case for Nationwide Life, and it grew to become the primary roadblock.
“You don’t know what you don’t know till we start,” he says. That is the place the archaeological dig metaphor is available in. “You’re constructing a brand new metropolis excessive of the outdated metropolis, however you’ve obtained to have the ability to dig it solely sufficient so that you don’t collapse the muse.”
IT has to determine the whole lot a system touches, “as a result of over time, folks have completed all types of issues to it that aren’t clearly documented,” Mehta says.
One other concern for Nationwide Life was that IT doesn’t at all times have the abilities to decompose legacy techniques and the individuals who do have retired. In some situations, “there have been individuals who had been drawn out of retirement to assist us with a few of these issues,” he says.
Additional, new expertise distributors don’t fairly have the capabilities you’re in search of, and Mehta says, “you find yourself virtually constructing it for them.” A number of these firms are additionally startups that get purchased out and it turns into arduous to take care of continuity with them, he says.
“If you’re doing a legacy transformation that runs three to 5 years, you can have one, possibly two adjustments in possession alongside that journey.” That requires fastidiously crafting contracts that guarantee flexibility and leeway to handle these dangers with smaller distributors, Mehta says.
Mehta additionally opted to redefine Nationwide Life’s enterprise processes for the long run, “as a substitute of analyzing the rubbish I’m going to throw out” — one other main change.
Creating a transparent image was a method for IT to “leapfrog” and transfer towards what the enterprise will want, moderately than attempting to look at what they’ve, he says.
“That could be a huge cultural shift, as a result of as human beings, while you try this, you are feeling you’re giving up on one thing otherwise you’re leaving one thing behind,” Mehta says. “You’ve obtained to get to that mindset, and that was a breakthrough, and it took a while, however I believe it has labored very nicely for us. In order that lack of not understanding what’s there goes away while you’re attempting to get a number of readability of the place you need to go.”
Simulate and take a look at obsessively
BetaNXT’S Henderson inherited a number of tech stacks from two non-public fairness corporations, every with its personal tech stack.
“One among my engineers calls it a petting zoo of applied sciences,” he says, including that his objective is to consolidate and modernize for operational efficiencies and, sooner or later, transfer the whole lot to the cloud.
Don Henderson, CTO, BetaNXT
BetaNXT
The primary challenge entails eliminating 800 servers operating legacy Linux providers and CentOS and shutting down three datacenters. “We’re additionally operating legacy Oracle model 12 from 2012,” he provides. Henderson anticipates shifting about 50-plus shoppers that run on these platforms to the cloud by June.
As techniques are shut down, IT builds parallel techniques. “Our method was to simulate your entire course of, which was essential as a result of after we take knowledge from a legacy surroundings and put them in additional mod options, they don’t at all times work.” In any trendy system, Henderson says, there are a number of software program elements concerned.
“We did all of the work to get an surroundings we knew we may replicate. Then we deployed the brand new configuration into the cloud and had techniques operating in parallel,” he says. Then IT carried out an information migration.
“Previous knowledge is nice for us,” he says, as a result of they’ll leverage historic developments, however there are additionally regulatory necessities for holding it. “On this particular platform we’re engaged on we had 15-plus years of historic knowledge.”
Testing and verifying the configurations of a legacy surroundings with totally different working techniques, databases, and schemas was powerful as a result of 15 years in the past, “we didn’t have requirements round how we do multitenancy constructions.” Each legacy system had some customization and required some remediation, and that added hours, he says. It required “obsessively testing” every system.
IT saved a core set of providers that run on the mainframe, “however we’ve completed a very good job of holding that platform present,” he says. “It could nonetheless have code that’s 20-plus years outdated, however we’ve optimized it.”
He provides: “Typically legacy is okay if it’s constructed on the correct platform to do the correct processes.”
Nationwide Life’s Mehta echoes that sentiment. “There’s a number of legacy techniques which are simply superb for those who enable them to do the issues they do nicely.”
With the migration challenge nearing completion, Henderson not must handle massive capital money purchases. That is producing “important ROI as a result of each 4 months, I’m not asking for $800k for brand new servers.” Eliminating knowledge facilities will even produce important price reductions, he says, estimating that can be near a 200% financial savings.
Don’t postpone decommissioning techniques when modernizing
If you modernize, you should have a decommissioning technique as a part of the plan, Mehta says. If you happen to simply say it should occur later, it by no means will.
“Individuals transfer on to different issues,” he explains. “You must have a plan to do away with” legacy techniques. He additionally found that “decommissioning isn’t free. Everyone thinks you simply shut a swap off and legacy techniques are gone. Legacy decommissioning comes at a value. You must be keen to soak up that price as a part of your new system. That was a lesson discovered; you can not ignore that,” he says.
It’s additionally essential to slowly transition capabilities as a substitute of trying a whole “huge bang” alternative, Mehta says.
Profitable modernization additionally requires a robust collaboration between enterprise and IT groups, and making IT’s worth seen to management, says Ulta Magnificence’s Maresca.
“We prioritize transparency by sharing updates on IT initiatives by way of government briefings, city halls, and detailed stories,” he says. “By showcasing tangible outcomes, we be sure that IT’s function in driving enterprise success is clearly understood and aligned with our total goals.”
See additionally: