Application Modernization Strategy: Ultimate Guide

Benefits of Application Modernization

Modernization strategies take considerable effort, time, and investment. But the benefits? They are evident across various levels, making a real difference for your team, customers, and the whole business. 

Below, we collected the core advantages that app modernization strategies bring. 

Improved Agility and Time-to-Market

Modernization boosts agility and innovation. Without the need for resource-consuming maintenance of a legacy app, you’ve got more opportunities to update, optimize, and innovate in response to shifting customer, industry, or business requirements. Modernized apps ensure faster time to market when it comes to new features roll out, ultimately increasing market share and revenue.

Enhanced Security and Compliance

Modernization strategies allow companies to address existing issues and implement advanced security protocols along with the latest approaches for app security, which are often unsupported by outdated systems.

Modern applications ensure compliance with regulations and provide enhanced protection through current security protocols, support for ongoing security patches, advanced authentication methods such as multi-factor and biometric verification, and built-in encryption that protects sensitive data. 

Reduced Technical Debt and Maintenance Costs

Legacy applications often accumulate outdated architectures, complex dependencies, and old coding standards, slowing down operations and skyrocketing maintenance costs. As this technical debt grows, it creates blockers for innovation and agility. With a strategic modernization approach, you can remove outdated code patterns, eliminate overly complex structures that cause errors, introduce modern development practices that reduce the risk of accumulating new debt, and establish clean, well-documented architectures that make future updates faster and more manageable.

Scalability and Performance Gains

Modernized applications can scale efficiently alongside your business and maintain high performance under varying loads. By adopting cloud-native technologies, microservice architecture, and containerization, businesses can dynamically allocate resources based on actual demand – ensuring consistent performance during peak periods and reduced costs when usage is low. Through task automation, modern solutions streamline workflows, reduce overhead, drive productivity, and enhance customer experience.

The 7 R’s of Application Modernization Strategies

When you're just about to start your application modernization journey, that’s the thing you should know first: all the transformation strategies come in diverse forms, based on complexity and goals. Some approaches involve minimal changes, while others mean a complete restructuring of your solution. 

Rehost ("Lift and Shift")

This approach involves moving an existing app as-is from an on-premises server to cloud infrastructure, with minimal to no code changes. Rehosting is quicker, simpler, and less expensive as compared to other strategies. However, this approach is suitable if the app’s current version is compatible with the new infrastructure. Otherwise, you should consider some of the next modernization methods.

Refactor

This approach to application modernization is also known as re-packaging, as it involves codebase changes to achieve improved performance, design, and maintainability. In this case, the functionality and behavior aren’t altered. 

Refactoring is chosen when the application code is too messy or hard to maintain – even though adjustments are invisible for end-users, they’re still needed. 

Rearchitect

This method involves either re-architecting an application from scratch or making noticeable modifications to its code and functionality to scale better in the cloud. Here, monolithic applications are divided into microservices that can be built, deployed, and managed independently. It also might include replacing proprietary APIs and software dependencies with open-source alternatives. Re-architecting results in reduced TCO, better resilience against outages and performance issues, and improved agility.

Rebuild

This application modernization strategy is more serious and complex – it involves building the app from the ground up with new technological or operational requirements. Sometimes, rebuilding keeps an app’s core functionality but redesigns its structure as a cloud-based solution. 

Rebuilding can be executed gradually and is optimal when refactoring or re-architecting are too resource-intensive, yet you want to leverage the advantage of cloud-based services. 

Replace

Replacing a legacy solution with a new, ready-made app might save you valuable time and resources in cases when rebuilding or any other modernization endeavors are too long, complex, or completely ineffective. The app might not be supported on the latest OSs or by major cloud providers. But consider that this approach has potential challenges, such as process disruptions or limited future modernization efforts.

Retire

Some legacy applications become too expensive to maintain, vulnerable to security issues, and fail to support existing or future business needs whatsoever. If an app only drains resources and hampers growth, retiring is the right way out. This means gradually withdrawing the legacy solution from use while migrating the critical components to modern environments. 

Retain (Encapsulate)

In some cases, keeping an outdated app in its current state is the most practical option – especially if it still performs reliably, delivers sufficient business value, or has limited interaction with other systems. This strategy is typically used when an application relies on another system that must be modernized first, or when the modernization cost and effort outweigh the potential benefits. Organizations can also retain a legacy app if they plan to integrate a SaaS soon. 

Though this method doesn’t solve problems related to the app’s inefficiencies, scalability, and costs, it allows teams to prioritize application modernization initiatives and revisit the retained systems once business priorities or technical dependencies change.

How to Choose the Right Modernization Strategy

Modernization isn’t just a technical update – it’s a strategic business move that aims to improve agility, competitiveness, and fuel long-term growth. Hence, choosing the right application modernization strategy is the first and highly important step. Make sure you go through these 3 phases to make a well-informed decision and modernize with minimal disruptions. 

Assessment and Evaluation

To make a good plan, you first need to understand where you start. For this, perform an end-to-end assessment of your current application landscape to pinpoint strengths, inefficiencies, duplications, and potential risks. 

To ensure a comprehensive evaluation, document and map all system interactions, deeply check legacy code and infrastructure platforms, and test for scalability to minimize further limitations. 

Decision Factors: Cost, Complexity, Risk

The choice of modernization strategy must align with your organization's risk tolerance and available resources. Before making the final decision, consider these factors:

1. Cost. Assess both the upfront and long-term costs associated with modernization, including development, training, and maintenance expenses.
2. Complexity. Evaluate the application architecture, codebase, and integrations to understand the effort required for modernization.
3. Risk. Identify potential problems such as data loss, downtime, and security issues that could arise during modernization.

Matching Strategies to Business Goals

A modernization strategy that is right for you must match both your current needs and long-term goals. Whether it’s enhancing operational efficiency and reducing costs, driving innovation and agility, or improving scalability and performance, make sure the selected strategy serves these tasks, and modernization efforts drive meaningful value. 

Step-by-Step Guide to Implementing an Application Modernization Strategy

What makes application modernization successful? Careful planning and structured execution. This guide covers all the key steps to transition from legacy systems with minimum risks and maximum profits.

Real-World Use Case: Walmart’s Successful Modernization

Walmart is known as a worldwide leader in omnichannel retail. The rapid advancements of e-commerce and mobile shopping have made them consider transformations to maintain efficiency and stay competitive. 

Their outdated, all-in-one solution struggled to handle peak traffic periods. 

Modernization, particularly the transition to cloud microservices, was required to reduce downtime and improve performance during peak seasons.

These modernization efforts solidified Walmart’s leadership in omnichannel retail and made it a major player in online commerce as well.

Common Pitfalls and How to Avoid Them

Legacy technology modernization is an exciting journey leading you toward new opportunities and heights. However, it is often dotted with obstacles that might hinder your progress. But knowing them ahead means you can make your digital transformation smoother and less stressful. Below, uncover the most common challenges to be aware of. 

Underestimating Complexity

Legacy systems often have complex dependencies, outdated code structures, and lack comprehensive documentation, making the application modernization process more complicated than initially anticipated. Overlooking or underestimating these factors can lead to unexpected (and unfavorable) results – integration challenges, system downtime, delays, and technical debt. To avoid such outcomes, perform a comprehensive initial assessment to pinpoint potential risks and implement a phased, strategic approach. 

Ignoring Change Management

Application modernization projects aren’t only about technology but about people and processes, too. Successful transformation is based on a holistic approach – this means fostering the culture of innovation and change, educating teams on the importance of modernization, and conducting staff training. Lack of effective change management strategies is among the most frequent mistakes blocking modernization initiatives.   

Failing to Align with Business Strategy

Disconnected business objectives and application modernization strategies result in unmet expectations, operational disruptions, inefficiencies, and financial losses. This misalignment not only wastes valuable resources on initiatives that don’t support strategic goals but also shifts the focus from the essentials. After all, teams struggle with decreased productivity, confusion, and extended timelines. 

How InVerita Can Help with Your Modernization Journey

The secret to seamless and effective application modernization? The right, effective strategy, a detailed plan, and a reliable partner with hands-on experience in your domain. 

InVerita helps companies across industries move on from legacy systems and tap into the full potential of their technology. Our experts assist in choosing the best strategy and implement it, covering the whole way through.