Legacy vs. Open-Architecture Core Systems – When is it time to Migrate?

Financial institutions often operate from software systems that have been in place for many years. While the “old” technology may still work, legacy systems that aren’t compatible with changing technologies can cause big headaches for those that must work in them every day, as well as their customers and vendors. If you’re operating on a closed system, you might consider upgrading if:

1. Your software can’t keep up with new technologies. Legacy systems simply aren’t designed to be compatible with new technologies. Considering the pace at which innovation occurs in the tech sector, this is a big problem. If your system is closed to future development, you will be stuck behind the curve of innovation. An open-architecture system allows you to connect with current technologies and be prepared for inevitable future developments.
2. Upgrades are cumbersome and time-consuming. Updates on legacy systems are often time-consuming because a “small” change to one component affects many other aspects of the system. You can’t apply a simple patch and move on – everything must be reworked. Open systems are adaptable and can be modified incrementally over time with quicker updates.
3. Costs of maintaining your legacy system are too high. Upgrading and maintaining a legacy system is typically more expensive than adding capabilities to an open platform. Adding on new technology to a legacy system creates a disjointed patchwork of components that become more complex and therefore more difficult to operate over time.
4. You are experiencing cybersecurity vulnerabilities. Hackers and other malicious actors are constantly looking for new ways to exploit systems and steal valuable company information. Legacy systems cannot address these threats in the same way that an open, flexible systems can. Because changes take longer to apply to legacy systems, company data can be exposed for a longer period of time.
5. Your software can’t evolve with your business. Software that is customizable to changing company needs is critical to ensure efficient work. An open core allows you to be more flexible with your technology and update it as the business landscape changes. You must be able to meet your customers and vendors where they are in the digital realm.

An open-architecture system allows for seamless integration of the latest technologies. Your credit union needs the capability to add on future technologies and products to stay relevant and engaged with your members. Legacy systems are a thing of the past – it’s time to be out with the old and in with the new.

Rhiannon Stone

COO

EPL, Inc.