The technology leaders of large organizations are under continual pressure to deliver up-to-the-minute business data to constituents while still keeping costs in line for shareholders. Executives demand increasingly sophisticated, real-time reports on sales and other key business metrics. Customers and partners want self-service, Web-based tools that provide up-to-date answers to questions about inventory, accounts, billing and support. The CEO wants to know: how can our company’s information systems speed time to market, differentiate us from our competitors and increase profitability?

These relentless business imperatives are placing new demands on legacy systems. The term legacy itself has taken on a negative, “past its prime” connotation. And with the added demands to adopt newer Internet-based technologies, organizations are debating over whether or not to ‘rip and replace’ their legacy systems in order to modernize their IT infrastructure and save money. However, the rip and replace approach is rarely the right answer. Why?

Probably the biggest reason is that for an enormous number of companies, legacy applications are mission-critical (it is estimated that 70% of the world’s data still resides on the mainframe). They run the purchasing, manufacturing, financial and payroll systems that form the very backbone of the business. They house the data and business processes that differentiate a company from its competitors and represent years of valuable intellectual property. Ripping legacy systems out and replacing them with newer systems, when less drastic alternatives still exist, makes little fiscal or strategic sense.?

In addition, the experience of a number of well-known organizations demonstrates that rip and replace projects can be costly and prone to failure. And the price tag for a failed attempt can run into the hundreds of millions of dollars. But even when these projects do succeed, rip and replace remains a high-cost, time-intensive approach.

While in many cases legacy applications continue to meet business needs, they often do have some key limitations. Legacy systems are often disconnected from the enterprise; they house silos of data that are difficult to integrate with other silos and they are sometimes difficult to support. But (marketing hype aside) these difficulties do not exist in every organization that operates legacy systems. So, on balance, is there a reasonable alternative to rip and replace that mitigates the downside of legacy systems and builds upon the inherent positives?