8 Challenges of Working with Legacy Technology

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The last two decades have seen a transformation in people’s buying behavior and lifestyle choices and even still, an unprecedented one (transformation) in the retail industry. The good thing is that customer demand is growing steadily.

Competitive pressure is extremely high and e-Commerce players have disrupted and are continuing to disrupt the market. At the same time, physical retailers too are building sustainable business models by experimenting with new methodologies, with the aim of bringing down costs.

On their part, customers are more demanding and are spoilt for choice. They seek outstanding variety, amazing quality, and the freedom to shop across devices, channels, and geographies seamlessly.

It has become completely essential for retailers to empower their journey, by making the right technology investments, and most of them have already begun to take the necessary steps. 54% of respondents listed expanding ‘Omni-Channel’ or unified commerce initiatives (as per Gartner’s CIO Survey, 2018), as a technology-driven plan of action over the next 18 months.  Increasing and leveraging customer and social media engagement, were at 54% and 51% respectively, in the same survey.

At the same time, retailers who decide not to rely on legacy technologies will stand to gain in the long term even if they don’t save on costs in the short term.

In the age of digital commerce, check the following disadvantages of depending on legacy technology:

Non-Touchpoint Integration

With legacy systems, data is often housed in silos. As a result, external customer touchpoints especially, such as social media, make it difficult to integrate systems. Therefore, the customer buying experience is not as smooth as it should be because of the lack of integration.

Vendor Management Complexities

Multiple customers and vendors form a part of a large ecosystem that Retailers typically need to work with. Not only do managing multiple systems make it tough to create a unified experience, but also fails to create a seamless experience by adding to management overheads.

Non-Single View of Customer

Having customer data stored in disparate systems with no means of exchange implies that, especially across various channels, the organization does not have access to a real-time or simply, a single view of customer engagement. This severely inhibits its ability to provide a differentiated customer experience and one that can drive loyalty. Since the engagement is not backed by online engagement data, this leads to an in-store customer experience that is sub-optimal in nature.

Non-Single View of Inventory

In the world of Retail, effective management of inventory becomes an important factor to drive profitability, especially in areas such as fashion, or perishables such as grocery. To ensure that inventory remains at the optimum level, having real-time visibility into inventory across different channels and supply chain is imperative. Also, the ability to track inventory across channels permits better planning and insights.


Dynamic demand with seasonal highs and lows is the order of the day in Retail operations. For example, when there is a sale or during a festive season, there might be a sharp spike in sales. Legacy systems are ill-equipped to seamlessly handle these occasional peaks, which can lead to crashed billing systems and/or websites, and poor customer experience as a consequence.

Modernization Constraints

Legacy systems do not gel well with the adoption of new digital technologies such as IoT, Cloud, Machine Learning, Chatbots, Artificial Intelligence (AI), Augmented Reality, etc. What is imperative, is a modern core infrastructure that can communicate seamlessly with newer hardware and software.

Greater Operational Costs

Legacy systems require more resources and manpower and are generally more difficult to maintain. Also, there are greater chances of system breakdowns, which mean that repairs would be needed frequently. Therefore, as compared to modern platforms that are lean, operational costs are often seen to be higher for legacy systems.

Security Concerns

Over the years, the threat landscape has been growing rapidly, with more sophisticated security threats and viruses that legacy systems simply may not be equipped to handle. Modern systems are by far, more effective in dealing with such security threats.

As the world advances towards a highly digital environment, it becomes important for retailers to drive greater profitability and creating fulfilling customer experiences to future-proof their business, as well as to upgrade their infrastructure.

Milind Gehlot

Article written by

Product Manager, Dynamics 365& Brick & Click at Sonata Software

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