For over twenty-five years, organizations of all sizes, in all industries have been running mission critical, legacy applications built with PowerHouse, Transact or VPLUS. These rich, custom-built applications were state-of-the art, at the time, and have been corporate workhorses running a wide range of functions within departments such as finance, HR, operations and customer service. But in the rapidly changing technology field, even the most successful products decline and are replaced. And PowerHouse, like other development languages that preceded it, is quickly fading into history along with the computers for which it was originally designed. As such, there are a number of reasons why organizations need to migrate these legacy applications to modern architectures

Business Problems

Flexibility: With legacy applications, it is difficult, time-consuming and expensive to leverage modern features or functionality such as graphics and desktop integration. As a result, these rigid applications constrain the flexibility of organizations, preventing them from adapting or responding to changing market conditions. This means that the evolving needs of end users, including employees, partners and customers, cannot be easily met, resulting in poor service and dissatisfaction.

Productivity: And because they’re character-based (“green-screens”), legacy applications are slower and more difficult to learn and use than modern applications that have a graphical user interface. This negatively impacts the productivity of end users, particularly new end users. For example, if a PowerHouse application reduces the productivity of an end user by just 15 minutes each day, relative to a modern application, and there are 1,000 end users of this application each being paid $50,000 per year, then this application costs the organization about $1.5 million per year in lost productivity. When lost productivity related to training and maintenance are factored in, the situation becomes significantly worse.

Competitiveness: While the deep, specialized functionality that has been built into these applications over the years has helped many organizations that sell software based on them to become market leaders, it is becoming increasingly difficult for many of them to compete with newer, web-based applications. These companies are highly exposed to an erosion of sales and market share.

Technical Problems

Leverage: PowerHouse, Transact and VPLUS are becoming obsolete as a programming languages and little investment is being made in them compared to those being made in .NET technology. As such, these legacy applications generally can’t take advantage of many new features within the new hardware and database and other software that organizations have recently invested in. This means that they’re not maximizing the value of these other investments.

Obsolescence: The platforms that these applications run on are, in many cases, being phased out. Hewlett Packard, for example, has announced it will no longer support the HP e3000 as of December 31, 2010. Once these platforms are no longer supported, the costs and risks associated with supporting these applications increases significantly.

Staff Knowledge: Because these applications have been around a long time, the legacy programmers on staff, for example, typically have some of the deepest knowledge of the organization’s business.. So unless these programmers are provided with a forward career path that involves more mainstream web-based technologies, a valuable asset could walk out the door.

Staff Flexibility: Legacy programmers are difficult and expensive to replace. Unlike .NET and other languages, schools aren’t teaching PowerHouse, Transact or VPLUS anymore. So an increased reliance on legacy programmers puts firms in a highly risky position. In addition, the flexibility and responsiveness of the IT department will be hampered unless the legacy programmers have more modern programming skills that can be leveraged to support other projects.

Standards: Organizations have made strategic investment decisions regarding technology standards. And yet, legacy applications don’t align with these standards. This outlier is becoming increasingly awkward to justify and manage.

Financial Problems

Labor – End Users: Because character-based applications are more difficult to learn, and less efficient to use than modern applications, there are significant labor costs associated with training new end users, and using these applications. They’ll also require more staff to support current and future business than would be necessary with modern applications.

Labor – IT: The legacy programming skills that are required to support these applications are becoming increasingly scarce and expensive. A typical legacy developer, for example, can be 1½ - 2 times as expensive as a .NET or Java developer. To make seemingly minor changes to the applications can be extremely expensive.

Support and Maintenance: Many firms spend hundreds of thousands of dollars each year to support and maintain hardware and software that is rapidly becoming obsolete. The return on this investment is minimal. It’s far wiser to invest support and maintenance dollars in technologies that provide the foundation for growth.

Revenue: In addition, for companies that sell legacy-based applications, revenues will be negatively impacted as their customers increasingly shift towards buying modern applications. And for those organizations that use these applications internally, the lower productivity, and inability to extend these applications to serve new users and markets, including partners and suppliers (extranet) or clients (Internet), will reduce the revenue potential of the enterprise.

To learn how you can overcome the limitations of legacy applications, get the business white paper "Migrating PowerHouse Applications to Modern Architectures".