Time to let go of legacy systems

In the relentless march of technological progress, businesses often find themselves tethered to outdated systems, trapped by the investments of the past and the fear of transition. Nowhere is this more evident than in the realm of human resources (HR) systems, where legacy technology can hinder agility, compromise efficiency, and stifle innovation. Despite the comfort of familiarity, the imperative to let go of legacy systems in HR cannot be overstated. Why should businesses embrace this change?

Legacy systems, relics of a bygone era, pose a significant challenge to organizational adaptability and competitiveness. Pieter Vaniperen, a seasoned software architect, was cited by an SHRM.com article about the inherent fragility of such technology, likening it to a ticking time bomb awaiting its inevitable demise. The illusion of cost-saving by postponing upgrades is shattered when confronted with the reality of inevitable breakdowns and the mounting expenses of perpetual maintenance.

In the same SHRM.com article, Rhonda Marcucci, a distinguished HR technology consultant, emphasized the pivotal role of legacy systems in constraining workforce management, benefits administration and employee satisfaction. The inability to swiftly adapt to evolving needs, such as remote work requirements during the pandemic, underscores the critical shortcomings of outdated HR systems. Moreover, the erosion of employee trust and confidence in an organization’s technological capabilities can have far-reaching implications for talent acquisition and retention.

Mike Loukides, a thought leader in emerging technologies, underscored the need for HR leaders to articulate their case in the language of business objectives, as cited in the SHRM.com article. Rather than fixating on technical deficiencies, the focus should be on the tangible impact on revenue generation and cost reduction. Legacy systems, he contended, are not merely relics of the past but inhibitors of future growth, perpetuating a cycle of missed opportunities and unrealized potential.

The financial argument for replacing legacy systems transcends mere technological obsolescence. Marcucci elucidated how the cost of new software pales in comparison to the expenditures on manual work, positioning the investment in modern HR technology as a strategic imperative rather than a discretionary expense. By framing the discussion in terms of the bottom line, HR professionals can effectively engage senior leadership, particularly the CFO, in the imperative of technological modernization.

However, the transition from legacy systems to contemporary HR technology requires more than just financial justification; it demands a fundamental shift in mindset and organizational culture. Loukides cautioned against the allure of superficial features, urging stakeholders to prioritize functionality over novelty. The true value of technology lies not in its bells and whistles but in its ability to drive tangible business outcomes, whether through revenue growth or cost optimization.

At its core, the decision to let go of legacy systems is a pressing need driven by the imperative of business survival and prosperity. Vaniperen emphasized the sobering reality that technological stagnation posed an existential threat to businesses in an increasingly competitive landscape. By reframing legacy technology as a liability rather than an asset, HR leaders can galvanize decision-makers to embrace change and chart a course toward digital transformation.

In summary, the reluctance to let go of legacy systems in HR is rooted in a combination of inertia, sunk costs and fear of the unknown. Yet, as the experts can attest, the costs of maintaining the status quo far outweigh the benefits of technological stagnation. By building a compelling business case grounded in tangible outcomes and critical requirements, HR professionals can catalyze organizational change and propel their companies into a future defined by innovation, agility and resilience. The time to let go is now.

It is timely, meanwhile, that Darwinbox and Hungry Workhorse are organizing a gathering of HR leaders in the country to deliver a seminar on “Change for Great Success: Why Top Companies in the Philippines are Shifting from Legacy to Darwinbox,” happening on May 29, 2024, in Makati City. Speakers include veteran HR practitioner Nicasio Lim; Vikrant Khanna, global head of value management and ddvisory Solutions at Darwinbox; and Aditya Gupta, region head of strategic accounts at Darwinbox.

Darwinbox is a new-age, end-to-end, mobile-first, and employee-first integrated HR system that serves 900-plus enterprises and over 2.5 million employees across more than 116 countries. In the Philippines, Darwinbox works with enterprises like Maxicare Healthcare, Shakey’s Pizza, Robinsons Bank, Security Bank, Toyota Motor Philippines, and JG Summit Holdings, plus leading international brands such as Nivea, Starbucks, Dominos, Sephora, Swarovski, Adidas, Zara, Lacoste, and Calvin Klein.


The author is the founder and CEO of Hungry Workhorse Consulting, a digital, culture and customer experience transformation consulting firm. He may be emailed at rey.lugtu@hungryworkhorse.com.

Source: https://www.manilatimes.net/2024/05/09/business/top-business/digital-art-of-storytelling/1945319