Legacy Systems: How to Escape the Cost Trap!
By Emanuel Böminghaus, Legacy Systems Expert and Managing Director, AvenDATA
By Emanuel Böminghaus
Legacy Systems Expert and
Managing Director, AvenDATA
Managing Director, AvenDATA
Uncover the Hidden Costs
Legacy systems can drain money for years, even though the actual business processes have long since moved to new platforms. Applications that are needed only for historical inquiries but still require a complete operating environment are particularly worth examining in a cost analysis. Anyone looking to save money here must account for every cost: software subscriptions and maintenance, databases, servers, storage, backups, security measures, and internal and external support.
Associated test environments and interfaces belong in this inventory as well.
Microsoft explicitly recommends evaluating decommissioning candidates based on their operating and maintenance costs, usage, technical importance, and compliance requirements. This makes it possible to set economic priorities. Companies should first review the legacy systems that generate high avoidable costs and whose operational tasks have already been fully replaced. The potential impact is especially large when the application’s dedicated infrastructure and support can be eliminated along with it.
End Ongoing Payments
The savings levers with immediate effect are cancelable maintenance and support contracts, subscriptions, hosting, and external operating services. Notice periods, minimum purchase commitments, and obligations under master agreements are critical here. A technical shutdown only translates into financial relief once the contracted services are actually reduced or terminated. Microsoft therefore recommends reviewing existing contracts for ongoing obligations and potential termination fees before decommissioning. The same applies to infrastructure.
In Azure, for example, virtual machines that are stopped but not deallocated continue to be billed, and disks that are no longer attached also incur costs. After archiving, all resources that are no longer needed must therefore be reviewed and systematically removed. When it comes to support, a further distinction is worthwhile. Less administration frees up internal working time. Additional budget relief comes, for example, from lower service provider costs or avoided new hires. AWS accordingly evaluates internal productivity gains and reduced external operating costs separately.
Streamline Your Migration
Another cost lever comes into play even before an ERP or SAP S/4HANA migration. Companies should determine early on which historical data can be archived separately and what information the new production system actually needs.
SAP explicitly cites archiving as an important factor in reducing conversion runtime and points to the high cost of continuing to operate legacy systems after a migration. This suggests a two-pronged approach: deliberately reduce the volume of data to be transferred, and limit the duration of any subsequent parallel operation. Less data to transfer and process can reduce migration effort and the required target capacity; the actual savings depend on the project and the operating model. The prerequisite is that all required historical information remains fully accessible.
For data subject to tax retention requirements, particular attention must be paid to completeness, the necessary data relationships, and the ability to evaluate the data electronically. An incomplete export is not sufficient. That is why data scope, source documents, reports, and business sign-off belong in decommissioning planning from the very beginning.
Decommission Cost-Effectively with ViewBox
AvenDATA supports the archiving and decommissioning of such legacy systems with ViewBox. Historical data, reports, and related source documents remain searchable through a central web interface, with role-based permissions controlling access. Once data migration, verification, and acceptance have been successfully completed, the replaced source system can be taken out of operation.
A concrete calculation shows whether the project pays off. The annual legacy costs that are actually eliminated are compared with the ongoing archive costs and any remaining additional costs. One-time expenses for data migration, reports, testing, parallel operation, and shutdown must also be factored in.
A simplified, hypothetical example: If €120,000 in annual legacy costs is eliminated and archive costs including support amount to €42,000, the annual relief is €90,000. With one-time project costs also totaling €90,000 and no other additional costs, the investment would break even twelve months after costs have been fully eliminated.
The key is therefore an analysis based on actual contracts, resources, and retention requirements. This turns legacy system archiving into measurable relief for the IT budget.