Modernising legacy systems is essential for business agility, scalability, and competitiveness. However, determining the right modernisation strategy can be complex, with multiple paths to achieve transformation. In this article, we take a closer look at the 5Rs of Legacy Modernisation—Rehost, Refactor, Rearchitect, Rebuild, and Replace—and how organisations can choose the best strategy based on their specific needs, goals, and legacy system landscape.
Selecting the right approach ensures that modernisation efforts align with both business objectives and technical requirements, while mitigating risks and optimising long-term value.
The 5Rs of Legacy Modernisation: When to Choose Each Strategy
Organisations often struggle to determine the most effective way to modernise their legacy systems. The 5Rs framework provides structured approaches tailored to different challenges:
- Rehost (Lift and Shift)
- Definition: Moving applications to a new environment (typically cloud) with minimal changes.
- Best for: Quick, low-risk transitions when the system is still valuable but needs a more scalable environment.
- Use Case: Organisations with stable applications requiring improved infrastructure without code changes.
- Refactor (Code Optimisation)
- Definition: Modifying existing code to improve performance, maintainability, or scalability without changing core functionality.
- Best for: Optimising performance and efficiency with minimal disruption.
- Use Case: Enhancing databases, API integrations, or system responsiveness.
- Rearchitect (Cloud-Native Design)
- Definition: Restructuring applications to leverage cloud-native features like microservices and containers.
- Best for: Aligning legacy systems with future scalability and modern frameworks.
- Use Case: Businesses moving from monolithic applications or preparing for AI/ML capabilities.
- Rebuild (From Scratch)
- Definition: Redeveloping applications using modern technologies to align with new business requirements.
- Best for: Outdated or rigid systems that cannot support modern operations.
- Use Case: Organisations needing cloud compatibility, enhanced security, or new functionalities.
- Replace (Full System Overhaul)
- Definition: Replacing legacy systems with commercial off-the-shelf (COTS) or SaaS solutions.
- Best for: When maintaining or upgrading existing systems is no longer viable.
- Use Case: Replacing legacy ERP, CRM, or other enterprise applications with modern SaaS alternatives.
How Merit’s Consulting Framework Ensures the Right Fit
At Merit, we help organisations select the optimal modernisation strategy using a structured fitment analysis, assessing key factors such as:
- Business Goals: Cost reduction, scalability, AI-readiness, or performance improvement.
- System Complexity: Whether incremental upgrades (refactoring) or full-scale transformation (rebuilding) is necessary. Or, is something in-between ideal?
- Budget & Timeline: Faster, cost-effective solutions vs. long-term strategic investments
- Technology Alignment: Whether integrating AI, cloud, and analytics is a priority.
- Risk Tolerance: Balancing downtime, data integrity, and operational disruption.
- Change Management: Identify change management bottlenecks and define risk mitigation strategies.
This thorough analysis enables Merit to deliver tailored strategies that maximise ROI and minimise risk.
AI-Ready Support for Every Strategy
Merit empowers each modernisation strategy with advanced tools and frameworks:
- AI-Ready Architecture Frameworks: Ensure scalability, resilience, and seamless integration of AI/ML capabilities.
- LLM-Powered Code Conversion Utilities: Automate migration from legacy languages (e.g., COBOL, SAS, SQL) to modern languages (e.g., Python, Java, PySpark), reducing errors and accelerating transformation.
- Prompt Libraries and Best Practices: Streamline code generation, adherence to standards (PEP-8, OWASP), and development workflows.
- Test Automation and DevSecOps: Enhance security, quality, and predictability throughout the modernisation lifecycle.
Case Study: Rearchitect & Rebuild for Future-Ready Analytics
A global automotive analytics leader, specialising in vehicle data and pricing intelligence, faced multiple challenges due to outdated systems:
- Fragmented data sources (15+ applications) led to reporting inconsistencies.
- Lack of AI/ML capabilities limited predictive analytics.
- Scalability issues slowed data onboarding and integration.
Merit’s Solution: A hybrid approach combining rearchitecting and rebuilding:
- Cloud-Based Data Platform: Unified data sources into a large-scale data lake (150+ GB daily data).
- Azure native: Integrated Azure stream analytics, Databricks Spark Streaming, Azure Data Factory, Azure Functions, and ADLS for real-time data management.
- Advanced Data Processing: Migrated SAS & SQL code to PySpark using automated code conversion, cutting assessment and design timelines by 60%.
- Enhanced Reporting: Built a React-based web app and Power BI dashboards for real-time insights.
Results:
- $12M+ revenue increase through AI-powered data insights.
- 40% reduction in IT infrastructure costs.
- 30% improvement in sales targeting with real-time analytics.
- 70% faster data onboarding, boosting operational efficiency.
Best Practices for Successful Modernisation
Successful modernisation goes beyond choosing the right strategy. At Merit, we integrate best practices to ensure seamless transformation:
- Prompt Libraries for Automation: High-quality, standardised code generation across modernisation projects.
- Test Automation Frameworks: Minimise downtime, mitigate security risks, and improve system stability.
- DevSecOps Integration: Embed security at every stage to prevent vulnerabilities during and after migration.
These practices enable faster deployment, fewer errors, and long-term resilience in modernised systems.
Future-Proof Your Legacy Systems with Merit
Choosing the right modernisation strategy can determine the success of your digital transformation. With our proven frameworks, AI-powered automation, and best practices, Merit ensures a risk-free, high-ROI modernisation journey.
Ready to modernise? Contact our experts for a tailored fitment analysis today!