Still Running On Legacy Systems? Here’s What It’s Really Costing You

Legacy systems are like old habits – familiar, routine, and often underestimated in their impact.

For many organisations, they’ve become the silent backbone of operations. But beneath the surface, these aging platforms are exacting a growing toll: operational inefficiency, compliance exposure, workforce frustration, and missed opportunities for digital innovation. What’s worse, the cracks usually reveal themselves at the worst possible moment: during an audit, a merger, a payroll miscalculation, or a system outage with real-world consequences.

At Solution Minds Consulting (SMC), we’ve worked with hundreds of businesses across sectors navigating this very challenge. While no two transformations are alike, the underlying story is often the same: the decision to delay replacing a legacy system costs far more than leaders expect and success comes not from urgency alone, but from strategy, readiness, and clarity of purpose.

The Hidden Cost of Legacy Technology

Despite their longevity, legacy systems are increasingly incompatible with today’s operational demands. Our advisory engagements consistently uncover five key impacts that are often overlooked until they become acute:

1. Operational Inefficiency and ReworkFragmented workflows, double handling of data, and outdated interfaces slow teams down and drive up labour costs.
2. Compliance RiskParticularly in areas such as payroll, awards interpretation, and workforce scheduling, older systems often fall short of regulatory standards.
3. Disconnected Data EcosystemsLegacy platforms typically don’t integrate well with modern tools, creating blind spots across reporting, analytics, and decision-making.
4. Vendor and Infrastructure VulnerabilityMany legacy systems are no longer actively supported, creating single points of failure and escalating the cost of maintenance.
5. Inability to Scale or TransformAs organisations grow or shift direction, legacy systems can’t adapt – limiting innovation, speed, and agility.

The result? A business constrained by its past rather than empowered by its future.

Real Triggers for Change: Four Case Studies

The decision to replace legacy systems is rarely made lightly. Often, it’s sparked by a specific tipping point. Below are four anonymised case studies from recent SMC client engagements that illustrate what drives change – and what success looks like when it’s done well.

Case A: Payroll System Sunset in a National Support Provider

A government-funded support organisation had used the same payroll platform for over a decade. When the vendor announced it would be sunset, the organisation faced an urgent gap in functionality. Their existing system couldn’t support complex rostering or deliver modern workforce management analytics.

SMC partnered with the organisation to map their current processes, assess readiness, and run a structured options analysis. Using a five-year cost model, we helped the executive team evaluate platforms such as Dayforce and UKG Ready, including comparisons with outsourced payroll providers. The result was a robust business case that enabled clear board-level decision-making and a smooth transition pathway.

Case B: National Aged Care Rollout After Legacy Bottlenecks

A large, aged care and disability support organisation faced mounting pressure from fragmented client management and scheduling systems across its growing franchise model.

Following a readiness pulse check, SMC led the transformation program. We provided program governance, technology implementation support, and change management capability. The organisation replaced its legacy platforms with scalable, cloud-based solutions – and successfully rolled out the program across 55+ locations five months ahead of schedule.

Case C: ERP Rescue for a Manufacturing Business in Crisis

In the manufacturing sector, one client initiated an ERP project to replace a 20-year-old on-premises system. But the rollout had stalled. Scope creep, misalignment with vendors, and fatigue among internal teams were putting operations at risk.

SMC was engaged to lead a project rescue. We restructured governance, clarified the scope, reset vendor relationships, and delivered go-live within seven months. The shift unlocked improved visibility, better process control, and confidence in data integrity.

Case D: Strategy-First Approach in a Fragmented Services Organisation

A rapidly growing services provider was juggling multiple legacy systems. Manual reporting, inefficient processes, and a fragmented customer experience were hindering growth.

Instead of rushing into software procurement, the organisation partnered with SMC to develop a comprehensive digital strategy. Together, we co-designed a future-state roadmap aligned with business readiness and risk appetite, enabling phased investment while managing transition risk.

Why Many Legacy Replacements Fail

While the logic of replacing legacy systems is clear, execution is where most organisations stumble. In our experience, failures often share these root causes:

• Lack of strategic alignment on the business outcomes driving the replacement.
• Premature or politically influenced technology decisions.
• Underinvestment in change management and staff readiness.
• Insufficient experience managing large, complex system transitions.

Replacing a legacy system is not simply a technical project, it’s a business transformation that must be led accordingly.

What Successful Organisations Do Differently

In contrast, successful transformations share several key attributes:

• Clarity of purpose: Technology change is rooted in strategic business drivers.
• Stakeholder alignment: Executives and teams understand and own the journey.
• Structured selection: Tools, processes, and criteria guide unbiased decision-making.
• Change leadership: Internal capability is supported and developed throughout.
• External expertise: Skilled advisory partners provide rigour and confidence in high-risk moments.

These projects aren’t just well executed – they’re positioned to deliver lasting value.

The Bottom Line

For many organisations, legacy systems have become the weakest link in their operating model. The longer they remain in place, the more they hold back growth, erode confidence, and expose risk.

If your organisation is still running critical functions on outdated technology, the time to act is now – before the next audit, system failure, or market shift forces your hand.

Digital transformation isn’t about shiny new tools. It’s about ensuring your systems are fit for purpose, aligned to your goals, and ready for what’s next.

About the Author

Rob Stummer is Director of Growth at Solution Minds Consulting (SMC), Australia’s leading independent ERP and enterprise transformation advisory firm. A former CEO and Managing Director with over 25 years of experience in enterprise technology, Rob has led large-scale digital transformations across Asia-Pacific, Europe, and North America. He is a trusted advisor to boards, CIOs, and private equity firms on ERP strategy, complex program recovery, and system modernisation. Rob brings deep expertise in scaling enterprise platforms, driving operational efficiency, and unlocking long-term business value through technology.

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