Modern businesses rely on the ability to move quickly, adapt easily, and stay competitive. But many organisations are still running on IT systems that weren’t built for today’s pace. These legacy platforms may appear to function well enough, but behind the scenes, they often carry hidden costs, inefficiencies, and growing risks that directly affect business performance.
For CFOs, outdated technology is no longer just an operational concern. It’s a financial issue that impacts productivity, risk exposure, and long-term growth potential.
Why legacy systems create more risk than value
Legacy systems usually remain in place because they still do the job. They process transactions, store data, and support day-to-day operations. However, as the rest of the business evolves, these older platforms become harder to integrate, more expensive to maintain, and increasingly limited in what they can offer.
In many organisations, outdated systems are the root cause of duplicated work, manual processes, and delays in decision-making. Teams waste time re-entering data or switching between tools that don’t connect. The cost of these inefficiencies builds gradually but consistently.
The burden of maintaining legacy systems also grows with time. Older platforms often require specialist knowledge, rely on unsupported infrastructure, or lack critical security updates. Support costs increase, flexibility decreases, and the risk of a serious issue rises.
There’s also the opportunity cost to consider. When systems can’t scale, can’t connect to modern tools, or can’t support customer expectations, they limit the organisation’s ability to grow and compete. Whether it’s missing out on automation, better insights, or digital service delivery, outdated technology holds the business back in ways that can be hard to measure, but easy to feel.
The risk of waiting too long
Many businesses avoid addressing legacy systems because change feels disruptive or expensive. But waiting often makes things worse.
The longer a system stays in place, the more complex and costly it becomes to replace. Data gets locked in, dependencies multiply, and the risk of failure increases. When a system eventually breaks or becomes non-compliant, the business may be left with limited options and very little time to respond.
There’s also a growing compliance risk. Regulations around data privacy, security, and reporting are tightening. Legacy systems that can’t meet modern standards can create audit issues, legal exposure, and reputational damage—none of which are easily absorbed.
For CFOs, the risk isn’t just theoretical. It shows up in increased operating costs, insurance complications, delayed projects, and missed growth targets. In some industries, outdated technology can even affect valuation or investor confidence.
Modernisation doesn’t have to mean disruption
Replacing old systems doesn’t always require a full rebuild. The most effective IT modernisation strategies are often phased and prioritised based on business value.
For financial leaders, this means working closely with CIOs to understand where the risks and inefficiencies are greatest, and where investment can deliver meaningful outcomes. That might mean consolidating platforms, migrating specific functions to the cloud, or automating high-friction processes.
Modernisation is most successful when it’s treated as a business improvement program—not just an IT project. When CFOs view it through the lens of cost reduction, risk mitigation, and scalability, the case becomes much clearer.
Building the right case for change
The business case for modernisation should focus on what matters most to the organisation: productivity, efficiency, security, and growth. It should also highlight the cost of inaction, not just the cost of implementation.
This includes rising maintenance expenses, increasing downtime risk, and the drag on business performance caused by outdated systems. These costs may be buried across teams or budgets, but they add up and they can often be reclaimed through smart technology investment.
It’s also important to consider how modernisation will shift the financial model. Moving from capital-intensive infrastructure to subscription-based cloud services may require new ways of thinking about budgeting, forecasting, and reporting. These shifts can offer more flexibility and scalability, but they need to be planned for.
The CFO’s role in leading modernisation
Modernising IT is not just about upgrading software. It’s about creating the foundation for a more resilient, efficient, and agile business. That requires strong financial leadership. CFOs are uniquely positioned to lead this conversation. They understand where value is created, where risk is hiding, and how to align investment with business strategy. By engaging early, asking the right questions, and ensuring governance is in place, CFOs can help their organisations modernise with clarity and control.
Technology will continue to evolve whether the business is ready or not. For organisations that want to keep up—let alone lead—modernisation is not optional. It’s a necessary step toward sustainable growth.
