Many businesses continue to operate on legacy IT systems because they still appear to function. They support daily operations, hold critical data, and haven’t caused major issues yet. However, as technology and business needs evolve, that sense of stability can become misleading. These older platforms are often deeply embedded and seem too complex or risky to replace, so they remain. Over time, however, they become harder to maintain, less compatible with modern tools, and increasingly costly.
In most cases, legacy systems aren’t just inefficient, they actively limit business performance. Teams waste time on manual workarounds, re-entering data, and operating within disconnected systems. This creates friction, slows down service delivery, and increases the risk of errors. While these issues might not be visible on a balance sheet, they affect productivity, morale, and customer experience. And the longer they’re left unaddressed, the harder they are to fix.
Financial Risk Hides in Maintenance, Delays, and Downtime
What starts as minor inconvenience can become a major cost. Maintaining outdated systems often requires specialist knowledge, manual effort, or unsupported infrastructure. These demands place extra burden on IT teams and result in escalating support costs. As the business becomes more reliant on digital processes, any weakness in core systems can turn into a bottleneck.
There’s also the risk of failure to consider. Legacy platforms are more likely to experience downtime, outages, and compatibility issues. These incidents cost money, reduce trust, and can disrupt operations for days. In some cases, the true financial impact is only clear after an urgent fix or last-minute replacement is needed. This is usually under pressure, with limited options.
Compliance and Security: The Hidden Exposure
As cybersecurity threats grow more sophisticated and regulatory standards tighten, older systems are increasingly vulnerable. Many lack up-to-date security protocols or can’t meet current compliance obligations. When a system can’t support modern encryption, access controls, or audit logging, it becomes a liability.
For CFOs, this represents a serious exposure. A breach linked to an outdated system doesn’t just carry technical consequences. It can lead to fines, insurance complications, reputational damage, and even legal action. It also raises difficult questions about governance, accountability, and oversight especially if the risks were known but not addressed.
Delaying Modernisation Creates Bigger Problems
One of the biggest risks of legacy IT is that it becomes harder to change the longer it’s in place. Systems become entangled with processes, dependencies grow, and the idea of replacing them feels more daunting over time. Yet delaying that change only compounds the problem. What starts as a manageable project becomes an expensive, business-critical initiative and often one that can’t wait any longer.
Waiting can also limit your options. Vendors may discontinue support, key staff may leave, or an urgent compliance requirement may force a rushed implementation. In all cases, the business ends up reacting under pressure instead of acting with strategy.
A Smarter, Phased Approach to IT Modernisation
Modernising your IT environment doesn’t have to mean replacing everything at once. In fact, most effective strategies start with clear priorities. Businesses can target the most at-risk or high-impact systems first, consolidating where possible and introducing cloud-based solutions where flexibility is needed.
This requires collaboration between finance and technology leaders. CFOs play a critical role in helping identify where technology is holding the business back, where the risks are most significant, and where investment will deliver measurable returns. Modernisation should be viewed as a business improvement initiative and not just a technology upgrade.
The CFO’s Role in Driving Better IT Outcomes
Technology strategy is no longer separate from financial strategy. From budgeting and forecasting to risk mitigation and operational resilience, CFOs are central to making IT decisions that create value. That means asking hard questions about outdated systems, understanding the true cost of doing nothing, and ensuring modernisation plans align with business goals.
It also means preparing for financial change. As businesses move from capital-heavy infrastructure to subscription-based services, financial models shift. CFOs need to plan for flexibility, ensure accountability, and adjust reporting to reflect new operating environments.
Modern IT Enables Modern Business
Legacy systems may still work, but they rarely work well enough to support long-term success. They slow growth, increase risk, and create unnecessary complexity. For forward-thinking organisations, modernisation is about removing the roadblocks that hold your business back.
Now is the time to look ahead, not just at what your systems do, but at what they could enable. Because in today’s environment, “good enough” is often the biggest thing standing in the way of something better.
Want to go deeper?
Download the CFO’s Guide to IT to explore how modern technology decisions can drive better financial outcomes, reduce risk, and unlock smarter growth: https://corpit.net.au/cfo-guide-to-it/
