Staying competitive and innovative is critical to business success. Cloud technology is here to assist businesses in improving access, comprehending complex data, and providing higher security. With agility being the need of the hour, it is not too much to say cloud computing will remain powerful and expansive as it portends to be.

Moving to the cloud-based IT environment

Cloud revenue is expected to reach $474 billion in 2022, up from $408 billion in 2021, surpassing non-cloud revenue in the IT sector in the next three years ^[1]. Furthermore, it is expected that by 2025, over 95% of new digital workloads will be implemented on cloud-native platforms, projecting a 60% increase from 2021. Cloud technology indeed remains at the heart of emerging digital experiences.

This transition is reported to be further accelerated after the spread of Covid-19. Back in March 2020, 43% of organizations surveyed had no plans to transition to the cloud entirely. However, due to the COVID-19 outbreak, 48% have streamlined their cloud migration plans, and roughly 36% aim to use cloud technology to digitize more of their processes ^[2].

Many legacy systems are built using out-of-date technologies that lack the speed, agility, and ability to adapt and integrate with more modern, next-gen technology creations. Maintaining, updating, improving, or migrating its whole system is complicated and charged at a high cost. A legacy system may contain one or more of the following problems:

• Weak security due to out-of-date security measures exposes the system to malicious data breaches.

• Expensive maintenance creates more redundancies and inefficiencies. Such upkeeping requires particular expertise, extensive time, and efforts to maintain.

• Data silos exist because outdated frameworks were not designed to connect with new systems, nor transmit data from one system to another. It is impossible to extract values from data.

• Lack of integration and compliance as the firms are unable to profit from API vendors. Failure to comply with industry regulations in heavily regulated sectors could result in millions of dollars in fines.

• Missed opportunities also result from a business' inability to swiftly react to the ever-changing market and expectations. Scare-up digital tactics, long time-to-market, and a lack of innovation can all impact a company's long-term profitability.

Benefits of running business in the cloud

As IT professionals are constantly exploring creative methods to do more with less: managing teams, stretching budgets and making the most of infrastructure and applications, they are turning to the wide-reaching benefits of the cloud.

• Reduced costs: Before cloud technology, companies had to pay for on-site servers or off-site data centres. Cloud technology allows your organization to pay a hosting company rather than hosting the servers in-house, which saves space and money. According to a BCG analysis, moving to the cloud can help businesses save between 15 and 40% on infrastructure costs ^[3].

• Improved data security: Data kept in the cloud is encrypted, making it safer than data stored on other types of servers. Furthermore, businesses can address the latest cybersecurity concerns because cloud technology is frequently innovated and is more robust against attacks than off-site servers. Moreover, cloud hosting firms provide several security alternatives, like firewalls, tokenization, and virtual private networks, which spare organizations from fixating budgets on in-house security, such as VPNs.

• Operational flexibility: Many cloud technology providers offer a pay-as-you-go service model, allowing enterprises to scale flexibly according to their business models. In the everyday workspace, cloud technology is likely best recognized for bringing employees and teams together while eliminating duplications and limiting errors. Team units can synchronize and save updates by allowing users to work on projects simultaneously. There is no need to submit hundreds of different versions of the same document because cloud technology always displays the most recent.

Legacy-to-Cloud approaches

• Rehosting: This "lift-and-shift” approach is one of the legacy modernization methods that allow legacy programs to run in the cloud without coding or architectural changes. Some code components can be rewritten, and the application's database interaction can be changed if necessary. For starters, this is a quick method to stop using MIPS (million instructions per second) and start using cloud alternatives suitable for migrating large-scale applications.

• Replatforming: Replatforming, or "lift-and-shape”, rewrites the app's code from the ground up. Replatforming legacy software is significantly more complex than simply rehosting, as the development team must first analyze the old app's logic. A successful replatform migration requires proper business process analysis, which necessitates active client participation and investment in basic automation that provides flexibility in management. This method allows firms to preserve the primary values of their software while leveraging cloud capabilities to scale.

• Refactoring (or rearchitecting): Rebuilding legacy software entails reconstructing the app's components to improve the current design. Complete rebuilding allows businesses to adjust their system to the new requirements, making significant changes while reaping all of the benefits of custom software development. Suppose the majority of the historical system components are still functional. In that case, businesses can partly rebuild them to save money on the project. In this situation, a development team holds the most valuable components and replaces them with new ones. Such practice establishes an entirely new and modern technical side to a product while also modernizing all business procedures.

When standing at this crossroads with three possible paths to modernize legacy software, it's critical to know when each cloud strategy is employed and what advantages each offer.