9.26 min to readApplication Services

What is Application Modernization?

SoftwareOne blog editorial team
Blog Editorial Team

Many companies run on applications that were built six or more years ago. As part of these organizations’ core systems, they contain valuable data, support workflows and teams, and help drive the company forward.

Today, organizations want more from their applications. Employees want more agility in the ways that they work. Customers expect better experiences from those they do business with. And IT managers wish their solutions were more resilient and cost less to maintain.

Yesterday’s solutions cannot support these evolving needs. They were built with the tech of their time, designed to run within on-premises data centres. Outmoded architectures and programming languages make it difficult to enhance and maintain these aging applications, causing a significant drain on IT resources.

Moving to the cloud offers multiple benefits. It increases business agility, reduces costs and security risks, boosts availability and performance, and makes years of accumulated business data accessible for new insights and automation. Moving to the cloud is also an opportunity to modernize to reduce legacy inefficiencies and technical debt, clearing the way for innovation and building new capabilities for the business.


According to Microsoft, “application modernization is the process of updating an organization’s existing apps to a cloud-first model – sometimes called legacy modernization. If an organization uses on-premises apps, modernization may involve migrating those apps to a public, private or hybrid cloud.”

Amazon Web Services (AWS) says application modernization “involves a multi-dimensional approach to adopt and use new technology, to deliver portfolio, application, and infrastructure value faster.” AWS believes that application modernization helps organizations scale their applications at an optimal price.

According to Google, application modernization is about “promoting faster, secure software development with a tailored set of proven DevOps practices and open-source-based application platform and tools.”

While all this sounds exciting, it can be overwhelming for most IT leaders.

SoftwareOne's definition is simple:

We believe that application modernization refers to changing application source code and architecture to leverage cloud platforms and native services. Doing so enables business agility, optimizes costs, and improves development practices and speed. In essence, making the cloud the real cloud.

Companies want to work with a partner who can look at their application portfolio, help them create a plan, migrate and modernize what makes sense, optimize their cloud spend, and help their employees improve their skills and practices along the way.

The 7 Rs of optimized cloud adoption

Application modernization can mean different things to different people. At SoftwareOne, we use a concept called the 7 Rs to facilitate conversations about the decisions businesses can make to assess and modernise applications. Our model is based upon similar migration strategy descriptions from Gartner and AWS.

Pathways for Cloud Adoption, source: SoftwareOne

Getting onto the cloud quickly

Sometimes it’s necessary to move fast. Whether this is because of internal politics or a push to divest from data centres, the following strategies can help get a company onto the cloud efficiently while setting it up for more thorough optimization later on.

Rehosting is a practical option. Otherwise known as lift and shift, this involves moving applications from their physical servers to virtual machines in the cloud. It requires little, if any, significant change to the underlying code, but it does mean the applications will have many of the same limitations as they did on-premises.

Nevertheless, it can be a good option for companies that need to get on the cloud quickly.

A second option is relocating. This term refers to transferring a large number of servers from an on-premises platform to the cloud version of that platform. Relocating is rapid and does not require architectural or code changes.

Replatforming is also a possibility for getting onto the cloud quickly. It requires making only minimal changes to move an application to the cloud. Automated replatforming is mostly done with simple applications but can also act as an intermediate step. With this approach, companies can reduce costs by hosting their migrated applications on a shared platform instead of a reserved virtual machine.

Modernising more thoroughly

Modernising applications and workloads requires more effort, but it enables companies to take full advantage of the cloud’s benefits.

Refactoring involves making greater changes to an application depending on its actual state and modernization drivers. For example, an application could be tweaked slightly to take it to the cloud while reducing technical debt. Or, a business could decompose a monolithic application to improve scalability and maintainability or solve performance and security issues, among other objectives. There is no one-size-fits-all solution in refactoring, so it is important to define a clear heavy, medium, or light scope.

Ultimately, the goal is to have a more cloud-native application, considering that refactoring can be done all at once or iteratively — allowing companies to gradually reduce their technical debt and legacy inefficiencies.

In-house strategies

Repurchasing is a straightforward modernisation strategy that involves either buying a SaaS software product to replace a custom application completely or moving an application’s architectural components from traditional use licences to newer versions or third-party equivalents in the cloud. This strategy essentially trades a high degree of customisation for low maintenance costs, making it a smart financial choice for applications that are not tied to a competitive advantage.

Alternatively, teams can decide to retire specific applications. These applications are decommissioned because they generally no longer serve any business need, either because they have aged out or the business has changed.

In-house teams often choose to retain applications as a more straightforward strategic approach. This option is meant for applications or workloads that function better in the current on-premise environment. It may be preferable when there are highly regulated workloads or significant privacy concerns.

Do companies need a partner when modernizing their applications?

Working with an experienced cloud solution services partner is essential for most companies. A technology services team can bring deep expertise, repeatable assets, and automated tools that in-house teams do not have, getting you to outcomes more quickly. A partner can also help you create a vision and a roadmap for your application portfolio’s future state – one built with business goals and current technical constraints in mind. As a result, the modernization project is de-risked through a strong business case and thorough discovery and assessment.

Finally, it is important to remember that a top partner has been involved with many projects and has had an opportunity to see the results of application modernization at scale. They can guide customers starting this journey to think about automation, data governance, security, costs, and other levers in the early stages.

Case study: City of Frankfurt

The City Government of Frankfurt, Germany relied on bespoke development of its business-critical applications. When end-of-life support for the technology within those apps neared, the city turned to SoftwareOne to rebuild its application portfolio and reduce technical debt and unnecessary IT expenses. Six applications were rapidly modernized and adapted to current business and security requirements, making the work of the city administration more cost-efficient, secure, productive, and user-friendly.

Read more

Building an application modernization strategy

According to McKinsey, CIOs recently said that “10 to 20 percent of the technology budget dedicated to new products is diverted to resolving issues related to tech debt. More troubling still, CIOs estimated that tech debt amounts to 20 to 40 percent of the value of their entire technology estate before depreciation.”

There is no doubt that application modernization is critical. Without it, organizations tend to waste up to 32 percent of their cloud spending, according to Flexera.

Modernization is an investment in your future but has the potential to interrupt business as usual if not well-planned and executed. Partnering with an expert advisor is a significant first step. At SoftwareOne, we have a pragmatic approach to optimized cloud adoption and provide flexible services to help you accomplish your goals wherever you are in the journey.

With global reach, end-to-end services, and strong partnerships with Microsoft, Amazon Web Services, and Google, SoftwareOne delivers on the promise of cloud. Unlike other cloud solution services partners, SoftwareOne is a leader in software and cloud financial management. We’ll show you how to make your current IT investments count while bringing your business forward.

Modern platforms, applications, and practices

A realistic and sustainable cloud strategy accelerates development, strengthens security, reduces costs, and improves performance and resiliency. Are you getting all you can out of cloud?

Modern platforms, applications, and practices

A realistic and sustainable cloud strategy accelerates development, strengthens security, reduces costs, and improves performance and resiliency. Are you getting all you can out of cloud?


SoftwareOne blog editorial team
Blog Editorial Team