Many companies want to integrate AI quickly, but their outdated systems are a major brake on those ambitions.
Research by Cognizant among 2,000 managers worldwide shows that AI has become one of the main reasons to modernize legacy systems. This puts modernization higher on the agenda, but organizations are struggling with implementation.
AI drives modernization pressure
According to the research, 85 percent of managers fear that existing technology hinders their ability to use AI effectively. This creates extra pressure to renew systems faster. At the same time, 78 percent of respondents indicate that they want to complete the modernization within two years. The ambition is great, but many organizations face a significant technical debt that makes this pace difficult.
Managers expect to renew both front and back office systems within two years. However, the reduction of technical debt lags behind. In fact, 79 percent think that they will not have eliminated even half of that debt within five years.
Complex systems
The modernization route proves to be complicated. 63 percent of respondents cite the complexity of existing systems as the biggest obstacle. In addition, shortages of critical personnel (50%) and capital (48%) arise. As a result, modernization programs often proceed more slowly than planned and remain fragmented.
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Financing innovation with savings on old technology also proves difficult. Many organizations discover that the expected savings are realized later or are lower than budgeted. As a result, the gap between plans and feasibility continues to grow.
Saket Gulati, SVP and Managing Director Northern Europe at Cognizant, says that organizations must make clear choices in which parts they modernize and when. According to him, this helps to realize the desired efficiency and productivity gains and to make AI more widely applicable.