Articles

Modernization decisions that matter: A C-suite framework for legacy portfolios in 2025

- Shreya Kapoor

Most enterprises are already deep into modernization. The question that lies ahead is no longer whether to modernize, but where actually does modernization deliver measurable business value and where changes create unnecessary risk. 

In 2025, over 60% of organizations still rely on legacy platforms for mission-critical operations. Mainframes and long-standing systems continue to be strategic assets:  71% of Fortune 500 companies still run mainframes, and nearly 90% are modernizing them in place, not abandoning them. This clearly states that legacy isn’t disappearing; it’s evolving, and leadership teams must now decide how aggressively to reshape technology portfolios without destabilizing the enterprise. 

This article aims at providing a decision lens for business executives, focusing on risk, ROI, cost predictability, workforce evolution, and compliance impact rather than technical pathways. 

The real risks affecting enterprise portfolios 

Modernization decisions fail when attention is placed on technologies rather than system behaviors. Four risks repeatedly surface across regulated and high-scale industries include: 

1. Silent degradation 

Legacy systems rarely fail visibly; they decline quietly. 

Symptoms include:

  • Gradual latency increases 
  • Expanding batch windows 
  • Misaligned definitions of customer/order/policy across systems 
  • Erosion of capacity buffers due to regulatory demands or analytics workloads 

By the time SLAs breach, observability is already compromised. For this reason, legacy reliability has become a business priority, not an engineering concern. 

2. Architectural entropy 

Enterprises are adding modern components faster than they can retire from legacy ones. 

Entropy grows when: 

  • UI moves to cloud, but core logic stays on-prem 
  • Multiple runtime generations coexist 
  • Each “era” of the stack requires different pipelines, patterns, and security models 

Entropy, not old technology; is the primary driver of cost, risk, and slow change.

3. Cloud mismatch and data gravity 

Not all workloads benefit from cloud-native execution. Heavy batch processing, I/O-intensive tasks, and regulated data estates often perform more predictably on existing platforms. Moving large data stores across regions or clouds creates surprise egress costs and operational complexity. 

4. Cost volatility 

Boards now ask about cloud cost governance and generative AI spend in the same conversation. 

Major studies show:

Any modernization plan must demonstrate cost predictability, not only cost reduction. 

A C-suite decision lens: Operational, financial & compliance risk + growth & productivity potential

Rather than evaluating “rehost vs replatform vs refactor,” the leadership conversation should pivot to three systemic lenses. 

1. Operational risk 

Definition: System Entropy is the inconsistency in runtimes, frameworks, integrations, and deployment processes. 

Why it matters: High entropy increases change-failure rates, complicates audits, and raises compliance exposure. 

Indicators: 

  • Multiple framework versions in production 
  • Bespoke integrations (file drops, custom bridges) 
  • Long lead times for small changes 

2. Financial & compliance risk 

Definition: Data Gravity is where the most critical and regulated data naturally resides and where analytics/AI workloads operate. 

Indicators: 

  • High egress or replication costs 
  • Multiple data copies feeding reporting and AI 
  • Latency-sensitive digital channels relying on distant data stores 

3. AI-readiness (Growth & productivity potential) 

Definition: Ability of a system’s data and logic to support AI copilots, predictive models, and intelligent automation. 

Indicators: 

  • Clean domain APIs 
  • Documented lineage and access controls 
  • Clear AI-dependent business cases 

These three dimensions reveal where modernization yields outsized business value and where migration risk outweighs benefits. 

Mapping modernization to executive outcomes 

The C-suite does not need granular architecture diagrams; it needs patterns tied to ROI, risk reduction, cost predictability, and compliance outcomes. 

1. Rehost (Stabilize and extend asset life)

Use when:

  • Entropy is low–moderate
  • Data remains primarily on-prem
  • AI value is minimal for the next 24–36 months

Executive value:

  • Reduced operational risk from aging hardware
  • Predictable cost modeling
  • Quick stabilization without redesign
  • Workforce continuity while planning long-term modernization

2. Replatform (Optimize around data & operation)

Use when:

  • Entropy is moderate
  • Data gravity is shifting to a cloud region or analytics environment
  • AI-readiness matters but does not drive real-time workflows

Executive value:

  • Lower run-rate costs
  • Fewer outages
  • Standardized integrations and APIs
  • Improved support cycles and operational simplicity

3. Refactor / Re-architect (When agility & intelligence drive value)

Use when:

  • Entropy is high
  • Data movement is costly or fragile
  • AI is strategic to revenue, risk, or customer experience
  • Regulatory exposure is tied to legacy constraints

Executive value:

  • Faster market response (pricing, onboarding, offers)
  • Stronger compliance position
  • Reduced exposure to talent scarcity
  • Direct enablement of AI-driven growth

Many organizations simplify modernization by using low-code integration accelerators for API generation and event-driven transitions. Platforms such as Torry Harris Tekton+ support this approach by automating legacy integration modernization and reducing dependency on custom ESB patterns; a key entropy driver. 

Additionally, Torry Harris Convergent and GenAI-based accelerators provide assessment, dependency discovery, and code analysis capabilities that shorten modernization timelines while improving documentation and governance. These tools support enterprise-scale modernization without requiring wholesale rewrites. 

Workload profiles: A more useful classification for executives 

CIOs are more likely to benefit more if they can avoid “monolith vs microservices” discussions. 
And maybe try to classify by workload behavior, because that determines risk and ROI. 

1. High-I/O, Batch-heavy systems 

Settlement runs, billing cycles, and regulatory reports.

Bias: Modernize in place; optimize integration and governance. Refactoring yields minimal ROI unless data gravity shifts. 

2. Low-latency, High-concurrency systems 

Customer-facing APIs, authorization engines, and trading platforms. 

Bias: Replatform or refactor near digital channels. 

3. Analytics & AI/ML domains 

Where lineage, copies, and GPU usage matter. 

Bias: Data-first modernization before application rewrites. 

4. Systems of record with low change velocity 

ERP cores, policy admin systems. 

Bias: Stabilize, wrap, expose APIs, apply selective refactoring. 

Data-first ROI: The most underestimated factor in modernization 

Most business cases overemphasize compute changes and underestimate data movement, lineage risk, and regulatory impact. Executives should evaluate:

1. Egress and replication costs 

Model normal and peak usage. Include ML training cycles, pulling full history. 

2. Lineage risk 

Multiple ungoverned pipelines increase incident probability. 

Standardization significantly reduces regulatory impact. 

3. Compliance-by-design 

Modernization is an opportunity to embed controls, not bolt them on later. 

A practical checklist  

Executives should try to ensure every modernization proposal answers these questions: 

1. Portfolio clarity

  • What is the entropy score per domain?
  • Where does core data live today and where should it live in 5–7 years?
  • What systems carry the highest regulatory blast radius?

2. Financial & risk modeling

  • How does each modernization path change operational risk?
  • How does it alter cost predictability (not just cost levels)?
  • What agility gains (lead time, cycle time) are expected?

3. Data governance

  • Does the plan reduce data copies and undocumented flows?
  • Are lineage and access controls embedded from Day 1?

4. Tooling & workforce strategy

  • Are tools standardized across the enterprise?
  • Does the approach reduce SME dependency and talent risk?

5. Compliance & security posture

  • How does each modernization wave improve auditability?
  • Are risk, compliance, and technology jointly accountable?

The leadership shift 

Modernization discussions must evolve from: 

“Should this move to cloud?” 

to 

“Does this decision reduce entropy, respect data gravity, and increase AI-readiness with acceptable risk and NPV?”

This framing turns modernization from a technology program into a portfolio optimization strategy; one that CFOs, CIOs, CISOs, and risk leaders can jointly endorse. 

Reach out to us today to find out more about how Torry Harris can support Modernization for your organization. 

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About the author

Shreya Kapoor

Senior Content Strategist