How Much Could Outdated Software Cost Your Business

Even the biggest companies can fall victim to an invisible enemy—outdated software. 

It’s the systems you rely on daily, quietly showing their age as the technology around them moves forward. You might not notice it immediately, but every glitch, every slowdown, and every workaround is a sign of a deeper issue that could be holding your business back.

And you’re not the only one. Up to 70% of Fortune 500 companies operate on software developed over two decades ago.

It’s easy to ignore the problem. After all, the software still works, right? But the hidden cracks—missed opportunities, frustrated users, and growing inefficiencies—are where the real damage eventually happens.

This goes beyond technology—it’s a core strategic issue.

Let’s unpack why outdated software persists, what’s at stake, and why addressing it could be your smartest business move this year.

What is Outdated Software?

Let’s get to the heart of the problem.

Outdated software isn't just old. It can no longer meet your business needs, lacks support, and fails to integrate smoothly with newer technologies.

Often, it's software that hasn't been updated or significantly improved in many years.

It can occur across different layers of your IT infrastructure, from single applications to complete operating systems. Each outdated application or system layer may seem minor on its own, but collectively, they can compound to create significant efficiency drains.

But, as we all know, keeping your software up-to-date ensures you're taking advantage of the latest improvements and staying ahead in the efficiency game. Ignoring these outdated systems poses a serious threat that can cripple your operations and erode your competitive edge.

So, why are so many businesses still clinging to these obsolete technologies?

Why Companies Still Use Outdated Software?

Before diving into specific reasons, it's important to mention that the decision to stick with outdated software is rarely straightforward.

Many businesses struggle between the comfort of familiar systems and the daunting challenge of upgrading.

Some have even tried switching, only to face multiple major setbacks. That would make anyone hesitant to try again.

This hesitation is often rooted in a deep reliance on legacy systems that, despite their inefficiencies, have supported the company's operations for years. Overhauling these systems evokes concerns about potential data loss, significant training requirements for staff, and the fear of operational downtime during the transition.

Additionally, many companies operate under the "if it isn't broken, don't fix it" philosophy. The comfort of familiar processes often outweighs the benefits of new implementations, thus making the push for change that much harder.

Understanding the full scope of impacts—both sticking with old software and transitioning to new—can help clarify the decision-making process and illuminate the path forward.

The Hidden Costs of Outdated Workplace Software

Outdated software does more harm than most businesses realize. It’s a silent drain on your budget, your team’s productivity, and your ability to compete in today’s market.

From skyrocketing maintenance costs and security vulnerabilities to missed opportunities for innovation and falling behind on compliance, sticking with old systems comes at a steep price.

Let’s take a look at how outdated software might be slowing you down and how we can work together to find a better way forward.

Financial cost 

The problem

Did you know that old software systems could be eating up to 55% of your IT budget? That’s right—more than half of your technology spending might just be going toward keeping outdated systems limping along.

Funds that could otherwise fuel innovation and growth are just keeping old tech on life support—tech that can't keep up with the competition or meet today’s market demands.

The consequence is a vicious cycle: the more you spend on maintaining old systems, the less you invest in forward-thinking projects that drive business value and technological advancement.

How to move on

Think about it: investing in modern software does more than reduce those hefty maintenance costs—it capitalizes on technology that scales and evolves with your business needs. 

When you upgrade your software, you're making a strategic shift. You get faster, more reliable systems that directly support your financial goals, enhancing cost-efficiency for the long haul.

Here’s how to get started: 

Start with a Tech Check-Up: Look at what you’ve got tech-wise. Ask yourself, which systems are eating up your budget? Finding these financial drains is your first move toward better spending.

Set Your Financial Tech Targets: Think about the financial perks you want from your new software. Are we talking about automation to cut down on costs? Or maybe sharper data analysis for smarter decisions? Lay out your financial goals clearly before you start shopping around.

Scope Out the Best Financial Fits: There’s a ton of off-the-shelf software out there, but not all of it will give you a bang for your buck. Take your time to sift through the options—compare what they do and how they’ll impact your bottom line. You’ll want to go for software that has features that are both functional and cost-effective.

Plan Your Financially Savvy Rollout: Upgrading your software is a big deal financially. Don’t rush it. Plan this out carefully to make sure it’s worth every penny and disrupts your operations as little as possible. Rolling out in phases might help spread out the costs and let you adjust as you start seeing the financial upsides.

Train Your Team for Financial Efficiency: New tools are great, but they’re only as good as the people using them. Make sure your team gets the training they need to really leverage these new systems to save money and boost efficiency.

Security risks

The problem

Did you realize that sticking with old software costs a fortune and also exposes your data to significant risks? Outdated systems are perfect targets for hackers—they often lack the latest security features and updates.

Every day you rely on outdated tech, you risk data breaches that could devastate your finances and reputation. According to IBM's Cost of a Data Breach Report 2024, the average data breach cost in 2024 was USD $4.88 million. 

The consequence is the long-term impact on customer trust and business continuity. When security lags, the disruption can be massive, way beyond the cost of a few updates.

How to move on

Upgrading your software means beefing up your defenses. Newer systems come equipped with the latest security measures that protect against emerging threats.

Updating also boosts efficiency and secures your business’s future.

Here’s how to get started:

Assess Your Security Needs: Take a close look at your current tech. What’s missing? End-to-end encryption? Robust firewalls? Identifying these gaps is your first step toward a more secure setup.

Define Your Security Goals: What level of security do you need? If you handle sensitive information, an off-the-shelf solution might not cut it.  Figure this out before opting for a generic solution.

Choose Secure Solutions: When evaluating new software, go for those with a strong track record for security. Opt for solutions that provide regular updates and robust defenses against cyber threats.

Implement a Secure Transition: Keep your data safe as you upgrade. This might involve extra safeguards or consulting with security experts to guide the transition.

Educate Your Team on Security Practices: A secure system thrives on informed users. Train your team thoroughly on the new security features to ensure everyone is equipped and alert.

Operational and System Vulnerabilities

The problem

Legacy systems are notorious for their inefficiencies and vulnerabilities. The average time to remediate critical vulnerabilities is a lengthy 65 days, during which your business is wide open to security threats and operational disruptions.

Plus, outdated software struggles to mesh with new technologies, which stunts your ability to scale and adapt to changing market demands.

Ever tried integrating modern tech like IoT or AI with old software? It's a tough gig. Since these systems weren’t built for platforms like AWS, they tie you to legacy vendors, and scaling becomes more trouble than it’s worth.

How to move on

Think of upgrading your systems as giving your business a tune-up. It’s essential for keeping everything running smoothly and making sure you can jump on new opportunities without a hitch. 

Plus, it keeps you right up there with—or even ahead of—the competition.

Here’s how to get started:

Evaluate Your Tech Stack: Really dig into what you're currently working with and identify where the bottlenecks are. Which systems are holding you back from adopting new tech?

Plan for Scalability: Choose solutions that offer flexibility and growth potential. Consider cloud compatibility and how easily new features can be added as your needs evolve.

Consider the ROI of Upgrading: Remember, the projected ROI of upgrading your software is significant—up to 100% by avoiding the pitfalls of obsolete tech that’s at the end of its life.

Prepare for Regulatory Changes: Stay proactive about potential regulatory changes and market shifts. Up-to-date software keeps you ready to pivot and meet new challenges head-on.

Shift Your Mindset: Letting your software grow old is like sabotaging your success. Imagine your software as a living organism, always growing and adapting, not just a static tool.

Innovation Roadblocks

The problem

Outdated software puts a hard stop on your ability to innovate. It’s tough to keep up with trends like AI or automation when your software isn’t built to handle them. 

Without the right tools, you’re missing chances to grow, improve customer experiences, and stay ahead of the competition. Falling behind means losing ground in a market that’s moving faster daily. 

Breaking through these roadblocks starts with upgrading to software that’s ready for today’s challenges and tomorrow’s opportunities.

Here’s how to get started:

Keep Your Software Current: Dedicate a portion of your IT budget—around 30%—to regular updates and continuous development. Staying up to date keeps your systems ready for what’s next.

Focus on Innovation Goals: Think about where you need to grow. Is it AI, automation, or something else? Set clear priorities so your upgrades help you stay ahead in your industry.

Choose Flexible Systems: Choose software that grows with your business. The right solution offers flexibility to adapt to your needs, scaling effortlessly as you expand and sparing you the hassle of constant overhauls. 

Get Your Team Involved: Make innovation part of your culture. No one knows your systems and users better than the people working with them every day. Give your teams the tools they need, hear their ideas, and encourage them to find smarter, more effective ways to improve and innovate.

Track Your Progress: Once you’ve upgraded, keep an eye on its performance. Are you moving faster? Delivering more value to customers? Use what you learn to keep improving.

Customer Satisfaction and Compliance Risks

The problem

Customer expectations aren’t the only demands businesses need to meet—regulatory requirements are just as critical. From GDPR compliance to cookie policies, staying on the right side of the law means your software needs to be up-to-date and reliable. Outdated systems often lack the flexibility or features to handle these requirements effectively, exposing businesses to fines, legal troubles, and reputational damage.

On the customer side, outdated software frustrates users with clunky interfaces, slower load times, and limited functionality. When customers can’t get what they need quickly and seamlessly, they’re more likely to move on to competitors who can deliver a better experience. 

Both customers and regulators expect businesses to keep up, and failing to do so can harm your reputation and bottom line.

How to move on

The key to meeting market and regulatory demands is ensuring your software is up-to-date, secure, and aligned with current standards.

Here’s how to get started:

Audit for Compliance Gaps: Identify areas where your current software falls short of regulatory requirements. Are you GDPR compliant? Do you have the right tools for managing cookie policies? Address these gaps first.

Focus on Customer Needs: Evaluate your software from a user’s perspective. Does it provide a seamless experience? Consider upgrading to improve speed, functionality, and overall satisfaction.

Prioritize Regular Updates: Ensure your software can keep up with evolving regulations and customer expectations. Regular updates help you stay compliant and ahead of trends.

Invest in Scalable Solutions: Modern systems make adapting to changing laws and market needs easier. Look for software that’s designed to grow with your business.

Involve Key Teams: Engage your legal, compliance, and customer service teams in the process to ensure all aspects of the upgrade meet user expectations and regulatory standards.

The Final Word: Modernize, Don’t Maintain

Your software should support growth, not hold it back. Outdated systems create roadblocks that slow innovation, frustrate teams, and make it harder to stay competitive. Upgrading builds a resilient, agile foundation to help your business excel. 

It’s time to move forward. 

Modernization gives you the tools to adapt, grow, and meet the demands of today’s fast-moving market.

Curious about how to get started? Join our free four-hour workshop to take a closer look at what’s working, what’s holding you back, and where things can improve. 

We’ll explore tailored solutions to help your business and take the first step toward a brighter, more efficient future.

Let’s build it together.