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Extending Core Systems with Low-Code


Jun 7, 2021 - 9 minute read

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Ian Andrews Client Principal

With over 30 thirty years’ experience in the IT industry, and having come from a software development background, Ian has seen many different technologies applied to the delivery of customer-facing software applications. Having been an early adopter of Rapid Application Development in the 1980’s, it is now with the emergence of low-code that he sees the promise of Business and IT alignment as being finally fulfilled. Ian’s current role is that of a Client Principal, aligned to several of Objectivity’s key accounts, acting as trusted advisor, and supporting clients to achieve win-win outcomes.

See all Ian's posts

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Are Your Core Systems Holding You Back?

All organisations are likely to have a portfolio of individual applications or a monolithic package such as an ERP, forming their core business systems. Many of these systems will have grown up over time, evolving and being patched to meet the organisation’s changing requirements and needs. These systems support the DNA of the organisation and often encapsulate the inherent business processes and operational procedures. Yet, these core and often legacy systems can hold back an organisation by not responding to changing market or customer needs.

There is no doubt that large packages, such as an ERP, are powerful and are often feature-rich. However, they are not always very flexible when you need to customise them to your specific needs. Challenges can include access to scarce and often expensive implementation consultants, backwards compatibility after upgrades, and so on. As a result, organisations often have to accept growing backlogs of desired changes or adapt their processes to the package.

Where individual applications form the backbone of your operation, the maintenance of these systems individually can "lead to an organization of disparate processes that ultimately impeded rather than aid IT goals." - Forbes (2021).

As identified by Deloitte (2019), “The biggest challenge for IT and operations leaders is that technology and solutions never stand still: What was state-of-the-art five years ago may not be adequate now”.

Reliance on a restrictive package or legacy systems can hold organisations captive, hamper digital innovation, and increase technical debt day by day. Age doesn’t always define a legacy system. At times, it might be that it’s no longer supported or has grown incapable of meeting the needs of a business or organisation. Such software is often challenging to maintain, support, improve, or integrate with new systems due to its architecture, underlying technology, or design.

How Can You Move Forward?

Traditionally, there have been five main options to deal with the gap between what your organisation needs and what the existing core system offers:

      1. Adapt – change your processes to fit the package. However, for most organisations, often processes are the differentiator, and they need to evolve with you to remain relevant.
      2. Bypass – use workarounds, such as taking data extracts and manipulating data outside of the core systems through Excel or other applications.
      3. Fill the gaps – utilise conventional coding (“High-Code”) to add supporting applications.
      4. Package replacement – replace your core systems with an alternative or upgraded packaged solution, now usually a cloud-based software-as-a-service (SaaS)
      5. Custom solution – use conventional coding to replace the core system with a custom solution.

While options 1 and 2 appear to have the least initial impact, they will curtail your operational effectiveness and potentially lead to siloes of data and the proliferation of department-based solutions. Option 3 can help realise the value of the technology you already have and add functional capabilities to augment the core system. However, such augmentation needs to be carefully and centrally managed to ensure ongoing core system compatibility. Options 4 and 5 can involve significant time and cost for implementation and adoption. And with option 4, package replacement, there is no guarantee that the package will continue to evolve at the same pace as your needs and organisation.

With the pandemic still a reality, budgets rightfully remain under scrutiny for 2021 — “Digital leaders face challenging decisions on where to invest limited funds”. Yet, there is time-to-market pressure for many organisations, especially those who have seen a significant shake-up to previous operational models, such as for Retail.

But how can you balance the need to upgrade or extend your core systems, yet work within the budgetary constraints that many organisations face?

With the modernisation of these core systems or their replacement in part or in full, organisations have a significant opportunity to respond to the current market challenges and give their existing core systems a new lease of life. That is, to take advantage of and realise the value of the technology you already have and to retire the technical debt holding you back. As Forrester (2020) identified, there is now an alternative and viable choice — “rebuilding core applications using low-code development platforms”.

What Is Low-Code & What Are The Benefits?

Low-code is a software development approach that enables the delivery of applications faster and with minimal hand-coding. Rather than writing thousands of complex code and syntax lines, you can use low-code to build complete applications with modern user interfaces, integrations, workflows, and logic quickly and visually. Solutions can be tailored to your specific organisational needs. This offers reduced development costs, ensures lower ongoing support & maintenance costs, and leads to an accelerated time to delivery. Figures of 10x delivery acceleration compared with traditional coding are often quoted by low-code vendors and practitioners.

When considering extending core systems, adopting a low-code solution does add to the ‘build vs buy’ dilemma. The traditional advantages of custom development for scalability, competitive edge, and faster business growth support are significantly enhanced with low-code. Likewise, the potential disadvantages of custom development for the upfront cost, time to delivery and early version stability are reduced. With package adoption, the potential advantages, lower upfront costs, and faster implementation have been eroded by low-code project costs. And most significantly, where me-too package adoption led to the loss of competitive advantage, a custom low-code solution or augmentation can overcome this weakness.

In many ways, adopting a low-code platform can be considered a hybrid solution between custom development and package adoption. Low-code solutions reuse many standard, and well-tested, underlying modules and other platform components. Developers are left to focus on the value-adding activities, with the mundane and repetitive definition of items such as forms and workflows handled for them.

Low-code is a mature software development approach, with some of the mainstream platforms having a twenty-year plus heritage. Gartner, early in 2021, commented that, “While low-code application development is not new, a confluence of digital disruptions, hyper-automation and the rise of composable business has led to an influx of tools and rising demand”. Furthermore, Gartner (2021) identify that, “Globally, most large organizations will have adopted multiple low-code tools in some form by year-end 2021…. that support application innovation and integration.”

Where Do I Start Extending My Core Systems?

The extent of what core systems do, to some extent, varies between different organisations. Forrester (2020) identify three typical applications or areas of functional scope where low-code is suited to replace or extend core system functionality:

  • Shared services that provide crucial functions to many business processes, e.g., billing, scheduling, IT asset management.

  • Core operational processes that automate what the business does, e.g., processes to manage core functions, merchandising, logistics, etc.

  • Systems of Record ensure the integrity of foundational business data, e.g., consistent customer and supplier data maintenance.

There are various approaches in considering the scope of any potential extension, enhancement or replacement of a core system by low-code. The selection of the most relevant approach will depend upon whether the core system consists of individual applications or a single system. These modernisation approaches, in order of increasing scope and complexity (and risk), are:

  1. Adding new modules – adding new functionality or replacing those modules or applications for which it is not feasible or cost-effective to enhance as-is.
  2. Step-wise or phased replacement – replace the core system, module by module or application by application.
  3. Like-for-like modernisation – transfer the entire system’s functionality unchanged to low-code.
  4. Rebuild and enhance – rebuild the entire core system, while also making improvements.

When approaching a core system extension or replacement on a new module or phased basis, prioritise delivering tangible benefits and subsequently increase the delivery scope. As commented by Nigel Fenwick from Forrester (2020), “operational modernisation frequently delivers significant reductions in operating costs with a payoff in months, not years”.

For example, a major UK fashion retailer had a phased, multi-year ERP adoption in progress at their organisation that included the configuration and customisation of standard package functionality. However, business priorities meant that an inventory management solution was urgently required before the ERP was fully commissioned. The retailer’s employees needed to browse warehouse stock, manage stock transfers, assign prices, etc. Furthermore, the head office required up-to-date information regarding in-store inventory and the state of stock across warehouses. This was achieved promptly with a low-code application interfacing with the ERP system.

The benefits of developing and utilising low-code have been recognised by more than one leading enterprise package provider. For example, Microsoft, with its Dynamics 365 Platform and Salesforce, have adopted low-code as their primary extension mechanism.

When contemplating the extension of core systems, it is essential to identify the spectrum of capabilities that the various low-code platforms offer. Some platforms are more suited to citizen development and personal or departmental level solutions, and others are more firmly rooted at the enterprise level. From an enterprise core system perspective, the selected low-code platform must cater for high availability, performance at scale, minimal data loss in outages, and security certifications.

How To Select A Relevant Area For Low-Code Enhancement?

Conduct a fit-for-purpose assessment of your current core systems, their architecture and organisational efficacy. As outlined by Forrester (2020), there are 7 essential practices that can help you get started with building core applications with low-code:

  1. Assess your core system(s) and classify them according to their core functions:
    - Match these to where the adoption of low-code is identified as being a potential benefit, e.g., for shared services.

  2. Identify where the existing technology is letting you down or limiting your capabilities:
    - Core applications rely on complex business logic and need to scale to thousands of internal users with huge transaction volumes.
    - Identify where modern architecture practices will benefit, such as loose coupling of services and microservices, layering process domains and master data management.

  3. Your core systems, by their very definition, are mission-critical; you must define your non-functional requirements:
    - Apart from reliability and performance at scale, look for failover features, operational monitoring tools and disaster recovery features.

  4. Rely on platform vendors with commitments to security and auditing—your core systems will:
    - Contain data about your products and services, and specifically about individuals, both your employees and also your customers; and
    - Require controls over identities, roles, access rights and data protection as a minimum.

  5. Favour vendors with financial stability, growth and reference customers:
    - As with any package or traditional high-code solution, you will be “signing up to” the ongoing adoption of a development platform and frameworks with low-code adoption.

  6. Involve business people in the core services area selection and in the development process:
    - The selection of a relevant area for enhancement or replacement is not just an IT evaluation and recommendation.
    - As the day-to-day users of the current systems, your business colleagues know the existing system’s foibles and merits well.

  7. Effective end-user training is essential:
    - Establish product champions or super-users engaged throughout the implementation process and ensure that users are trained on the new system and its capabilities.

Conclusion & Next Steps

Maintaining a core system beyond its useful life can severely negatively impact core operational processes by side-lining many innovations and opportunities that may exist. Many core systems are often maintained because organisations simply cannot function without them, and the risks associated with changing them seem too high. Low-code offers a viable and cost-effective mechanism for extending or augmenting core system functionality, even when the core system is not legacy.

Low-code can offer a viable alternative to package adoption, including major version upgrades or traditional high-code custom development. As Forbes (2021) commented:

“…getting these systems to work together to communicate data and track the end-to-end processes of the organization is key to driving digital success. Understand this, you can begin to examine which core app can remain onboard as an integrated solution and which should be modernized through the low-code platform.”

Take a pragmatic view on modernisation, and don’t try to change too much too quickly. Prioritise those applications or modules that will offer the most significant benefit. Engage with a low-code specialist who will work alongside your team to understand your needs and how best to exploit various low-code platforms’ capabilities and strengths.

2988 HC Digital Transformation 476X381
Ian Andrews Client Principal

With over 30 thirty years’ experience in the IT industry, and having come from a software development background, Ian has seen many different technologies applied to the delivery of customer-facing software applications. Having been an early adopter of Rapid Application Development in the 1980’s, it is now with the emergence of low-code that he sees the promise of Business and IT alignment as being finally fulfilled. Ian’s current role is that of a Client Principal, aligned to several of Objectivity’s key accounts, acting as trusted advisor, and supporting clients to achieve win-win outcomes.

See all Ian's posts

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