Why Waiting to Upgrade from Legacy Systems is not an Option

The factory of the future is here, and manufacturers seeking to maintain competitiveness, connectivity and cybersecurity must embrace it.

The first and most critical step? To address outdated infrastructure. 

A study by Intoware has found that as much as three quarters - 74% of manufacturing and engineering companies - continue to rely on outdated legacy systems and spreadsheets.

However, a Stromasys survey found that 87% of IT decision-makers believe modernising legacy systems is essential for their success.

Agreeing with this is Yuri Pilipenko, founder and CEO of smart manufacturing leader OLSOM.

The founding journey of OLSOM

An expert in manufacturing IT and MES Systems, Yuri brings a unique blend of technical mastery and business acumen to his role, helping manufacturing leaders navigate the digital landscape towards Industry 4.0 and 5.0. 

His extensive scientific background includes post-graduate studies in process automation and project management, complemented by engineering experience at Ukraine's prestigious State Scientific Research Institute of Communications.

Yuri's journey in the tech industry began with roles as a software developer and senior solution architect - experiences that laid the groundwork for establishing OLSOM in 2011. 

Under his stewardship OLSOM has expanded globally, with operations across North America, Poland and Ukraine. 

With a 97% customer retention rate, the company is renowned for helping clients across manufacturing verticals from automotive to aerospace improve operational efficiency through smart digital solutions. 

With 25 years in manufacturing IT, designing and implementing smart factory solutions directly on the shop floor, Yuri understands that outdated legacy methods no longer meet the demands of digital manufacturing - leading to disparate systems, convoluted processes and data silos.

Below he explains more, highlighting how OLSOM can help. 

Why do many manufacturers still have legacy systems?

Many manufacturers haven't upgraded legacy systems due to three core challenges: cost, complexity and operational risks. 

Replacing or modernising longstanding infrastructure requires significant capital investment, which many companies are naturally hesitant to pursue if their existing systems are still functional. 

Secondly, legacy systems are typically deeply integrated into manufacturing processes and culture, meaning upgrades are complex and potentially lead to costly and disruptive downtime. 

Finally, compatibility is a huge hurdle for many manufacturers. IT/OT integration isn't guaranteed at any factory, and often costly custom solutions are required to integrate older machinery with Industry 4.0 technologies. 

On top of all this manufacturers face a sector-wide skills gap. They rely on workers who are experienced with and trained on legacy systems, and the upskilling needed to train these staff to use newer technologies is both time consuming and expensive. 

Many manufacturers for all the reasons above prioritise short-term operational continuity over promised long term efficiency gains, relying on ageing infrastructure to avoid the risk of production delays or downtime. 

While beneficial in the short run, this approach is a mistake that massively erodes manufacturers future competitiveness, productivity and efficiency, putting them in a disadvantaged position moving forward. 

The challenges of retaining legacy systems

Modernisation may be costly now - but not pursuing it will be significantly more costly in the future for manufacturers.

One reason for this is lost operational efficiencies, which can equate to millions per year in lost income. 

Legacy ERP and Manufacturing Execution Systems (MES) tools require manually inputting, storing and extracting data in systems like Excel spreads, increasing the risk of human error. 

Often, such legacy systems are extended with multiple tools to cover gaps in data collection and operations management - exposing the need for sophisticated integration, normalisation and data aggregation.

This dependency demands significant time and effort to maintain and keep track of such data - which is then cumbersome to organise and use to optimise critical factory processes and systems. 

There is also the reality of maintenance costs. Legacy systems are expensive to maintain, making them a cost burden to mid-market companies.

Due to a lack of resources available, legacy systems are often difficult to repair, an issue which will become more prominent and impactful as technology continues to advance. 

Additionally, legacy systems increase manufacturer's cybersecurity risks.

According to IBM's X-Force Threat Intelligence Index 2024, the manufacturing sector was the most targeted sector for the third year in a row in 2023. 

The last thing manufacturers want is to heighten this vulnerability.

To maintain cybersecurity agility and adapt to evolving threats, regular software updates and holistic cybersecurity management is integral. 

Legacy systems are unable to support new updates and, due to a lack of greater connectivity, create varying cybersecurity standards across companies.

Therefore manufacturers that use legacy systems are much more vulnerable to cyber attacks, data breaches and other security threats. 

On top of all this, we see issues with scalability and visibility when it comes to legacy systems in manufacturing. 

With the growth of complex, modern digital operations, legacy systems often struggle to adapt to new technologies, meaning manufacturers are more likely to fall behind competitors due to incompatibility and inflexibility issues, leading to missed opportunities.

In factory environments, real-time visibility is becoming a key driver to ensuring smooth and optimised operations. 

Legacy technology cannot provide this visibility, meaning not only are issues like delays and discrepancies likelier to occur, but also that manufacturers are not unlocking the competitive benefits of gaining comprehensive insights into their operations. 

Legacy systems have served a critical purpose in manufacturing, driving the strength and growth of the sector for hundreds of years. 

But today we've advanced beyond them, and manufacturers need technologies and systems that are suited to an increasingly complex, digital landscape. 

How OLSOM helps manufacturers upgrade legacy systems

Upgrading legacy systems is no longer a choice but a necessity. 

In our work with industry leaders like OP Mobility, Motherson and Hanon Systems, we have seen this proved time and time again.

In our experience, legacy systems are often too rigid, expensive to maintain and lack the transparency modern manufacturing environments demand. As a result, teams rely on workarounds - fragmented tools or outdated hardware that slow operations and increase costs.

By switching to OLSOM's AGW software, these manufacturers gained real-time visibility, reduced maintenance efforts and improved response times. With features like inventory tracking and SPC analysis, they shifted from reactive problem-solving to proactive decision-making - without disrupting production.

With support from OLSOM, manufacturers can pursue this whilst streamlining their processes, improving compliance and maintaining a competitive edge in an increasingly complex global market.

Since 2011, we have optimised operations at 57 plants worldwide, assisting manufacturers in a range of industry verticals including automotive, electronics, aerospace and heavy industry.

Offering real-time production data, advanced analytics and comprehensive solutions for inventory management and quality control, OLSOM is committed to the mission-critical needs of manufacturing, providing 24/7 support.

Our AGW platform provides manufacturers with an integrated system to monitor production, reduce errors and optimise workflows, crucial in production environments that demand agility and accuracy.

Sticking with legacy systems means missed opportunities. 

OLSOM’s solutions, allow manufacturers to modernise with minimal disruption, maintaining operational continuity while improving efficiency. 

With real-time insights and automation capabilities, manufacturers can respond to issues proactively, ensuring the highest standards of production without the risk of quality lapses.

Our approach ensures scalability - we start small, and grow as needed - enabling manufacturers to adapt quickly to changing market needs. 

Additionally, our low-code platform also ensures minimal technical expertise is required, empowering in-house teams to customise and deploy solutions.

In today's manufacturing environments, where connectivity is king and technological adoption is a key competitive differentiator, it is vital that manufacturers reassess and upgrade their legacy systems.

At OLSOM, we're excited to help more and more manufacturers make that journey. 

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