Cutting costs by retiring legacy systems – Customer story

A global telecommunications company had long used SAP to manage key business processes. However, as time passed, they faced the common challenge of accumulating legacy systems – older applications that were no longer in active use but still necessary for accessing historical data for compliance and auditing purposes. These systems, while essential for maintaining business continuity, were becoming increasingly expensive to maintain, and moving them to newer platforms seemed unnecessary and costly.

At the same time, the company was embarking on an IT transformation, migrating their core infrastructure to the Google Cloud Platform (GCP). They wanted a solution that would allow them to streamline their IT landscape by decommissioning legacy systems while ensuring ongoing compliance with legal, tax, and audit requirements.

SAP, as their long-standing technology partner, stepped in to provide a solution and enlisted Proceed Group to handle the complex task of retiring legacy systems and ensuring the business could continue to access important data.

The company’s key needs included:

• A scalable architecture that would support future data volume growth while controlling costs.
• Ensuring continued compliance with tax and legal regulations, including accessing historical data in line with audit and compliance requirements.
• Simplifying their IT landscape by retiring legacy systems and providing streamlined access to the necessary data, using existing technology components within their SAP NW and S/4 systems.

Challenges identified:

The company faced several pressing issues related to its legacy SAP systems:

• The ongoing costs of maintaining “read-only” legacy SAP applications were becoming unsustainable.
• A lack of adequate tools made compliance with tax, legal, and data privacy regulations difficult.
• Running outdated and unsupported software posed significant business risks, especially with regards to retaining data beyond its legally required retention period.
• Maintaining these systems required substantial time and effort from IT and business professionals, diverting resources away from more strategic initiatives.

Desired outcomes:

To address these challenges, the company aimed to:

• Achieve a significant reduction in the total cost of ownership (TCO), while ensuring ongoing access to critical data for business, compliance, and regulatory purposes.
• Avoid the additional costs of migrating legacy applications to GCP.
• Ensure that the required data from legacy systems was migrated to a modern, supported platform that could sustain long-term data retention.
• Free up staff to concentrate on strategic business priorities, increasing overall agility and improving operational efficiency.

What Proceed did:

Proceed helped the company by retiring six legacy SAP systems:

• 2 HR systems (SAP HCM)
• 4 finance systems (SAP FI)

To ensure secure access to legacy data, SAP Information Lifecycle Management (ILM) was implemented on the cloud, with data stored in SAP IQ. The historical data was transferred using SAP SLT to a staging area before being archived. Rigorous testing ensured that the archive files matched the data in the staging area, providing a full and accurate transition.

Proceed created a series of essential reports to allow continued access to key financial and HR data. These reports included information on vendor and customer line items, general ledger account details, billing documents, and payroll results. In addition, Proceed conducted knowledge transfer sessions to enable the company’s internal team to generate their own reports in the future.

The results:

By decommissioning the legacy systems, the company achieved an estimated savings of €2 million annually, which had previously been spent on maintaining and supporting outdated software.

Key benefits:

Simplified IT landscape: Retiring the legacy systems significantly reduced the complexity of the company’s IT infrastructure, streamlining operations and providing easier access to historical data without the need for maintaining obsolete systems.

Cost savings: The removal of outdated systems led to a significant reduction in the total cost of ownership (TCO), freeing up resources to focus on more strategic business initiatives.

Compliance assurance: By implementing SAP ILM, the company ensured compliance with tax, audit, and data retention regulations. Archived data remained accessible through predefined reports, which were designed to meet both business and regulatory requirements.

Enhanced performance: The new, simplified IT landscape required fewer maintenance efforts and provided improved operational performance. Having fewer layers of software, network, and hardware infrastructure translated into greater efficiency and stability.

Long-term value:

The project enabled the company to shift its focus from managing outdated systems to optimising its IT infrastructure for future growth. Proceed Group’s work in retiring the legacy systems and ensuring that historical data was securely archived resulted in substantial cost savings, improved compliance, and a simplified IT landscape.

By leveraging SAP ILM, the company now operates with a modernised data retention framework that will support its business for years to come, allowing it to better adapt to future challenges and opportunities.