Discover How North American Companies can Strategize AI-Powered App Modernization in 2025

As per Gartner, an American technological research and consulting firm, 90 percent of today’s apps will become obsolete or reach the end-of-life phase by 2025. Such scenarios will result in a growing technical debt. Currently, technical debt outlines 40 percent of IT budget driven by focused app maintenance and mitigation strategies.

According to Red River, an IT services and consulting company, 74 percent of medium-sized businesses and enterprises report massive amounts of technical debt leading to increased OpEx and maintenance overheads. A plausible solution to overcome such debt is advancing existing systems and reengineering outdated software products. That’s where AI-powered app modernization can help.  

Legacy software and apps have catered to organizational requirements for years. However, these assets are unable to meet the expectations of modern tech-savvy users in 2025. They are pushing them to shift toward new-age apps of competitors offering unmatched UX. Adopting modern technology advancements like GenAI, Agentic AI, and Applied AI and ML is the key to achieve long-term business success.

The Role of AI in Modernizing Legacy Software in 2025

Earlier, app modernization was all about migrating legacy apps to a scalable cloud solution. Many small and medium-sized businesses (SMBs) often considered it as strategic automation backed by modern technology stack. However, times have changed. In 2025, businesses need to approach app modernization as a journey across its lifecycle. This calls for strategic efforts around data management, code rewriting, and UX.

AI has emerged as a game-changing contributor to support the evolution of apps. AI technologies like GenAI, SLMs, LLMs, and AI agents are capable enough to resolve the pain points of app modernization. They can fast-track the entire software modernization process, improve productivity, and minimize overhead costs. Here are some tasks for which a certain number of U.S. companies are implementing AI in app modernization.

Source: Red Hat (a leading provider of enterprise open source solutions)

IBM, a multinational IT research, services, and consulting company, performed a survey of 400+ IT experts across various industries in North America. They found out that 3 out of 4 experts believe that their companies are still using disparate systems backed by traditional technologies. But this scenario is about to take a major turn in 2025. Seventy-nine percent of companies have started using GenAI in app modernization to increase business agility.

Another report by Red Hat states that 95 percent of technology experts consider app modernization as a top priority for their organization’s success. The report also claims significant changes in company outlooks to transform legacy apps using AI. Here are some notable perspectives.

• Seventy-eight percent are planning to implement the latest AI technologies to support software modernization.
• Fifty-three percent are using AI tools to accelerate app modernization process.
• Forty-two percent are integrating AI into legacy systems for targeted modernization.    

Why North American Companies Should Adopt AI for App Modernization

As AI grabs the center stage in app modernization efforts, SMBs in North America and worldwide need to use it to the best of their capabilities. The companies that implement AI technologies early will be better positioned to experience potential business benefits in the long-run. Here are some key reasons why businesses should modernize with AI.

• Improved Operational Productivity and Efficiency

As per PwC, a multinational professional services brand, states that companies that integrate AI into their products are poised to increase productivity by 20 - 30 percent.

AI-powered app modernization can automate mundane processes. It can optimize redundant operations, streamline cloud migration, improve developer productivity, and improve app performance. It can enable decision-makers to focus on core problem-solving tasks and augment the integration of custom features and functionalities.

• Reduced Recurring App Maintenance Expenses

App modernization with AI can decrease high-costs related to sudden discrepancies. Trained predictive models built on top of GPT algorithms can detect unanticipated failures. This can minimize downtime and eliminate the additional expenses related to emergency fixes.

These models can automate code refactoring and devise self-recovery mechanisms to cut adverse app maintenance costs. Deloitte, a global professional services firm, states that predictive AI models can decrease repair planning time by 50 percent and reduce maintenance costs by 25 percent.    

• Faster Time-to-Market without Compromising Quality

Technology experts state that AI-driven testing and deployment can amplify app modernization cycles like never before. With AI-driven tools, SMBs in North America can automate quality checks, debugging, and CI/CD pipelines. On the other hand, ML algorithms can help with autonomous code generation to reduce time-to-market and provide high-end service delivery.  

• Increased Business Scalability for Growing Customer Base

With AI-based app modernization strategy, businesses can efficiently scale and accommodate the increase in customer engagement during peak hours. For example, IKEA a worldwide retailer of home products and solutions, embedded its eCommerce platform with AI-based automation and personalization features. This integration of AI into its existing system helped them cater to the growing traffic, enhance UX, and increase online sales by 300 percent.

• Superior and Top-Notch Quality Product Delivery

App modernization with advanced AI capabilities is the best way to deliver the finest products to customers. AI models can set up automated evaluation mechanisms to improve code integrity. They can deploy self-operating discrepancy detection system to discover and resolve potential issues beforehand. They can even analyze behavioral patterns to deliver superior products that offer seamless CX.

• Enhanced Security and Remediation Strategies

With AI-enabled app modernization, SMBs can create a stringent security environment backed by a real-time response system. It can enable smart fraud detection, prevent cyberattacks, safeguard confidential data, and ensure tight compliance with regulations like HIPAA and GDPR. Business will be able to employ robust risk management strategies via AI-based security orchestration, automation, and response systems.

Practical Examples of App Modernization Using AI

Many small companies, mid-sized firms, bootstrapped organizations, and startups in North America have achieved their business objectives with AI-powered app modernization. How? By partnering with a trusted legacy app modernization services provider, such as Clarion. Here are some real-world examples to give you a better idea.

• New Features Integration Using AI to Advance a Legacy Healthcare App

Business Need

A North American medical facility was struggling with their legacy app driven by traditional EHR system. As such, they experienced prolonged data retrieval, compliance issues, and time-consuming administrative operations. The facility was looking to advance their existing app with AI-driven features that can reduce manual data input, enhance efficiency, and minimize human errors.

Clarion’s Strategic Solution

Clarion helped the medical facility modernize their legacy healthcare app using AI. Our AI and technology experts advanced their EHR system with NLP-driven data retrieval and ML-based automation techniques.

We introduced new transformative features like autonomous medical transcription and predictive data analytics. We also deployed an AI-based chatbot to support administrative staff, patients, and other stakeholders.

Impact

• Reduced operational workload by 44 percent
• Accelerated data retrieval by 36 percent
• Increased data accuracy by 22 percent
• Improved productivity by 20 percent
  
  

• AI-Driven Product Recommendation Engine for a Leading eCommerce App  

Business Need

An eCommerce startup in Canada was facing a drastic decrease in customer engagement. Their standard product recommendations led to poor conversion rates. The company sought to build a customer-centric recommendation system to offer personalized suggestions and minimize cart abandonment rates.

Clarion’s Strategic Solution

Clarion helped the eCommerce startup develop an AI-based recommendation engine backed by DL algorithms and conversational data analytics. This AI engine analyzed past orders, purchase patterns, and search behavior to deliver tailored product recommendations. It enabled the retail manager to make data-driven decisions that suit their audience.

Impact

• Elevated conversion rates by 52%
• Increased customer engagement by 50%
• Decreased cart abandonment rates by 41%
• Faster and superior product recommendations

Supercharge your app modernization journey with the power of AI. Partner with certified AI experts right away.

Clarion’s 5 Cs for Successful AI-Powered App Modernization

The success of an AI-driven app modernization journey depends on various factors. Out of which, the most significant aspect is having a well-structured strategy in place. Here are Clarion’s 5 Cs that can help North American companies boost their legacy modernization journey in 2025.

• Clarity

Have a clear idea of your business objectives. Identify the goals your company wants to achieve with AI-powered app modernization. Align those essential goals with your AI integration requirements and app modernization trends. Discover pain points to resolve, seek measurable outcomes to nurture, and deploy KPIs (UX, cost, efficiency) to succeed.  

• Customization

Focus on adding new and personalized features and functionalities based on cutting-edge AI capabilities. Use technologies like Applied AI, Adaptive AI models, Agentic AI to introduce customer-centric assets within your app. Employ natural language chatbots and virtual assistants to guide innate conversations.

• Computing

Utilize the capabilities of cloud-native architectures for superior computing power. Onboard top cloud experts that can help you modernize your app using Azure OpenAI services. Prepare to migrate your app from monolithic systems to microservices-based models. Implement serverless computing and AI-based automation for containerization, orchestration of microservices, and cloud deployment.

• Consistency

App modernization is not a one-time effort. It demands consistent optimization. You must leverage AI for DevOps to streamline CI/CD pipelines. Practice using AIOps and MLOps for predictive and prescriptive maintenance of your app. Create continuous feedback loops using AI models to track system performance and automate debugging.  

• Collaboration

Error-free AI-embedded app modernization is only possible when you partner with an experienced technology solutions provider, such as Clarion. This will help your small business in North America explore the true potential of custom modernization, cost-effective automation, extended collaboration, and AI-driven reengineering.  

Your Go-To AI Toolset to Accelerate App Modernization in 2025

There are different layers to modernizing apps with AI technologies. You need to identify which tools perfectly suit your requirements and can deliver expected outcomes. Here is a tabular representation for better understanding.

The above image highlights the use of AI for different app modernization scenarios. SMBs in North America can integrate AI technologies in combination with other advanced tools to achieve their modernization requirements head-on. CTOs, CEOs, and IT stakeholders can explore potential AI tools like GPT for data-driven decision-making.

Wrapping Up

The use of advanced technologies like AI and ML in modernizing legacy apps is a must in 2025. It is a proven solution to create future-ready solutions that can dominate the global business landscape like never before. The only key consideration here is to choose the right technology partner with experience in AI-powered app modernization.

Clarion has been a reliable partner for SMBs in North America and worldwide looking to modernize outdated software, advance existing apps, and integrate AI-based custom features. Our vEmployee delivery model has helped small companies and enterprises build their own remote development team, accelerate modernization journey, and maximize business ROI.

Ready to modernize your legacy app using AI? Consult our AI and technology experts to get started.