Explained: Why Cisco believes there will be no ‘legacy companies’ in the AI era
Artificial intelligence could turn one of big businesses' greatest weaknesses into a competitive advantage. Cisco President Jeetu Patel argues that continuous AI-driven software modernisation may blur the traditional divide between startups and established enterprises.
3 Min Read
For decades, the term "legacy company" has been used to describe large, established businesses that struggle to innovate as quickly as younger rivals. Success often brought scale, but it also created complexity. Over time, layers of software, processes and bureaucracy made change slower and more expensive.
Cisco President Jeetu Patel believes artificial intelligence could fundamentally change that equation.
Why do companies become ‘legacy’ businesses?
Companies do not become "legacy" businesses simply because they are old. They become legacy businesses when the systems that helped them grow begin to slow them down.
One of the biggest reasons is technical debt — the accumulation of ageing software and code that becomes increasingly difficult to maintain. Over years and sometimes decades, companies add new features and products on top of existing systems, creating complex technology stacks that are expensive and time-consuming to update.
This often gives startups an advantage. With fewer customers, simpler systems and modern software architectures, young companies can usually develop and launch products much faster.
Why does AI change the equation?
Patel argues that AI-powered coding tools and agents could make software development far more dynamic.
Instead of living with old code for years, companies can continuously rewrite, simplify and improve their systems. AI can automate many repetitive coding tasks, allowing engineers to focus more on architecture and product design.
Cisco has already begun using AI internally. In an exclusive interview with CNBC-TV18, Patel said one of the company's security products was reduced from around eight million lines of code to less than 1.5 million lines within weeks. According to him, the changes improved performance, reduced vulnerabilities and made future updates easier.
The ability to constantly refactor software could help companies avoid carrying decades of accumulated technical debt.
Why scale may become an advantage again
Historically, size often worked against large enterprises. Maintaining extensive product portfolios and serving millions of customers made rapid innovation difficult.
Patel believes AI reverses that logic.
Large companies already possess significant advantages, including established customer relationships, distribution networks, data and brand recognition. If AI enables them to modernise software continuously, those strengths could become more valuable rather than burdensome.
In that scenario, established businesses may be able to innovate at speeds much closer to startups while retaining the benefits of scale.
Why software is only part of the challenge
However, ageing code is not the only reason companies become legacy organisations.
Large businesses often face organisational hurdles such as slow decision-making, bureaucratic structures, regulatory requirements and resistance to change. Even if AI makes software development faster, companies will still need to adapt their cultures and operating models.
Technology alone cannot guarantee agility.
Why this matters beyond Cisco
The rise of generative AI has triggered a broader debate across the technology industry about whether software development itself is undergoing a structural shift.
If AI can help businesses continually rewrite and modernise their systems, the traditional distinction between startups and established companies could begin to narrow. Instead of being defined by their age, companies may increasingly be judged by how quickly they can adapt to changing technologies and customer needs.
That is why Patel believes the idea of a "legacy company" may eventually lose its meaning.
Whether AI can overcome not just technical debt but also organisational inertia remains an open question. But if it succeeds, one of the oldest disadvantages of scale could become a source of competitive strength.
Cisco President Jeetu Patel believes artificial intelligence could fundamentally change that equation.
According to Patel, AI may allow companies to continuously modernise their software, potentially removing one of the biggest disadvantages that traditionally separated established firms from startups.
Why do companies become ‘legacy’ businesses?
Companies do not become "legacy" businesses simply because they are old. They become legacy businesses when the systems that helped them grow begin to slow them down.
One of the biggest reasons is technical debt — the accumulation of ageing software and code that becomes increasingly difficult to maintain. Over years and sometimes decades, companies add new features and products on top of existing systems, creating complex technology stacks that are expensive and time-consuming to update.
This often gives startups an advantage. With fewer customers, simpler systems and modern software architectures, young companies can usually develop and launch products much faster.
Why does AI change the equation?
Patel argues that AI-powered coding tools and agents could make software development far more dynamic.
Instead of living with old code for years, companies can continuously rewrite, simplify and improve their systems. AI can automate many repetitive coding tasks, allowing engineers to focus more on architecture and product design.
Cisco has already begun using AI internally. In an exclusive interview with CNBC-TV18, Patel said one of the company's security products was reduced from around eight million lines of code to less than 1.5 million lines within weeks. According to him, the changes improved performance, reduced vulnerabilities and made future updates easier.
The ability to constantly refactor software could help companies avoid carrying decades of accumulated technical debt.
Why scale may become an advantage again
Historically, size often worked against large enterprises. Maintaining extensive product portfolios and serving millions of customers made rapid innovation difficult.
Patel believes AI reverses that logic.
Large companies already possess significant advantages, including established customer relationships, distribution networks, data and brand recognition. If AI enables them to modernise software continuously, those strengths could become more valuable rather than burdensome.
In that scenario, established businesses may be able to innovate at speeds much closer to startups while retaining the benefits of scale.
Why software is only part of the challenge
However, ageing code is not the only reason companies become legacy organisations.
Large businesses often face organisational hurdles such as slow decision-making, bureaucratic structures, regulatory requirements and resistance to change. Even if AI makes software development faster, companies will still need to adapt their cultures and operating models.
Technology alone cannot guarantee agility.
Why this matters beyond Cisco
The rise of generative AI has triggered a broader debate across the technology industry about whether software development itself is undergoing a structural shift.
If AI can help businesses continually rewrite and modernise their systems, the traditional distinction between startups and established companies could begin to narrow. Instead of being defined by their age, companies may increasingly be judged by how quickly they can adapt to changing technologies and customer needs.
That is why Patel believes the idea of a "legacy company" may eventually lose its meaning.
Whether AI can overcome not just technical debt but also organisational inertia remains an open question. But if it succeeds, one of the oldest disadvantages of scale could become a source of competitive strength.
(Edited by : Prashant)
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