The future of software is being written in...COBOL?
Move aside, React. This week, we are deep diving into the wonderful world of a little software platform with a big heart - COBOL.
Although I love a sexy UI and new products from the Valley as much as the next person, we need to talk about that ancient programming language still managing your money.
While Silicon Valley obsesses over the latest AI model that can generate cat pictures in Medieval style, COBOL - a language older than the Moon landing - is quietly processing 78% of your financial transactions.
Think about that: your ultramodern digital wallet is probably talking to code written when computers had less power than your smart toaster.
I gave the world of COBOL the old Product Party analysis and found some interesting stats that may have you someday dreaming of a world as a COBOL Product Manager.
(Kidding…kinda sorta)
A Brief History of COBOL
This is Grace Hopper.
Grace wasn't just any computer scientist - she was the OG who made significant contributions that still impact your bank account today.
She developed the first compiler, A-0, in 1952, translating human-readable code into machine code.
Basically, she helped computers understand humans before that was cool.
Hopper was instrumental in developing COBOL (Common Business-Oriented Language), one of the first high-level programming languages.
She participated in the CODASYL consortium in 1959, helping create this English-like language that revolutionized business computing.
COBOL's readability and machine independence made it widely adopted, and its continued relevance today - considering how quickly tech usually ages - is like finding out your great-grandfather still wins dance competitions.
The “Energizer Bunny” of Financial Platforms
In 2024, major banks like JPMorgan Chase are processing over $6 trillion daily through systems that could qualify for senior citizen discounts.
Before you rush to call this "technical debt," hold that thought.
This isn't your garden variety "we should probably update this someday" situation - it's more like finding out your grandmother's antique recipe actually makes the best cookies, and no one can quite figure out why.
Although some companies have modernization efforts happening within the finance industry, there are three main reasons your bank isn't racing to replace COBOL:
It's Annoyingly Reliable
COBOL systems: 99.999% uptime (as per my research through Perplexity)
Modern "cloud-native" banking platforms: 99.9% uptime
That tiny difference? Only about 8 hours of additional downtime per year.
No biggie, unless you need to buy groceries or pay rent during those 8 hours.
The Price Tag Makes Executives Cry
Full replacement cost: $1.2B+
A realistic timeline to implement a change: 7-10 years
There is a 63% failure rate for core replacements
It Knows Too Much
These systems have accumulated decades of regulatory wisdom
One bank found undocumented compliance logic that had prevented $470M in fines
72% of critical compliance rules existed only in code comments (the digital equivalent of crucial information written on Post-it notes)
What about AI? Can’t it fix everything?
You might think, "Surely AI can help us modernize?"
Well, about that...
A recent MIT/IBM study found AI attempts at COBOL modernization:
Introduced compliance errors 38% of the time
Lost performance optimizations in 92% of cases
Required nearly 3x more human babysitting than Java conversions
It turns out that teaching AI to understand COBOL is like trying to teach your smart speaker your grandparents' dialect - technically possible, but it is prone to some embarrassing misunderstandings.
The Rise of the "Code Archaeologists"
No, this isn't the plot of the next Indiana Jones movie.
Banks are now paying $350-500 per hour for software engineers who can:
Read technical specs from the 1980s
Interview retired developers - aka track down retired developers who remember why that function was named "DONT_TOUCH_OR_SYSTEM_DIES()" and coax wisdom from them without triggering PTSD
Reconstruct decision trees from commented code
Think of them as digital historians, except instead of unearthing ancient civilizations; they're figuring out why your checking account does that weird thing every third Tuesday.
Our Product Person “Archaeological Toolkit”
What makes this hilarious corporate time capsule relevant to you as a product person?
Well, while engineers are getting paid small fortunes to excavate these digital ruins, smart product folks are learning to:
Respect the Artifacts - That clunky legacy system might look ridiculous, but it's been reliably processing millions of transactions while surviving Y2K, multiple recessions, and countless reorganizations. Meanwhile, your cutting-edge app crashed because someone pushed it to production on a Friday.
Map the Undocumented Territories - Start creating visual maps of how these systems actually work (not how everyone thinks they work).
In my experience, these two things are roughly equivalent to the gap between "how I planned my vacation" and "what actually happened when I got there."
Maybe even use AI here to help you on your journey.
Learn the Dead Languages - No, you don't need to code in COBOL, but understanding enough to have intelligent conversations with your archaeological team will elevate you from "annoying product person with unrealistic requests" to "product visionary who gets technical constraints."
Create Modern Interfaces to Ancient Powers - The smartest product plays don't involve ripping out legacy systems but building elegant interfaces that connect modern experiences to battle-tested backends. This is like putting heated seats and Bluetooth in a tank.
All things considered, understanding legacy systems isn't just becoming a superpower – it's the secret career hack nobody told you about in business school.
While everyone else is chasing the shiny new framework that will be obsolete before your following performance review, you could become the rare product leader who can bridge the past and the future.
Final Thoughts
The most successful organizations treat legacy systems like archaeological layers - carefully preserving what works while building upward.
It's less "out with the old, in with the new" and more "let's carefully stack these technological epochs like a really expensive lasagna."
For those willing to embrace this reality, legacy systems become less of a career liability and more of a secret weapon.
After all, in an industry obsessed with the next big thing, sometimes the most revolutionary act is understanding why the old things still work.
So the next time you tap your phone to pay for coffee, take a moment to appreciate the digital fossil that's making it happen.
That transaction passes through code written when bell bottoms were unironically cool - and it's still getting the job done.
Until next week,
Mike @ Product Party
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Long before all the other roles are finally dead, the cobol engineer will still be reigning supreme. 🎉