In the era of digital space, the enterprise applications should be accessible from mobile and different channels like SMS, IVR, email and other smart devices. Modernizing traditional existing applications to meet the demand of the increasing enterprise growth requires major shift in the focus of adopting modern technologies. Enterprise are looking for most cost effective way of modernizing their existing portfolio of application and subsequently looking for reducing the enterprise costs. Cloud and big data adoption is the must for any enterprise to do business insight modeling and by keeping their enterprise innovation strategy at par with their competitors. In order to mitigate the risk involved and to improve on the Return on Investment (ROI) it needs a systematic approach and methodology to mitigate the key risks and challenges involved. The modernization strategy should not be big bang and it should be a phase wise approach and should bring out all the relevance aspects upfront so that the modernization can be planned systematically to avoid any risk at later point. We propose a unique generic approach in doing the enterprise modernization and discuss about the key challenges, risks involved and also proposing a consolidated taxonomy for reference. The proposed approach will act as a generic methodology to perform the enterprise modernization across industry verticals. © 2005 - 2015 JATIT & LLS. All rights reserved.