Software developers with valuable legacy products or portfolios are thinking about a question that has huge implications for their business.
When is the right time to upgrade a legacy software product?
Software modernization aligns the code base of legacy software with today's business needs and environments in one of the following three ways:
Refactoring: Converting legacy, cumbersome code into simple, easy-to-read, and maintainable code.
Rearchitecting: Examining the existing code base, determining its quality and suitability for future use, and rebuilding it to provide future value.
Replacement: Eliminating obsolete code and rewriting it from scratch to meet current and future needs.
Software modernization minimizes internal server footprint and associated costs, making them more predictable. More importantly, it creates a highly scalable and always-on IT ecosystem that allows organizations to focus on their core business and launch new innovative products rather than being distracted by IT-related issues and constraints.
Finding the right time to modernize
Software products go through a life cycle just like any other product, from inception and growth to maturity, decline and obsolescence. The real challenge is figuring out when a software product enters each phase and how long it stays in each phase. This depends on a variety of factors, including user expectations, market fit, market externalities, and the competitive environment, all of which are constantly changing over the life of the product.
The most important responsibility for both product managers and developers is to determine the pivot point-the point at which a software product transitions from the growth phase to the maturity phase. This point provides a unique opportunity in the product lifecycle when an upgrade initiative can maximize the product's market value while maintaining and even increasing market share, revenues and profits.
When a product enters the "sustainable" part of the curve, software developers and managers must ask the critical question.
Can targeted investments be made to upgrade the product and stimulate another growth cycle or position it in a larger market?
If not, should you maintain the product until you can move users to a newer version? Turning too early can mean a reduced return on investment (ROI) made during the product lifecycle's pre-launch, initiation, and growth stages.
If you pivot too late, customers may already be abandoning the product in favor of more modern competitors. The time to start upgrading software is when you are still on the growth curve and notice that the curve is getting flatter.
If you can start upgrading just when you know the product is about to reach maturity, you can maximize your initial investment, resulting in the maximum potential ROI. Why don't software companies take action at the pivot point?
Even if they get the pivot point right, which is not an easy task, many software companies don't consider upgrading at this unique point in the product lifecycle. Why? It's often due to two common misconceptions:
They believe that modernization is an all-or-nothing proposition. It requires an all-or-nothing proposal.
They believe it must be done all at once to gain business benefits. Again: 100% or nothing.
That's a very high ceiling for many organizations. Fortunately, it's not.
Modernization has levels, each with its benefits. They can be addressed in stages until they meet your business goals and pass the test of a cost-benefit analysis.
A cost-benefit analysis of software upgrades
The path to modernization begins with an in-depth evaluation of your specific product and the appropriate balance of costs and benefits. Product managers and developers should analyze the product along several dimensions, such as applications, infrastructure, costs, cloud, digital readiness, and resource allocation.
This assessment should also cover domains and business processes to determine what should be eliminated, consolidated, upgraded, replaced, or removed, as well as explore future investments to maximize the longevity and value of the product.
This cost-benefit analysis allows you to look at the situation with two outcomes in mind:
Simply retaining and maintaining the existing architecture with minimal operational investment.
Transitioning to a new, modernized architecture designed for long-term sustainability and requiring a significant capital investment.
This formal cost-benefit analysis will provide confidence and flexibility in the organization's actions and the ability to turn around quickly and achieve results as soon as possible.
Whether at the beginning of your modernization journey or looking to move to the next level of digital business, Sodeira Solutions' team of software product development experts is here to help you with your software modernization efforts.