SimCorp Study Notes Legacy Systems' Stubbornness, R&D Disparities
Those findings, Walter suggests, are owed to the expense and complexity of both implementing newer platforms and decommissioning the legacy kit, as well as to firms taking alternative routes, such as outsourcing or living with temporary workarounds. What distinguishes legacy vendors from those considered 'state-of-the-art', Walter says, is the ability to strike a delicate balance, pursuing two kinds of business strategies simultaneously.
"Unlike their legacy brethren, state-of-the-art vendors are adept at gaining new clients while holding onto to the ones they already have," he argues.
One way the research measures that component is a comparison of vendor research and development (R&D) spend as a percentage of total revenue in 2012, against clients' reported willingness to consider repurchasing the platform. A fairly consistent positive correlation was found to exist between the two, suggesting that greater research spend and ability to refresh platforms to fit existing requirements is key. Among the ten technology products compared, the R&D percentage ranged from 9 percent to 22 percent; the number considering repurchase, meanwhile, varied far more widely, from 38 percent to 92 percent.
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