In an ideal world, every college and university would have three to seven years to implement a new core modern system, starting with one to two years of planning and preparation. But in reality, institutions are not always afforded the luxury of setting their own timelines.
The earlier an institution starts to prepare for modernization projects, the more time it has to thoroughly vet its options, gather input and feedback from key stakeholders, reach consensus, and plan for budgetary and staffing needs—all the people, process, technology, and data considerations that factor into a successful switch to a new system. With this in mind, Tambellini Group analysts strongly urge technology leaders to begin planning for such transitions now, even if they believe their core systems can meet their needs for the next decade.
Timelines are often externally imposed by solution providers, with many likely to announce sunset dates for supporting their legacy products in the next few years—if they haven’t already. This leaves many institutions at a vulnerable crossroads: consider that 80 percent of 3,316 US postsecondary institutions have yet to select a SaaS-architected finance or HCM platform, according to Tambellini Group’s 2023 Finance and HCM Market Share, Trends, and Leaders Report, and the percentage for student systems is even higher.
Even when the technology provider doesn’t create the impetus for change, new leaders often do. With the high number of senior leader changes in higher education and the ever-present influx of leaders coming from outside of higher education, encountering a new institutional leader who has already experienced modern platforms and their capabilities can quickly bring a platform change into view—whether planning and preparations have been completed or not.
Many optimists hold fast to the hope that vendors will give sufficient advance notice of end-of-life dates for their legacy solutions, but institutions shouldn’t count on that happening. While Oracle has committed to providing a rolling ten-year window of support for their PeopleSoft users, no other vendors currently offer a similar lengthy guarantee.
Institutional leaders are generally aware that sunset dates for their legacy solutions are looming, but they don’t know exactly when those deadlines will come. And vendors can surprise them: Unit4 recently announced that it would stop supporting its legacy ERP system in a year, which makes it difficult for its clients to plan and prepare sufficiently for a major platform transition.
Whether an institution has all the time and resources in the world to map out its modernization journey or is forced to make an abrupt change because of externally imposed deadlines, it can typically take one of the following three courses of action:
If institutions choose either of the first two options, their technology leaders must evaluate platform providers differently than they have in the past, when institutions had purely transactional seller-buyer relationships with these vendors. That dynamic made more sense when they invested in on-premises legacy platforms and relied on internal staff to maintain and customize those solutions for their unique needs.
But enterprise cloud-native and cloud-adapted systems work very differently, and require significant changes to internal staffing, operations, and processes. These continuously innovating solutions require institutions to work with vendors as partners in innovation to ensure their products evolve with their shifting and growing needs. Also, consider that customers are outsourcing mission-critical technology operations to these vendors, deepening the needed relationship considerably.
This is why it’s important—whether an institution modernizes with its existing solution provider or moves to another one—to evaluate vendors for compatibility and fit as long-term collaborative partners. Tambellini Group’s StarChart™ for Student, Finance, and HCM systems are helpful visualization guides to compare modern platforms based on a proprietary evaluation of factors related to usability and innovation, crucial differentiators in technology investments.
Also consider the preparation work that needs to be done, both from a business and technology perspective. Tambellini offers a Modernization Readiness assessment for its clients and continues to publish research on these focus areas regularly.
Which pathway is the optimal route forward for your institution to take when faced with a sunset deadline for your current legacy solution? It will depend on numerous factors, but here are some considerations to bear in mind when weighing each option:
Don’t assume that this will be the least expensive option. It can be tempting to make that conclusion because this course of action may appear to be the easiest to take, but it may not be in the best long-term financial interest of your institution if your current provider isn’t compatible with your future needs.
When it comes to evaluation costs, expect that SaaS fees for modern solutions are going to be higher than previous license fees for on-premises software because your institution is buying ongoing services, not just software. The main driver of choosing this pathway, as with the other two, should be a high level of satisfaction with the existing vendor.
When the time comes to embark on the large-scale transition to a modern system, most technology leaders and stakeholders want to assess their options beyond their current provider to ensure that they are getting the most competitive price. This is sound reasoning, but consider that there is always a cost of going to market, especially when requiring vendors to engage in a competitive bid process.
There are few situations where this is approach is advisable, as it’s usually a risky stopgap solution chosen because an institution doesn’t have sufficient time to pursue either of the above two pathways before their existing legacy product reaches its end-of-life deadline.
In the rare instances where the technology team has managed their core systems well, made incremental investments to stay current and supported, and have added functionality around the core to minimize the impact of the slower progress of innovation on them, this can work in the short-term to buy an institution more time to plan for a bigger change. But make no mistake, an institution is still on borrowed time, and security vulnerabilities can quickly make this approach untenable when patches aren’t available.
Before opting for this pathway, be sure to have a clear understanding of the level of support and assistance to expect from an existing legacy vendor. Some questions to ask them include:
Not sure which pathway is the best course of action to take? Wondering when and how to start planning for your modernization journey? Explore our technology modernization and optimization services and reach out to a Tambellini analyst for guidance on how to get ahead of the sunset and optimize a transition plan and timeline that best suits your institution.
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