Trends in the Value Selling of Software
By Tom Cissell
Customers Demand Justifications for Application Upgrades
Customers are less inclined these days to upgrade their applications just to be current. Application providers structure support and pricing policies to encourage customers to always move to the current release. There are very real complex support issues in trying to support multiple releases of software which tend to increase exponentially with the age and degree of obsolescence of the release. So, there are more than purely revenue motives on the behalf of suppliers. However, customers are showing a willingness to skip releases. They incur some disruption with the implementation of each new release, expose themselves to the risk of business interruption with the potential of new bugs being introduced into their business applications, and of course sometimes there is an upgrade fee separate from annual maintenance. The combination of these real supplier and equally real customer issues means that suppliers have to demonstrate the business value of the upgrade beyond just remaining current. A list of new features and functions is not sufficient. A compelling explanation of how the new features and functions will improve the customer’s operations in a way that justifies any cost and disruption is required. Suppliers must continue to move away from time based software releases towards content based releases to insure that there the content produces sufficient benefits to justify an upgrade.