Personally I do not think kata should be modified or changed intentionally. Enough changes creep in over the years as it is, and when people started changing things, is when karate's efficacy went down the drain.
Human to human conflict is the same today as it was 500 years ago, a punch is a punch, a kick is a kick. The biggest difference to me is that we have to worry more about guns.
Other than that, I think kata are neither effective, or ineffective. Kata don't fight, people do, and if you think you're going to use your kata in a fight literally, you're missing the point. (not you personally, just in general)
Regardless of what era it is, there are certain things about unarmed combat that will never ever change (most likely) in my opinion. It is these things which the traditional arts record.
I often say we study "martial" "arts"...we need to learn to separate the "art" of karate, from the "martial" or self defense. Karate (or any other art) is not fighting, it's a way to learn things ABOUT fighting (and many other things). It is then up to us as practitioners/students to put it into a modern context, and practice it as such through 2 person training, whether it be static ippon kumite, all out sparring, or something in between.
I do personally believe when people refer to kata as the "heart" of karate, and when the old masters (as well as contemporary ones) say "do kata" "practice kata daily" etc...they're not referring to the solo performance of the kata.
Each kata should represent a distinct "phase" of training, and your entire training regimen (sparring, bunkai, oyo, drills, everything) should focus on the general concept the kata is trying to teach you.
For example Iain Abernethy teaches that pinan shodan is all about intercepting the attack before the person has their hands on you. This is good because many attacks can be intercepted,..ie..you don't have to let the person grab you to defend against it, and it's wise not to, so the lesson is strategic as well as physical, and it represents the first phase of physical violence. (philosophically: prevent/avoid it. Physically: intercept it before it's successful)
At this "phase" of training your entire karate life should focus on the idea of intercepting attacks. Your kata applications, drills, sparring, etc should all reflect this basic idea. You should eat, sleep, and sh*t ''interception'' until you move on to the next kata.
The general concept of the kata is much more important that finding 10,000 different applications for a rising block. Focusing on the concept also allows you time to actually practice and somewhat internalize the teachings before you move on. Simply finding a bunch of applications of your kata doesn't because you're too busy finding more and more techniques, and practice none of them to proficiency.
Just my two cents...ok it's more like a dollar.
you can do anything you want to...you just cant always do it alone
to ask is a moments shame, not to ask, and remain ignorant is a lifelong shame