Over the year, it’s likely your organisation has faced unprecedented challenges; the pandemic has forced leaders to re-think their business models, innovate quickly and find new ways to engage with existing and new customer bases, at a time when market disruptors continue to move into their sectors.
Business processes and customer touch points, embedded in organisations for decades, are being swept away by online and app-based companies powered by the Cloud, APIs (tools enabling products, services and systems to easily integrate with a network of partners), data analytics, mobile devices and social media.
The winners have been those with technology platforms that allow them to instantly respond to market demands, trends and disruptors, develop new business partnerships, source new revenue streams and offer additional products and services, while guaranteeing online responsiveness, performance and reliability.
Fundamental to this is an IT platform that ensures resilience, flexibility and agility; key requirements of our new era. So how is this achieved?
By embracing a modular philosophy, adding new components to existing legacy systems and reinventing your business so it becomes a Composable Enterprise. You’ll then be able to maximise your organisation’s ability to build, assemble and reassemble core business elements, rapidly seize market opportunities and respond to disruptors and threats, while maintaining resilience.
The definition of compose is to ‘form by uniting parts’ and a modular strategy does just this, it allows you to connect to new ecosystems, exposing your business to new markets and revenue streams.
Global IT research and advisory firm, Gartner, describes a Composable Enterprise as ‘an organisation that adapts to the pace of change and delivers business outcomes. It does this through the assembly and combination of Packaged Business Capabilities (PBCs) – application building blocks that have been purchased or developed’.
By using interchangeable building blocks (software), you can create, innovate and adapt your business operation, respond to external (or internal) factors and have the agility needed to evolve and grow.
Greater modularity ensures customers can interact with your business via different delivery channels and touch points, using their preferred communication medium.
The first step is to rethink your business model and include within your growth strategy the implementation and maintenance of PBCs (the apps). And when looking at business continuity, have you considered the threat posed by outdated business models? Preparing for disruptions to resources and processes is common, but how much thought has gone into external disruptors? Greater autonomy builds resilience.
As a composable architecture blurs the boundaries between business and IT, giving customers more unique and customised application processes, it’s equally important to involve all stakeholders in the architecture construction process. When developing a composable business you need to change your strategy, architecture and technology.
Strategy – anything is composable so follow this thought process when developing a strategy. Where do you see your business in the future, what ecosystems, in and outside your sector, can you connect with? Composable thinking, coupled with modularity, autonomy, orchestration and discovery should provide the framework and timeline for idea conceptualisation.
Architecture – by enhancing your structural capability you’ll have mechanisms to adapt and repurpose your propositions.
Technology – composable software components (normally accessed via APIs and event channels) are the tools for today and tomorrow. These interconnected pieces can be co-ordinated and scaled across complex digital enterprises, driving the technology to support your product design goals, putting the theory/concept into practise.
Monoliths and Microservices
Rather than removing legacy systems – which have great business value – it’s about introducing modular technology platforms to support the building blocks already in place.
Organisations without a need to integrate and build internal systems or extend their partner base typically use a monolithic architecture to support their IT platforms (all activity relates to a single piece of software/code). A monolithic architecture however, cannot evolve quickly in line with business needs and if changes or updates are needed in one area, it’s likely the whole system will be disabled.
While it’s difficult to change and scale a monolithic application, a Microservices architecture can break its hold.
This key component connects separate or ‘decoupled’ elements within its structure, supporting interlinked software applications, enabling them to communicate via the Cloud and be managed, modified, tested, deployed and scaled, without affecting the wider operation.
While this brings flexibility when programming languages and supporting underlying technologies, it can create communication challenges as the apps may not necessarily be in the same network (something often overlooked by developers).
When beginning your Composable Enterprise journey, don’t throw away the monolith (just don’t add anything else), start with the least dependent or most decoupled service, have a clear roadmap (re-writing a monolith is not easy) and pay attention to any network communication issues.
Application Programming Interfaces (APIs) are the foundation of any Composable Enterprise. These elements share data securely across business systems, mobile applications, Cloud services etc, connecting businesses, partners and third-party providers. However they’re more than a technology facilitator, they’re strategically vital.
APIs standardise communications. While it’s important to share services, it’s equally important to focus on how they are shared; third-parties that encounter unresponsive interfaces or difficult coupling processes will have to overcome connection barriers. APIs deliver a RESTful interface that allows easy onboarding, reducing development cycles and ensuring faster delivery to customers and partners.
They also have security benefits; APIs manage and protect payment data, access control and authorisation/authentication issues – giving peace of mind to regulators, your business and customers.
Even Driven Architecture
Another key component is Event Driven Architecture (EDA). Commonly used within a Microservices architecture, it uses state or programme changes (events) to trigger asynchronous communications.
An event, or specific action such as a customer making an online purchase, is detected, triggering an automatic response without the need for validation via a request/response cycle, relieving pressure on the computer’s resources.
The focus here should be how the EDA automatically responds to customer activity. Your business should react quickly to an event within a customer journey. If it doesn’t, your customer may be tempted to go elsewhere.
And while there’s a belief other technologies can provide this service, none can manage and streamline communications in the same way. The numerous systems wanting to capture customer information (banks, acquirers, marketplaces, ERPs etc) create additional layers of complexity. In contrast, event notifications use a single tool to capture activity, such as a purchase, notifying only the system interested in this transaction.
Once you have an EDA in place, business systems can identify specific user actions and target customers accordingly, for example with a purchase confirmation or by offering products/promotions linked to an event. This makes your business more responsive, more accurate and less dependent on re-marketing (which can be costly and invasive for customers). And most importantly, it enhances the customer experience and increases your potential for scalability and real business gains.
Integration is traditionally delivered by a central team, which only allows for linear scaling and can cause bottlenecks. Modern integration trends advocate the use of ad-hoc integrators, and while this ensures faster scalability, it can create governance, consistency, security and compliance risks, plus increase technical costs.
In order to mitigate the risks and costs, software integration managers should:
- Design low-code integration platforms with different personas and robust operational/governance models (supporting rapid innovation and time to value)
- Reuse APIs that are interface entry points (instead of building new ones)
- Use a Mesh-based system (combines Microservices and APIs) to manage communication processes (will simplify and speed organisational responses)
- Use multiple Software as a Service integration tools if the time to value is slow (reducing technical and governance issues).
Make that change
A Composable Enterprise doesn’t replace a digital business; this modular approach ensures your business functions and units become autonomous, independent and paired to orchestrate business growth. It supports innovation, anticipates change and is adaptable and resilient when faced with uncertainty.
Becoming a Composable Enterprise is easier than you think. Identify where the opportunities lie within your customers’ journeys and what technology is needed to take full advantage of them, agree on your KPIs and ensure you have a workforce and vendors prepared to innovate.
About the Sensedia
Sensedia is a modern services connectivity and integration expert, providing a technology platform and services for enterprises in their journey towards a more open, connected and digital world. The company delivers API management, Microservices, Service Mesh and legacy integration enablement to innovative enterprises worldwide, enabling them to integrate digital channels, leverage ecosystems and create modern multi-cloud/hybrid architectures in a governed, scalable and secure way.
Its team take a product-minded approach for building APIs, provide a framework for business and technical governance and can support clients with an events-driven platform, playbooks relevant to the customer journey and API-strategic consulting services.
More at www.sensedia.com
About the Author
Kleber Bacili is the founder and CEO of Sensedia. He has a degree in Computer Engineering from Unicamp, an MBA from FGV and tutors in Entrepreneurship and Innovation at Stanford. He is also a partner of Fundo de Capital semente IVP.