There is little doubt the negative economic outlook for 2023 is already impacting budgets across organizations of all sizes. As economic factors continue to impact earnings and growth, executive focus often shifts to cost savings, expense reduction, and limiting strategic investment in growth initiatives. We’ve seen this trend in a number of our clients across a variety of industries: retail, insurance, high tech, and others. Our clients are often being asked to do more with less: less budget, less staff, and less time. Teams are being asked to do all of these things while also trying to meet expectations for improving business operations and productivity.
In each organization, there are various technologies to enable business execution and support the day-to-day operations. Some technologies are highly visible, such as front-end user interfaces of applications used daily, like Salesforce CRM, while other technologies work in the background and are relatively unseen. Back-end databases, cloud infrastructure, and integration software immediately come to mind. These hidden technologies are often overlooked or under-appreciated when organizations plan on evolving how they work.
Similarly, when building or renovating a house, a homeowner doesn’t typically request input into wiring runs or placement of outlets so they are often an afterthought as compared to picking out kitchen cabinets or bathroom countertops. Things that are highly visible will receive much more attention than things that are hidden behind walls or in the attic, like air conditioning ducts. However, in building a house, those connectivity items behind the scenes such as water lines, electrical wiring, and AC ducts, are critical to the comfort and usability of a house. No one wants to be in a house with limited hot water, rooms that get little to no AC, or electrical outlets that frequently trip.
In the corporate world, the importance of connectivity between systems, data, and people is often overlooked as it occurs primarily behind the scenes. And much like plumbing in a house, no one gives it much thought until something bad happens. And when the plumbing backs up, breaks, or somehow doesn’t work, things get really messy.
A lack of investment in the critical, yet hidden, components that help businesses run is often how companies stagnate and begin a march towards becoming irrelevant. The ability to change business models, attack new business opportunities, and drive new revenue streams requires strong leadership and a willingness to invest in new technologies. Perhaps even more so during economic downturns, organizations must focus on evolving via technical innovation as the best opportunities to grow often emerge from times of economic turmoil.
Capital expenditures are evaluated much more closely in times of economic uncertainty than in times of economic growth. We’re seeing a renewed focus on cost and ROI when projects are considered for budgetary approval. More than ever, there is a focus on quantifying value to the organization and senior leadership is asking for more detailed plans showing how a proposed initiative will provide a path to a positive ROI within a shortened timeline. Those initiatives that show a high probability of success, have plans to mitigate execution and change management risks, and can quantify high value are being approved and funded. One type of strategic initiative we see increased investment in is evolving to a composable enterprise. Clients are asking AVIO Consulting to help them to realize a number of benefits associated with a composable enterprise:
Increased flexibility and agility: With a composable enterprise, new products and services can be created quickly and easily by combining existing components, rather than having to build everything from scratch. This allows the organization to respond more quickly to changes in the market and to take advantage of new opportunities.
Improved efficiency: By reusing existing components and resources, a composable enterprise can reduce costs and improve efficiency.
Greater scalability: A composable enterprise can easily scale up or down as needed, by adding or removing components as required.
Better collaboration: With a composable enterprise, different parts of the organization can work together more effectively, by sharing data and services in a standardized way.
Innovation: A composable enterprise allows the organization to continually create new products and services, and to take advantage of new technologies and business models.
One of our clients in particular is leveraging strong, results-oriented leadership to kick off this month one of their most ambitious, and transformative, initiatives to date.
The IT leadership at our client has enabled the organization to change how they think about hidden, connective technologies, such as integration, to enable a composable enterprise. IT leadership created a culture that prioritizes standardization and usage of frameworks to accelerate development timelines. They have standardized on an API first integration strategy as they transition away from their historical point to point model used in their siloed development teams. In addition, a focus on reusability has driven adoption of design patterns and frameworks that ensure development consistency. One ancillary advantage of the focus on reusability is the ability for developers to transition between projects and already be familiar with the tools and frameworks used. There has been significant reduction in ramp up time on projects as a majority of the development teams are sharing tools and frameworks.
In addition to the standardization advocated by IT leadership, to further reduce risk our client undertook smaller projects to validate a number of assumptions that were critical to the larger initiative. For example, MuleSoft was used across multiple tactical projects to validate the platform could provide the speed of delivery and architectural capabilities needed for the strategic program. We worked with our client to apply the AVIO ethos of Think Big, Start Small, Act Fast and validated numerous design patterns, identified architecture models, and developed a strong understanding of how to best leverage the MuleSoft platform to derisk the integration and connectivity needs in their strategic initiative.
Organizations adopting a composable enterprise strategy will be able to adapt to changes in how clients and employees interact and enable business units to operate in ways not limited by the underlying technology. Our client found using modern software development principles and an API-led approach provided them with the design standards and implementation practices that could easily and quickly be shared by multiple business units. Having consistency will help to minimize future technical debt, drive value through creating innovations that are able to be integrated quickly, and will fundamentally change the way business and IT work together. Data contained within historically siloed businesses, like product and operations data, will now be shared in real time via well defined and documented APIs. This real time data access will drive significant opportunities in building fit for purpose applications, improving internal and external user experiences, and will increase the speed in which our client’s planned mergers and acquisitions are fully integrated.
While technology is critical to enabling a composable enterprise, there are also organizational considerations required to ensure the ROI and value of the initiative is met. Conway’s law states that an organization’s software systems mirror their own communication structure. To overcome this, AVIO helps our clients to adopt a holistic approach to API design and development. This approach enables different parts of the organization to communicate and share data with one another in a standardized way and is a key prerequisite to quickly adapt to constantly evolving market conditions.
AVIO is committed to helping our clients adopt modern application development practices and strategies as our clients strive to grow and increase productivity despite economic headwinds. We are focused on helping our clients become composable enterprises designed to be more adaptive, flexible, and responsive to change, and to be better equipped to take advantage of new opportunities as they arise.
Do you need a thought partner to help you navigate the API economy? Please contact me at api.economy@avioconsulting.com.