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Why Large Enterprises are Moving to Platform Strategies

Tony Brownlee
6/14/17 6:30 AM

Many enterprises are looking to platform strategies as a way to lower long-term maintenance costs while taking advantage of more software innovation. This term platform is a word we areThinkstockPhotos-524706116.jpg all hearing more and more in the software world. But why Platform?  Why now?  I can't speak to all platform strategies, but I can explain why we at Kingland think platform is compelling.

Our decision to move to a platform strategy started a number of years ago as we saw technology beginning to change more rapidly, cloud emerging as a viable capability, and our clients continuing to face challenging business and regulatory environments. At Kingland, "platform" is the culmination of our software strategy in this world of next generation technical capability like artificial intelligence and cloud.

In our world a Platform is a collection of many software components that provide distinct capabilities. This unique combination of capabilities differs from a hardened product as the capabilities can be used differently from environment to environment, but still provide the reliability of enterprise class software. In large, global enterprises, we've found this to be incredibly important as nearly all companies have very complex legacy environments. In particular, we find two distinct reasons why a platform strategy works for these large enterprises.

Long-term Maintainability and Costs

All business and IT leaders want the ability to use new technologies as they emerge. However, they also want to minimize the cost, complexity, and risks related to upgrades or migrations. These goals are fundamental to why we focus on a modular architecture in our Platform. Renowned business strategist Clayton Christensen has an excellent comparison of two of the most prevalent types of architectures used in the design of software as well as organizational systems - interdependent and modular.

When someone changes one piece in a product that has an interdependent architecture, necessity requires complementary changes in other pieces. Customizing a product or service, as a result, becomes complicated and expensive. Many of these interdependencies are not predictable, so all pieces must be designed interactively. Customizing a product whose architecture is interdependent requires a complete redesign of the entire product or service every time. On the other hand, modular architectures optimize flexibility, which allows for easy customization. Because people can change pieces without redesigning everything else, real customization for different needs is relatively easy. A modular architecture enables an organization to serve these needs. Modularity also opens the system to enable competition for performance improvement and cost reduction of each module. 

If you're building a software product or a system to accomplish one specific purpose, most use an interdependent architecture. This has been the approach of many software packages we've used over the years and many that our clients use today. Buy the software, install it, customize it for the unique enterprise processes and legacy systems it needs to support, and enjoy the value. However, future enhancements and maintenance end up being six month releases and quite challenging.

On the other hand, the modular architecture of a platform insulates companies from the complexity of changes like those enhancements or maintenance releases. If a platform has been designed modular from the beginning, when a new version of a machine learning algorithm or UI component is available, the upgrade of that component can be done more quickly, with less cost and complexity, as well as less risk.

Capturing Innovation

The second big advantage we see in a platform strategy is capturing innovation. The best software architects and engineers are full of great ideas. Additionally, needs are always changing, stemming from new regulations or strategic business objectives that can be met with software capabilities. On top of this, new technologies are coming out every year that can provide better capabilities. With a modular platform approach, architects and engineers can take these ideas, needs, and new technologies and make more "surgical" improvements. Rather than ripping up an existing architecture and modifying all aspects of an application, improvements can be made at the component level. The result is the ability to release new features and capabilities faster, which allows us to solve new problems for our clients, or make new improvements to existing solutions.  

While this supports our previous goal of long-term maintainability and costs, it also creates an environment where engineers can more readily implement and see their innovations. It makes proof of concept activities easier. It makes road maps more dynamic and responsive to real needs and shortens release cycles. Put another way, it makes the work more fun. In the world of enterprise software, if you can design software in a way that meets the scalability, performance, and security expectations of large, Fortune 500 companies, but also allows engineers to have fun with their development work, innovation happens.

At Kingland, we're investing significantly in a platform strategy that harnesses our 25+ years of expertise to more quickly solve the problems our clients bring to us, but in a way that delivers more value over the long run. And yes, we're having a lot of fun innovating along the way too.

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