Shapeshifters

By Retail Technology | Thursday October 6 2022 | UPDATED 07.10.22

Matthew Müller, European Head of Technology at global digital consultancy Appnovation, explains why why composable IT is the secret to agile CX in an age of retail upheaval

These days, ecommerce lives and dies on the mantle of great CX; a recent eMarketer survey found that a massive 88% of consumers view the experience a company provides as "as important as its product or services." The very same need is driving a mass migration to composable IT, with 60% of IT decision-makers naming CX as the key reason for making the transition, according to the 2022 MACH Alliance report.

The logic makes sense when you consider the scope of this new-gen tool kit. A composable IT structure is a bit like a box of Lego, allowing ecommerce brands to choose from specific components and put them together in a way that suits their bespoke needs.

Rather than being stuck with a slow-moving monolithic tech stack, composable is about integrating separate IT elements via APIs and microservices. As such, composable forms the basis of a flexible and responsive approach, enabling retailers and CPGs to overhaul their CX at speed.

The switch to a composable model is not without challenges, however. In the MACH Alliance study quoted above, company leaders raised a miasma of issues, including internal resistance to change and the dilemma of weaning off pre-existing IT relationships.

In other words, adopting composable architecture isn't just an engineering puzzle. To work effectively, it requires a paradigm shift in culture, too. Here are three ways that brands can break down barriers and manage the jump to composable seamlessly:

1. Start with incremental steps: Few organisations can abandon existing IT systems and start over with a green field tech stack, not least because of the significant upfront costs such a move would entail. Instead, steady players will win the race, assuming a careful strategy that considers potential migration risks – such as interrupted service – and the strain on IT teams to manage multiple vendors at once.

The best approach in this situation comes from starting small, learning quickly and continuously improving. Organisations have two choices. Firstly, they can build their new composable infrastructure alongside their existing stack, reducing the legacy architecture over time. One option in this instance would be to launch for the first time in a secondary market and then take note of the challenges. Secondly, brands can carve out one functionality at a time and replace it with a microservice, progressively replacing all the capabilities of their legacy systems.

2. Reframe the project's purpose: Ripping out a company's IT system and replacing it may seem like a chore too far. So to energise teams involved in this monumental shift, it's important to position technology as a value driver, not a cost centre. This approach may sound simple – but it runs counter to the cultural attitudes of many retailers. Many traditional companies see IT as a way to do things more cheaply – not as a means of unlocking additional revenues and opportunities. Inevitably this can lead to a play-safe attitude, which creates gaps for innovative competitors to gain a foothold.

This is where the principle of continuous improvement plays a crucial role, offering organisations a way to understand value creation by prioritising small yet impactful changes. Our client, plant-based food and beverage brand Alpro, embraced continuous improvement and has reaped the benefits of having reframed the purpose of their tech stack. In Italy, we partnered with them to build a minimum viable D2C platform that contributed to a 33.9% increase in revenue generation when it launched. Alpro has since leveraged this solution to better serve B2B customers, too.

3. Tighten governance without sacrificing flexibility:Composable architecture is, by nature, flexible. It allows organisations to grow organically over time, responding to internal and external pressures without a rigid, centralised structure to constrain growth. But without a strong governance system, there is a high risk of ending up with multiple microservices that enable the same capability. Not only does this increase operational costs, it also dials up pressure on vendor management and maintenance teams.

To sidestep this problem, one solution is to create a task force dedicated to governance at a global level. The team's function should be to monitor and maintain the composable tech stack with a mission to enable and empower individual markets. They should also be able to set constraints on requests to add to the existing tech stack. The purpose of this governance is not to enforce a set of dictated tools but to help IT serve their customers better while strategically planning additions to expand these capabilities.

Final thought

Truly composable organisations are inherently customer-centric and dedicated to exceeding expectations. Any retail brand can embrace composable by taking an incremental approach to tech strategy and layering it with the right cultural attributes and governance systems. Jettisoning legacy IT systems may seem like a big challenge, but it's also a move that will reap major benefits – making retailers more responsive in an age of continual change.

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