Unlocking legacy assets with an internal digital platform
FYI, this story is more than a year old
Article written by ThoughtWorks Australia head of technology Scott Shaw
In traditional organisations, leaders have spent many years building new business capability and investing in the modernisation of legacy systems and processes. The pain of integrating change across siloed assets was considered an unfortunate, but inevitable part of remaining relevant in an ever-changing marketplace.
Today, the playing field has changed. Large-scale enterprise finds itself competing with digital-first startups, who have the flexibility to adapt quickly and disrupt the market without the baggage of existing technology, processes and culture.
But all is not lost for the goliaths of industry. Decades of investment have created a wealth of business assets, including technology systems, an abundance of data, strong brands and deep customer relationships. If these organisations can unlock their assets from their legacy prisons, they too can deliver on new business ideas quickly and create a significant competitive advantage for themselves.So, how exactly do they do that?
To be successful, organisations must shift their thinking from integrating multiple systems across the business, to building a platform. The term “digital platform” has gotten a lot of traction recently, and can be interpreted in several different ways. But in this context, we are talking about creating an ecosystem for sharing organisational capabilities, that enables small, autonomous teams to execute business ideas or conduct experiments at speed.Platforms for Execution
Effective digital platforms are built on a foundation of tools and services, and platform assets must be aligned to a company’s organisational structure and business operating model. This alignment empowers teams to work autonomously, consuming each other’s capabilities in a self-service way without the need for centralised coordination. BBVA, a FinTech company based in Spain began their digital transformation back in 2014. They recognised the need to change their technology platform to connect it to a more modular and flexible infrastructure. This change was a key enabler for them to be able to solve very specific customer problems quickly.
For example, BBVA customers can now order a new bank card in 45 seconds online, and have it delivered to them within 24 hours, compared to the previous 5-day timeframe. A strong technical foundation is only one (albeit important) piece of this puzzle. If BBVA had not had the appropriate business model, and supporting processes in place, this functionality would never have made it out into the hands of their customers.Platform as a Product
In examining the qualities that make an effective platform, we must first consider the platform internally as a product. A product needs to be compelling in order for customers to use or consume it, and an internal platform can be no different.
It is difficult to change people’s habits, so it is important to consider simplicity and usability when we design a platform, providing a convincing reason to use it over a previous solution, or an external service. We create this reason by ensuring that we remain customer-focused. If we listen to the voice of the customer, we can ensure that we build something that they actually need, instead of what we assume they might want. In the traditional enterprise, so much attention is placed on the concept of ‘re-use’, when, in reality, we should just start by building something that will be actually be used in the first place. When we talk about the customer, it is too easy to focus on the end customer of our company’s product or services, without giving too much thought to our internal customers. This is a big (yet common) mistake. In order to allow our colleagues to service the end customer effectively, we must provide them with a solid supporting ecosystem to do so. Failure of adoption is common when intended users are unaware of the services available to them. Investment must be made in internal marketing, creating champions for new services and actively supporting users as they come on board to increase levels of engagement with the platform.Platforms must be self-service
Our internal customers can often be found in separate silos, working on backlogs of work that are tightly coupled with those of other teams across the organisation. This is where the difficulty begins, as delivery teams try to coordinate the work that needs to be completed to execute change. In reality, each group needs to be able to work autonomously to be successful. Part of being autonomous is self-service. Putting manual infrastructure provisioning behind an API and calling it cloud won’t get the results we want to achieve, as we still rely on human intervention to complete the process. The time and manual coordination required in this instance becomes a barrier to achieving a task. To be truly self-service, the API must trigger an automatic, instantaneous response, and be consumable without the consumer ever having to ask for assistance. The concept of self-service is also applicable to our data assets. Organisational data must be safely open by default, and discoverable by all, to provide the most value to an organisation. If data is accessible and of a reliable high quality, it can be used to measure experiments, understand customer behaviours and to make decisions that allow us to pivot accordingly.Platforms need to enable ecosystems.
Creating an effective internal platform requires the creation of a platform ecosystem consisting of both producers and consumers. By putting boundaries around the complexity of a system or business capability, instead of pushing that complexity to the consumer of services, we make it simple for new participants to get up and running quickly.
This helps to create a flourishing ecosystem because these consumers then become producers of data, which is the currency that flows through the system- making it more valuable to the whole organisation.
Macquarie Bank has a mature delivery capability, using agile techniques to meet customer needs quickly. In order to further boost and personalise their customer’s banking experience, they saw the need to build a new open online banking platform, giving customers more control over their banking data, as well as the power to securely manage how they decide to share it.
In creating the platform, they saw the value in using a variety of technologies, rather than a rigid adherence to one technical solution, as well as creating small, reusable services and making their data lake easily available to all. The flexibility of their resulting platform allows them to move from idea to new service at speed.Where should you begin?
Start with your business strategy, mapping out the core business capabilities required to achieve it, as well as identifying where these capabilities are shared across the business. These can then become the basis of the services that you need to build out.
Providing strong leadership is an important part of setting your platform up for success. A leader must make it explicit to platform owners that the platform should be the key consideration in decision-making, and ensure that reward structures reflect this priority.REA has done this particularly well, creating an internal brand for their technical building blocks.
Components that receive the 'Colab' endorsement are useable by teams across the organisation. Empowering delivery teams allows decisions made on the ground to reflect the higher level strategy, supported by strong leaders who define and champion the platform vision.
Finally, your platform cannot be bought off the shelf. You can certainly buy parts of the platform; software tools and consulting, but that doesn’t address the mindset and change in operating model that a true platform for execution requires.
Done right, your platform is your most powerful asset, a competitive differentiator that sets up your organisation to respond to ever-changing customer needs and wants. This means that it must be tailored to the idiosyncrasies of your unique organisation to best service you, and your customers.