Customers have big expectations. Getting high-quality products has always been one of them. And as more and more of our lives move online, the customer experience is really a software user experience—especially the first encounter.
Does your organization see software as an opportunity to differentiate from the competition, acquire new customers and grow your business? Or does your existing application portfolio carry so much technical debt that you feel hopelessly behind?
If you fall into the second group, you have probably also considered some form of an application modernization or digital transformation program. Retire old apps, migrate some to cloud and modernize the most critical systems using all the shiny new technologies. If this sounds familiar, then you’re in good company.
A recent global survey explored the long-time digital transformation debate. In doing so, the survey revealed key insights into why some teams are more successful than others.
High-performing organizations, for example, approach digital transformation initiatives and software development and delivery efforts very differently than underperforming organizations.**
“One of the questions I frequently ask executives of companies wanting to modernize is how quickly can you ship software?” says Edward Hieatt, SVP of Tanzu Services at VMware.
Inevitably, he says, their answer is months to quarters. And worse than just being slow, the release engineering process requires all hands on deck and still results in high failure rates and downtime. He believes that “the time it takes to go from code complete to running in production is a good proxy for the health of your technology organization.”
If you can’t ship quickly and reliably in normal times, you’re not going to respond to changing market conditions when it matters most.
On the Winning Side of Innovation
In the last few months, we’ve seen an unpredictable level of change. Many people stopped commuting to work and shopping in stores. Companies couldn’t have prepared for these exact circumstances. But those with agility built into their core business systems certainly outperformed those that didn’t.
Retailers that invested in a unified e-commerce, in-store inventory management and purchasing system quickly transformed closed stores into curbside, contactless pickup points or local delivery hubs.
One retailer using physical locations for competitive edge is Dick’s Sporting Goods. Before the pandemic, the retailer embarked on a strategy to leverage stores to build a better e-commerce experience. It launched the option to buy online and then pickup in store, which is great for people who need equipment the day of a big game or event, says Hieatt.
The game-changer for Dick’s Sporting Goods is a modern app for real-time, in-store inventory. The app allows someone to transact from home, and then show up at the store very soon afterward to pick up the item. That app experience—that customer experience—required a complete re-imagining of legacy approaches, says Hieatt. At the time, this was markedly different from almost any other retailer inventory app, which were built for truck deliveries and restocking.
Modernizing its core inventory application enabled Dick’s to unlock customer value by delivering a new feature set across channels. That’s true app and digital transformation for the future of customer experience.
Blueprint for Modern Apps Success: People, Processes & Technology
Today, Hieatt sees more enterprises investing to control their own destinies—hiring developers, adopting cloud, moving to DevOps and agile principles. But he’s unsure if leaders are consistently creating comprehensive plans that address people, processes and technology. “It’s too easy to sign a big contract with a public cloud provider and tell the team ‘we’re doing cloud.’ No single technology or tool is a universal panacea.”
Growth-Minded Leaders with Software Backgrounds
A CIO’s average tenure is 4.3 years. Among the reasons for that, Hieatt says, is these professionals must deliver against a nearly impossible goal. And that’s spending less each year without sacrificing quality, service or security. At the same time, they must support an innovation agenda that requires new features, applications and capabilities.
“Those are opposing forces that are almost irreconcilable, especially when 80-90% of a typical enterprise IT budget is allocated to simply maintaining the existing portfolio,” says Hieatt. “The only viable path I can see here is to take the bold step of modernization of the existing portfolio. Reduce operating costs and improve reliability of applications that will stay. Rebuild everything else with a focus on flexibility and resiliency. Build for the unpredictable future.”
This is one of the reasons survey respondents agree software-minded leaders have more successful businesses. CIOs have the technical backgrounds needed to extend an initial app re-architecture investment through further intelligent investment, accelerating the projects that are working and eliminating the ones that are not.
“If you’re successful in this process, it has the added benefit of lowering the costs of all your new efforts, too. A lower per-project cost means you can try more things. And if you’ve got an innovation agenda, the ability to test more good ideas means a much higher likelihood of delivering a win for your business,” says Hieatt.
Another key to modern apps success is empowering developers. When VMware worked with Liberty Mutual, for example, the insurer was focused on developing technology to keep up with evolving risk models. That meant enabling its team to engage in several projects and easily shift focus to best products—not heavily invest in one project that may be obsolete by launch, says Hieatt. As a result, the company improved speed to market.
Evolving the Platform
Rather than a revolution, Hieatt believes evolution through incremental change is the best way forward for traditional businesses.
“I’ve seen many companies approach transformation as an all-or-nothing process. Hire a consultancy, build a program office, create a multi-year roadmap. Those projects don’t tend to yield the best ROI,” says Hieatt.
Surveyed experts from high-growth companies seem to agree. In the Vanson Bourne survey, they said the potential benefits of an autonomous, self-service model for app development and deployment include:
- Improved end-user experience.
- Greater collaboration between teams.
Capabilities that once seemed out of reach to everyone—infrastructure as code, cloud for regulated industries and Kubernetes for all, for example—provide a proven migration path for modern apps for everyone. And when that’s coupled with a mindset shift about app architecture and release engineering, it drives cultural and better recruiting outcomes.
Experience Is Everything
When enterprise leaders do the hard work of aligning their people, processes and technology, they can drive competitive advantage and differentiation. And in our changed world, delivering great modern app experiences faster can make all the difference to business success and failure.
*Vanson Bourne survey, commissioned by VMware, of 5,000 app developers, business decision makers and IT decision makers during March and April 2020 across 17 countries globally.
**High-performing organizations are those growing 15%+ per year and underperforming organizations are those growing -1% per year.