One of the biggest challenges many companies face in the move to a digital-first, omnichannel experience in all facets of their business (e.g., sales, service, and support) is delivering a competitive Customer Experience (CX). Today, CX is no longer about delivering positive one-off experiences. It’s about optimizing connections between digital experiences and applications to facilitate a continuous CX.
Gartner says it’s time to update your CX strategy
Maybe you’ve heard of Gartner’s Pace-Layered Application Strategy. Maybe you haven’t. In either case, here’s a refresher course: Gartner has defined 3 application categories (aka “layers”) to distinguish application types and help organizations develop better strategies for each one. They are: systems of record, systems of differentiation, and systems of innovation. In essence, these layers correspond to the concept of business leaders having common ideas, different ideas, and new ideas. Gartner explains that applications can be classified differently in different companies, based on their usage and relationship to the business model; and that applications can be expected to move among layers as they mature and/or change, or as the business process shifts from experimental to well-established to industry standard.
We recommend that you imagine your technology as the 3 layers of a house: interior design (systems of innovation), layout and key features of the house (systems of differentiation), and the foundation (systems of record). And just think — without cohesion among the 3 layers, your imaginary house can develop dry rot.
Relating pace layers to technologies
While the house analogy works, in order to initially sort technologies into those 3 categories, you need to use the following deciding factors: the cost of the technology, the lifespan of the technology, and the thinking around the technology.
For instance, some examples of systems of innovation are mobile apps, portals, gamification, and email marketing. These are applications that are built to address new business requirements or opportunities — designed to dazzle and delight on a one-off basis. Some examples of systems of differentiation are helpdesk, project management, and BI/analytics. These are applications that enable unique company processes or industry-specific capabilities. Lastly, some examples of systems of record are HCM, billing/accounting, and master data systems. These are packaged applications or legacy, homegrown systems that support core transaction processing and manage the organization’s critical master data.
Much like the idea of layers in the architecture of your imaginary house, these very real technological layers need to work together to support the integration of processes and data in business over time. In order to help manage the integration of processes and data (and maintain cohesion among the different layers), your organization will need to invest in connective technologies. As Gartner says, “Connective technologies are enabling tools that help tie applications together, and provide a means for organizations to extend the value of their current applications, or to create new capabilities on top of the existing portfolio.” There are some common elements of what Gartner calls “connective tissue”:
- Master data management.
- Process and data integration.
- SOA governance repository.
- Composition technology.
- Identity and access management architecture.
In order to make these connections, a governance structure needs to be in place. While organizations understand the governance needs associated with systems of record (i.e., legacy and/or homegrown systems), governance of systems of differentiation and systems of innovation may vary depending on the business processes they support. Gartner says these differences may show up in change management processes, architecture and platforms, funding models, development methodologies, business participation, and the length of the planning horizon for the application.
How to get started with governance in pace layering
Learning and implementing such governance structures doesn’t happen overnight. Management teams need to learn from successful governance structures in place and work to replicate the best practices across other assets. Gartner provides one effective strategy: to place managers from your business in the position of chairing pace-layered governance activities. This rids IT of the impression that they’re trying to use governance to achieve their own agenda. There’s a good deal of considerations to take into account when deciding on a strategy for each layer and for the relationship between layers. Understand that your approach may differ from layer to layer, but remember that the dynamic across all layers is critical to the success of your technology strategy. Greater connectivity lends itself to a better omnichannel experience for your customers from the get-go.