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Business systems and the widening chasm of “more”

Yoni Argaman

December 27, 2022

5

min read

During a downturn, companies switch focus. Suddenly, success is less about growth and much more about margin and profitability. To paraphrase Warren Buffet, when the tide goes out, no business wants to be caught swimming naked.

In this environment, the phrase “do more with less” spreads like a pathogen. Suddenly everyone’s trying to achieve the same if not more growth and productivity with fewer resources—slimmer budgets, fewer people, less tools. And on top, they want to reduce risk and liability—not despite the growing compliance burden, but because of it. 

These topics are like an iceberg splitting beneath business applications teams (what we call ‘business engineers’) who are left straddling an ever-widening gap. All eyes are on them to do the more-est with the least-est. Today I’ll share seven reasons why that’s harder for them to do than ever—and also what top teams are doing about it.

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The widening chasm of “more”

I think it’s pretty well-accepted at this point that your business systems, together, constitute an internal product. They’re the operating system upon which businesses run, and when that product is inefficient—when companies can’t process changes, update configurations, or respond to the market—they suffer. 

I think it’s also well accepted that this space has grown fantastically complex with alarming speed. This ratchets up the complexity and thus difficulty of guiding your business systems and workflows to their desired state. 

Here are eight trends that compound that pain and widen the chasm:

1. More business systems to manage

Depending on how you want to count it, midsize and larger companies have between 147 and 976 business systems, and that latter measure grew 16% in just the last year. Though just one-quarter of internal applications are managed by IT, that number is still in the hundreds.

Suffice it to say, IT teams have a lot of systems to think about. 

2. More complex business systems

Core business systems are growing more complex. They’ve evolved from tools into platforms. From point solutions into suites. They offer more features and will continue to release more. So while the fissure widens with the overall number of applications, it is also deepening. 

3. More environments, history, and dependencies within those systems

Running a company is growing more complex too. As business systems give companies the room to sprawl, those companies are doing so and filling all those add-ons, modules, and features with more environments, history, and as a result, dependencies. 

4. More connectivity and interoperability between systems

Of those 976 systems, 28% are interconnected. Granted these integrations aren’t all bidirectional, aren’t all equally complex, and don’t run between every system, but back-of-the-napkin math using Metcalfe’s equation says that’s thousands of interrelationships. 

(If you have 100 applications that are all interconnected, that’s 4,950 interconnections. If you add 50 applications, it more than doubles to 11,175.)

5. More and more hands touching the systems

IT teams aren’t growing larger, but there are generally more users per application, and more are being given “no code” configuration access so IT is less of a bottleneck. That’s more hands that don’t know what the other hands are doing in systems built for users to move freely, but not for admins to maintain control. 

6. More complex pricing models, like consumption

There’s greater pressure to experiment with new business models. Forty-four percent of software as a service companies offer usage-based pricing, and another 23% say they’ll experiment with it in 2023. That puts demand on business systems to do things they might not have been built to do. As Casey Koon, Senior Director of Business Applications at New Relic recently shared, his company was able to experiment with usage-based pricing only because the business systems teams switched from an internal monolithic finance app to Zuora.

7. More people leaving, joining, and onboarding

Turnover in engineering, software development, and IT is high. IT has historically had an 11% turnover rate and rising. Forty-two percent of engineers are thinking of quitting right now. With each departure goes valuable configuration knowledge and history and it’s rarely documented. This constitutes a perpetual “unlearning” of your systems that you have to compensate for. And that’s on top of the fact that more systems drag out onboarding, so it takes longer.

8. More compliance burdens—especially around going public

Globally, compliance costs companies $213 billion, and 62% of companies say they’ll have to devote more resources to it in the near future. Part of the reason is a flight of new regulations going into effect over the next two years in the U.S. and Europe, which range from anti-money laundering to sustainability. And getting a company in shape to go public can cost between 3.5% to 7% of public offering proceeds, says PwC—much of it because of compliance work.

All this burden falls hard on business systems teams, and these applications weren’t built for this.

So how are business engineers responding? How are they straddling the gap?


Business engineers are rethinking, reorganizing, and rewriting their infrastructure

Broadly, they are: 

Relishing the newfound responsibility

Teams I’m talking to aren’t happy about the economic situation, but they also aren’t sad their projects are suddenly being shortlisted and funded. The “more with less” mandate puts them in the locus of control for supporting new business models, consolidating systems, and reimagining workflows to reduce work toil. 

The “more with less” mandate puts them in the locus of control for supporting new business models.


Thinking about workflows, not just systems

It’s the workflow that companies really care about—like go-to-market or hire-to-retire pipeline. Business engineering teams are reorganizing around groups responsible for workflows, not just specific systems. That means they’re reorganizing to think about “constellations” of applications that together serve and govern a business process. (See: Intercom.)

Organizing into centralized business engineering teams

More and more teams are realizing that application-specific teams create silos that companies can’t afford right now. They’re triaging requests from the business as if it’s all one internal product—which it is. (See: Monday.com.)

Building an infrastructure orchestration layer

Nobody’s going to effectively straddle the chasm of “more” with additional headcount. Business engineering teams are building an orchestration layer to coordinate workflows that span systems. It also gives them greater visibility into and control over their systems, often in a declarative interface that lets them practice methodologies like Agile and DevOps—and DevOps is just a start. (See: New Relic.) 

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Learn how to compare your environments and move changes between them seamlessly

Book a free demo

Learn how to compare your environments and move changes between them seamlessly

Book a free demo

A mechanized bridge over the chasm of “more”

Business systems teams face a chasm of “more.” More systems. More environments. More interoperability. More hands. More business models. More compliance. But notably, not more people. 

To adapt, they’re organizing around workflows. They’re centralizing that business engineering team. And they’re building an orchestration layer based on Agile and DevOps principles. All that is allowing them to do much more with much less in a time when all eyes are on them.

WRITTEN BY OUR EXPERT

Yoni Argaman

VP Marketing

Yoni is the VP Marketing at Salto. A veteran of Fyber, Yahoo and Amazon, where he held marketing and product roles, Yoni is passionate about basketball, writing and traveling and is a devoted Tolkien fan.

Sort by Topics, Resources
Clear
Thank you! Your submission has been received!
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Salto for

Business Engineering

Business Engineering

SHARE

Business systems and the widening chasm of “more”

Yoni Argaman

December 27, 2022

5

min read

During a downturn, companies switch focus. Suddenly, success is less about growth and much more about margin and profitability. To paraphrase Warren Buffet, when the tide goes out, no business wants to be caught swimming naked.

In this environment, the phrase “do more with less” spreads like a pathogen. Suddenly everyone’s trying to achieve the same if not more growth and productivity with fewer resources—slimmer budgets, fewer people, less tools. And on top, they want to reduce risk and liability—not despite the growing compliance burden, but because of it. 

These topics are like an iceberg splitting beneath business applications teams (what we call ‘business engineers’) who are left straddling an ever-widening gap. All eyes are on them to do the more-est with the least-est. Today I’ll share seven reasons why that’s harder for them to do than ever—and also what top teams are doing about it.

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The widening chasm of “more”

I think it’s pretty well-accepted at this point that your business systems, together, constitute an internal product. They’re the operating system upon which businesses run, and when that product is inefficient—when companies can’t process changes, update configurations, or respond to the market—they suffer. 

I think it’s also well accepted that this space has grown fantastically complex with alarming speed. This ratchets up the complexity and thus difficulty of guiding your business systems and workflows to their desired state. 

Here are eight trends that compound that pain and widen the chasm:

1. More business systems to manage

Depending on how you want to count it, midsize and larger companies have between 147 and 976 business systems, and that latter measure grew 16% in just the last year. Though just one-quarter of internal applications are managed by IT, that number is still in the hundreds.

Suffice it to say, IT teams have a lot of systems to think about. 

2. More complex business systems

Core business systems are growing more complex. They’ve evolved from tools into platforms. From point solutions into suites. They offer more features and will continue to release more. So while the fissure widens with the overall number of applications, it is also deepening. 

3. More environments, history, and dependencies within those systems

Running a company is growing more complex too. As business systems give companies the room to sprawl, those companies are doing so and filling all those add-ons, modules, and features with more environments, history, and as a result, dependencies. 

4. More connectivity and interoperability between systems

Of those 976 systems, 28% are interconnected. Granted these integrations aren’t all bidirectional, aren’t all equally complex, and don’t run between every system, but back-of-the-napkin math using Metcalfe’s equation says that’s thousands of interrelationships. 

(If you have 100 applications that are all interconnected, that’s 4,950 interconnections. If you add 50 applications, it more than doubles to 11,175.)

5. More and more hands touching the systems

IT teams aren’t growing larger, but there are generally more users per application, and more are being given “no code” configuration access so IT is less of a bottleneck. That’s more hands that don’t know what the other hands are doing in systems built for users to move freely, but not for admins to maintain control. 

6. More complex pricing models, like consumption

There’s greater pressure to experiment with new business models. Forty-four percent of software as a service companies offer usage-based pricing, and another 23% say they’ll experiment with it in 2023. That puts demand on business systems to do things they might not have been built to do. As Casey Koon, Senior Director of Business Applications at New Relic recently shared, his company was able to experiment with usage-based pricing only because the business systems teams switched from an internal monolithic finance app to Zuora.

7. More people leaving, joining, and onboarding

Turnover in engineering, software development, and IT is high. IT has historically had an 11% turnover rate and rising. Forty-two percent of engineers are thinking of quitting right now. With each departure goes valuable configuration knowledge and history and it’s rarely documented. This constitutes a perpetual “unlearning” of your systems that you have to compensate for. And that’s on top of the fact that more systems drag out onboarding, so it takes longer.

8. More compliance burdens—especially around going public

Globally, compliance costs companies $213 billion, and 62% of companies say they’ll have to devote more resources to it in the near future. Part of the reason is a flight of new regulations going into effect over the next two years in the U.S. and Europe, which range from anti-money laundering to sustainability. And getting a company in shape to go public can cost between 3.5% to 7% of public offering proceeds, says PwC—much of it because of compliance work.

All this burden falls hard on business systems teams, and these applications weren’t built for this.

So how are business engineers responding? How are they straddling the gap?


Business engineers are rethinking, reorganizing, and rewriting their infrastructure

Broadly, they are: 

Relishing the newfound responsibility

Teams I’m talking to aren’t happy about the economic situation, but they also aren’t sad their projects are suddenly being shortlisted and funded. The “more with less” mandate puts them in the locus of control for supporting new business models, consolidating systems, and reimagining workflows to reduce work toil. 

The “more with less” mandate puts them in the locus of control for supporting new business models.


Thinking about workflows, not just systems

It’s the workflow that companies really care about—like go-to-market or hire-to-retire pipeline. Business engineering teams are reorganizing around groups responsible for workflows, not just specific systems. That means they’re reorganizing to think about “constellations” of applications that together serve and govern a business process. (See: Intercom.)

Organizing into centralized business engineering teams

More and more teams are realizing that application-specific teams create silos that companies can’t afford right now. They’re triaging requests from the business as if it’s all one internal product—which it is. (See: Monday.com.)

Building an infrastructure orchestration layer

Nobody’s going to effectively straddle the chasm of “more” with additional headcount. Business engineering teams are building an orchestration layer to coordinate workflows that span systems. It also gives them greater visibility into and control over their systems, often in a declarative interface that lets them practice methodologies like Agile and DevOps—and DevOps is just a start. (See: New Relic.) 

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

A mechanized bridge over the chasm of “more”

Business systems teams face a chasm of “more.” More systems. More environments. More interoperability. More hands. More business models. More compliance. But notably, not more people. 

To adapt, they’re organizing around workflows. They’re centralizing that business engineering team. And they’re building an orchestration layer based on Agile and DevOps principles. All that is allowing them to do much more with much less in a time when all eyes are on them.

WRITTEN BY OUR EXPERT

Yoni Argaman

VP Marketing

Yoni is the VP Marketing at Salto. A veteran of Fyber, Yahoo and Amazon, where he held marketing and product roles, Yoni is passionate about basketball, writing and traveling and is a devoted Tolkien fan.