COVID-19 changed the way enterprises do business, triggering unprecedented volatility. Existing leadership and technology principles are not adapted to thrive in this new world. This year at Gartner IT Symposium/Xpo 2021 EMEA held virtually from November 8 to 11, the CIO and Technology Executive Agenda explored the leadership actions necessary to maximize business value delivery during this period of volatility.

Mastering business composability

According to Gartner's annual survey of 2,387 CIO and technology executive in 85 countries and from all major industries, enterprises must embrace business composability to thrive through disruption in 2022 and beyond.

Business composability is the mindset, technologies, and set of operating capabilities that enable organizations to innovate and adapt quickly to changing business needs. It is built on applying the key principle of modularity to business assets to achieve the scale and pace required of business ambition.

"Business composability is an antidote to volatility", said Monika Sinha, research vice president at Gartner. "63% of CIOs at organizations with high composability reported superior business performance compared with peers or competitors in the past year. They are better able to pursue new value streams through technology, too", she added.

Investments in AI, cloud and security technologies support business composability

Artificial intelligence and distributed cloud are the two main technologies that a majority of high-composability enterprises have already deployed or plan on deploying in 2022. These technologies are a catalyst for business composability because they enable modular technology capabilities, as reported by Gartner analyst.

The survey reveals that cyber and information security is at the top of the list of planned investments for 2022, with 66% of all respondents expecting to increase associated investments in the next year. This is followed by business intelligence and data analytics (51%), and cloud platforms (48%). "There is a continued need to invest in cybersecurity as the environment becomes more challenging. A high level of composability would help an enterprise recover faster and potentially even minimize the effects of a cybersecurity incident", noted Monika Sinha.

High-composability enterprises leverage IT better

Gartner's report shows that, on average, high-composability enterprises expect greater increases in revenue and IT budget in 2022 than their moderate or low-composability peers. In 2022, surveyed CIOs and technology executives at high-composability enterprises expect their revenue and IT budgets to grow, on average, by 7.7% and 4.2%, respectively, while low-composability enterprises only expect both to increase by 3.4% and 3.1%, respectively. "Most high-composability enterprises set up strategic planning and budgeting as a continuous and iterative activity to adjust to change more easily", explained Monika Sinha. "Without big deficits to remedy elsewhere, CIOs can afford to invest in composability, especially for IT developers and business architects who can design in a composable manner", she observed.

Globally, IT budgets are expected to grow at the fastest rate in over ten years, with an average growth of 3.6% in overall IT budget for 2022 reported among all survey respondents.

Three domains of business composability

With volatility serving as a business driver for the foreseeable future, CIOs are in a unique position to advance the three domains of business composability identified by Gartner analysts: composable thinking, composable business architecture and composable technology.

Composable thinking

"Business composability is not uniformly high across the economy because it requires business thinking to be reinvented", said Monika Sinha. "Traditional business thinking views change as a risk, while composable thinking is the means to master the risk of accelerating change and to create new business value".

This way, CIOs leading high-composability enterprises recognize that business conditions often change, from customer demands to financial models, and empower the teams that are closest to the action to respond to those new conditions. For instance, over half of high-composability respondents said they promote a high-trust culture that encourages employees to independently make decisions, which is double the percentage of moderate- composability enterprises and six times more than low-composability ones.

Monika Sinha cited the example of Centerra Gold, a mining company that rethought the way they led IT and took the time to understand how composability could impact their business. As reported by Centerra Gold's VP Information & Technology, composability was key to create an ecosystem that effectively delivers on flexibility, integration, and the power of data.

Composable business architecture

Gartner observed that industrial era businesses were designed for stability and slow, predictable change. In the digital era, business architectures need to be designed for uncertainty and continuous change. Instead of optimizing for efficiency, the composable enterprise optimizes for adaptability. Systems, processes and workers no longer serve one predetermined use case or purpose.  

"Digital business initiatives fail when business leaders order projects from the IT organization and then elude accountability for the implementation results, treating it as just another IT project", noted Gartner's research VP. "Instead", she said, "high-composability enterprises embrace distributed accountability for digital outcomes, reflecting a shift that most CIOs have been trying to make for several years, as well as creates multidisciplinary teams that blend business and IT units to drive business results".

Composable technology

"Business runs on technology, but technology itself must be composable to run composable businesses", Monika Sinha pointed out. "Composability needs to extend throughout the technology stack, from infrastructure that supports rapid integration of new systems and new partners to workplace technology that supports the exchange of ideas". She explained that Gartner's survey revealed that CIOs and technology executives in high-composability enterprises have pushed forward more aggressively when it comes to iterative technology development, sharing data across systems and people, and building out integration capabilities data, analytics and applications.

To illustrate this, Monika Sinha called on the testimony of Carlo Gambucci, CEO of SIGI, the shared service center of Luxembourg municipalities, the new platform of which -SIGINOVA - was made from composable and interchangeable building blocks. From low-code language, to the ecosystem and the components, to the customer-facing layer, every technology part of SIGI's platform fall within the same fundamental logic of composability.

"CIOs at moderate or low-composability enterprises must internalize these three domains of business composability to make their organization nimbler and well equipped to handle the rapidly changing business environment in which they operate", said Monika Sinha. "It’s a gradual, but imperative, process going into 2022 and beyond", she concluded.