- Companies with high interoperability not only benefit from better financial performance, but also improve their supply chain and operations by 12 percentage points; 16 percentage points better at reinventing the customer experience and 4 percentage points better at adopting sustainable business practices.
A new study by Accenture (NYSE: ACN) reveals that companies with highly interoperable business applications gain agility to thrive in uncertainty and achieve better financial performance. Last year, companies with strong interoperability -made up of one in three companies surveyed (34%)- they grew revenue six times faster than their low-interoperability counterparts and are poised to unlock an additional five percentage points in annual revenue growth. For the report, “Value Untangled: Accelerating Radical Growth Through Interoperability”, Accenture surveyed more than 4,000 executives from 19 industries in 23 countries. It has been found that in the last two years alone, one in two companies (49%) have embraced new technologies and transformed their business faster than ever, and 40% have transformed multiple parts of their business at the same time. High interoperability helps these companies achieve the agility they need to drive compressed transformation. By using applications that easily interact with each other to enable data sharing, greater transparency, and quality human connections, organizations can pivot faster and take advantage of new opportunities.
“While the concept of interoperability is not new, the technology that makes it possible in a fast and cost-effective way is finally bringing it within reach of most businesses,” he said. Emma McGuigan, Senior Managing Director and Head of Business and Industrial Technologies at Accenture. “To compress the transformation from years to months, even days, everything must be integrated and interoperable. One in three companies have prioritized this level of agility and are unraveling the value to outperform competitors in terms of revenue growth, efficiency and resilience, using interoperability to drive total business reinvention .
Enterprises with high interoperability not only benefit from better financial performance, but they are also 12 percentage points better at improving their supply chain and operations; 16 percentage points better to reinvent the customer experience; 12 percentage points more success in improving employee productivity; 4 percentage points more success in adopting sustainable business practices; and 11 percentage points more likely to support compressed transforms.
Leading companies with high interoperability achieve profitable growth by allocating only 2-4% more of their IT and functional budgets to applications, while managing as many or more applications within their IT stack. Most enterprises now have more than 500 applications, and eight in ten (82%) say they will continue to expand their application footprint, making an interoperable approach even more important. At the same time, the 66% say the number of applications and their associated technical complexities are a barrier to achieving interoperability. Those who succeed make high interoperability a central part of their overall business and technology strategy.
The report recommends three actions for companies to improve interoperability:
1. Take advantage of the cloud:
The cloud, a fundamental element of interoperability, is now ubiquitous. Companies that succeed in improving their interoperability start by migrating existing applications to the cloud and investing in new cloud-based business applications. Most importantly, they’re using the cloud to connect data and experiences across all apps, creating a single version of the truth for the enterprise. Accenture’s study found that nearly 72% of enterprises with high/medium interoperability have adopted the public cloud and have already migrated 30% of their data and workloads. Only 60% of companies with little or no interoperability have adopted the public cloud, a delay of 12%.
2. Use composable technology:
Using proven, repeatable solutions that can be configured and reconfigured at high speed to meet changing business needs, known as composable technology, creates flexibility at the core of organizations. This enables enterprises to address the effects of disruption through faster, better, and cheaper transformation, which requires moving from a technology architecture of static, independent parts to one of composable parts. By using pre-built interoperable solutions to swap and plug in smaller application components, new solutions can be created without major disruption.
3. Focus on meaningful collaboration:
Interoperable applications are only part of the equation. Interoperability can enable meaningful collaboration by allowing functions and people to work together seamlessly toward a common goal. They can use real-time data, analytics and AI, along with new ways of working, to unlock the value of technology, empower people and achieve better results. This culture of collaboration comes from the top: more than a quarter (27%) of leaders consider the lack of collaboration between business functions as the main challenge caused by weak/no interoperability. Leadership can amplify collaboration by building broad use cases for new interoperable applications and empowering employees of all functions to solve them as a team.
To read the full article Value Untangled: Accelerating radical growth through interoperability, visit: www.accenture.com/value-untangled
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