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Everest Group recently helped a low code no code (LCNC) product company evolve its product and pricing strategy by assessing the market standing of its platform features and commercials. Read on to learn about the approach, assessment dimensions, and outcomes in this case study.
As part of the engagement, we provided the following services to the client:
Everest Group analyzed the platform from two broad perspectives: application development capabilities (declarative tooling to accelerate application development and delivery) and process orchestration capabilities (ability to design, execute, and monitor business processes). In this blog, we’ll focus on the application development capabilities.
Everest Group gathered insights about the platform capabilities from the provider using a comprehensive RFI that collected more than 190 data points across 17 categories, followed by a briefing and demo showcasing the platform’s capabilities. Inputs from these sources were used in conjunction with our existing low-code research and ongoing conversations with ecosystem players to inform the final review across the below assessment dimensions.
Based on our research of low-code platforms published earlier this year, we identified the following five key areas where LCNC platforms can drive competitive differentiation through strategic investments:
Source: Everest Group
Now let’s take a closer look at each of the assessment dimensions and the features/components evaluated in each of these areas.
One of the foundational elements of an enterprise-ready low-code platform, this dimension takes into account the availability of out-of-the-box templates for common user interface components, widgets, and functional libraries, as well as reusability of user-built templates, availability of industry-specific out-of-the-box solutions, and a robust marketplace supported by multiple partners.
Before incorporating any new technology tool into its ecosystem, enterprise IT teams prioritize its ease of integration with the existing tech stack during the evaluation process. This dimension assesses the availability of pre-built connectors to common tools in the enterprise technology stack, the low code option to include further integrations, and the ability for developers to use custom scripting to call external application programming interfaces (APIs) where required.
As low-code platforms scale in importance from building departmental workflow applications to business-critical enterprise-grade applications, the extent of AI-powered abilities offered is proving to be a key win theme. Through in-house capabilities or integration with external AI providers, low-code platforms aspire to provide AI-powered development assistance, AI-based application management services, AI-based automated testing, AI-powered code quality alerts, and AI-augmented portfolio analysis.
Business users play an increasingly important role in the application lifecycle, collaborating with professional developers to reduce the gap between their requirements and the final product’s functionalities. Therefore, a platform should offer capabilities that facilitate effective collaboration, such as role-based access, project management capabilities, document sharing capabilities, and notifications on app updates, among others.
This dimension considers the support provided to UI components like lists and tables, the ability to support different devices and operating systems, language options, integrations with design tools, reusable screen templates, customizable themes, and navigation ease. UI/UX capabilities are a key swaying factor in enterprise low code buying decisions, especially when building customer-facing applications.
The subscription-based pricing model experienced higher adoption than perpetual licensing in 2021 because it results in lower upfront investments and greater flexibility to scale deployments. Of the eight different pricing models uncovered in our research, the user-based licensing model was the most widely adopted. On-premise deployment of low-code and no-code platforms was found to be 25-50% more costly than cloud-based deployment.
Source: Everest Group
Gap identification – Everest Group helped the client identify key market differentiators, strengths, and limitations across dimensions, as well as the key features for each of these elements
Fine-tuning product vision and roadmap – The insights helped the client prioritize its feature pipeline and advance its messaging to have a greater impact
Product and pricing strategy – The trend analysis helped the client understand the pricing strategies adopted by their competitors and how these vary based on factors like hosting environment and buyer geography
For more information about this LCNC project or to discuss our research on low-code and no-code platforms, please reach out to Manukrishnan SR, Alisha Mittal, or Yugal Joshi.
Also, learn about the top five demand themes – data and AI, cloud, experience, platforms, and security – driving growth for IT service providers in our webinar, IT Service Provider 2023 Forecast: The Top 5 Themes for Growth and Wallet Share.
Catch Everest Group Vice President, Alisha Mittal, in this webinar as she joins a panel to discuss creating dynamic Enterprise IT plans for success in the new age of disruption. They will discuss:
Thursday, November 10, 2022, at 8:00 am CST, 9:00 am EST, 1:00 pm GMT, 7:30 pm IST
Live, virtual event
Alisha Mittal
Vice President, Everest Group
Clifton Menezes
Global ADMnext Offer Lead, Capgemini
Join Everest Group’s Alisha Mittal on this webinar in which the panel will discuss how leading organizations are driving resiliency, responsiveness, reliability, and receptivity with digital at scale and speed, and deep cultural shifts.
Tuesday, September 27, 2022, at 9:00 am CST, 10:00 am EST, 2:00 pm GMT, 7:30 pm IST
Live, virtual event
Vice President, Everest Group
Clifton Menezes
Global ADMnext Offer Lead, Capgemini
During the digital transformation journey, a Global 2000 enterprise uses more than 150 software solutions and tools on average to support its product or services delivery. Despite the huge investment, the value realized from this technology is still unclear to most enterprises. Read on to understand the importance of measuring the value delivered by software applications or products with value stream management (VSM) and our 4D framework to implement it.
More than 90% of enterprises have adopted agile development methods in some shape or form, and DevOps adoption is on the rise. But surprisingly, less than 20% consider themselves highly mature agile enterprises. These few have adopted a Scaled Agile Framework (SAFe) to implement agile and DevOps practices across the enterprise with some having DevSecOps and BizDevOps processes for product development. Even then, enterprises are unable to track and measure the organizational-wide technology value. Most of the remaining 80% have agile and DevOps adoption in pockets, making it tougher to align outcomes and realize meaningful benefits.
With the increasing investment overload and absence of tangible outcomes, the critical importance of delivering and realizing value is gaining enterprise attention. Concerted efforts for defining, measuring, and enabling value are needed.
Agile and DevOps adoption is considered by many as the ultimate step toward digital transformation. However, enterprises must realize it is just a starting stage for continuously tracking, measuring, realigning, and improving digital solutions’ outcomes and value. This is where the concept of value stream management (VSM) becomes pertinent.
Before we delve deeper into what VSM is, let’s understand what VSM is NOT.
People often use value stream management and Value Stream Mapping interchangeability, which is thoroughly misleading. The two are related but not the same.
Exhibit 1: Differences between value stream management and value stream mapping
As the graphic above illustrates, Value Stream Mapping is an activity or a subset of VSM. The value streams and processes are defined during Value Stream Mapping and act as an initial step for effective outcomes from value stream management. VSM focuses on a data-centric approach to decision making and promotes a culture of innovation and improvement through a continuous feedback loop and collaboration.
Now that we are clear on what VSM is not, let’s delve deeper into what VSM is, why enterprises need it, and how to adopt it.
In an enterprise setup, there are broadly two sets of value streams – operational and development.
Operational value streams or business value streams comprise the processes and people who deliver the value to the end user by leveraging systems or solutions created by the development value streams. Operational value streams are defined by the nature of the business and its business unit. Some examples of operational value streams are product manufacturing, software product sales and support, order fulfillment, and support functions.
Development value streams or IT value streams consist of the systems and software developers, product managers, and other IT practitioners who design, build, deploy, and maintain systems/solutions. These systems/solutions are used by either internal customers (members of the operational value stream) or external customers who are direct buyers and users. The definition of processes or steps in the development value stream is standardized and runs in parallel with the phases of the Software Development Lifecycle (SDLC) – plan, build, release, and operate.
For example, order fulfillment in a software product company is one operational value stream involving different teams and processes – from sales enablement, licensing, and provisioning to customer support and renewals. These teams require software systems like a Customer Relationship Management (CRM) portal, service management platform, license management systems, etc., to support their processes. The development value streams will be aligned to build and support each of these software systems, enabling the operational teams to deliver the product effectively.
The SAFe principles apply to the development value streams. However, enterprises currently focus SAFe implementation efforts on delivering good products or solutions with agility versus delivering customer value. To deliver value along with agility, adopting VSM in the development value streams should be the next step. This will act as a management layer enabling more data-driven decision making at the SDLC level. VSM also can be extended to operational value streams.
Today the focus for VSM has expanded to the enterprise level bringing the delivery and operational value streams closer.
Aligning development value streams to the objectives of operational value streams is key to delivering optimum value to the end customer. VSM platforms connect people, processes, and technology across the SDLC and can be extended to integrate heterogeneous value streams across the enterprise.
Some of the key benefits enterprises stand to achieve with a successful VSM approach are:
While we understand the need for VSM in enterprises, implementing it in a structured manner to gain maximum value delivery is equally important.
Implementing VSM effectively using the 4D framework
Below is a recommended starting approach:
Determine the current state of value flow and define value streams at an enterprise level, starting with identifying the operational value streams and the respective development value streams. Align the operational and development value streams to the final value to be delivered by the value stream. Identify current system behaviors and interdependencies.
Design value stream maps to achieve the future state of value flow right from ideation to the value delivery stage. Organize teams to value streams by bringing together the right stakeholders accountable for each value stream step for a mapping exercise to decide steps, handoffs, and metrics.
Deploy VSM tools to connect all value stream parts to measure the flow of value in real time using metrics that track the time, velocity, load, and workflow efficiency. Expand to integrate with other value streams as necessary. Providers like Digital.ai, ConnectALL, Micro Focus, Plutora, and Tasktop offer VSM tools to consider.
Demonstrate continuous improvement in value delivery by using real-time insights from flow metrics as feedback to realign the strategy to increase throughput, efficiency, and value stream productively. Continuously measuring flow metrics gives all stakeholders end-to-end visibility to make informed decisions on investments and prioritization.
This 4D framework is a starting point to implement VSM. Additional factors like talent, governance, organizational culture, etc., can further optimize the value delivery through VSM. Adopting a performance-oriented, highly cooperative, and risk-sharing-based environment will enable smooth VSM implementation.
With growing enterprise investments in agile and DevOps adoption for software development, it will be interesting to see how adding a VSM layer will change the value measurement and value delivery game in upcoming years. Stay tuned for our upcoming blog further exploring the enterprise VSM adoption roadmap.
To discuss value stream management, contact [email protected] and [email protected].
Read more of our blogs for more fact-based insights and transformative business process.
Low code is emerging as a key technology for enterprises to rapidly develop and deploy custom applications and accelerate their digital transformation journey. Multiple low code platform providers have surfaced in the past few years, offering immense potential. However, the technology remains underutilized because of enterprises’ lack of awareness, multiple myths and misconceptions, and the limited availability of talent.
In this webinar, we’ll share our views on the low-code market, its potential, and key opportunities for enterprises to drive digital transformation. We’ll also explore the low-code adoption journey leading enterprises to maximum benefits.
What questions will the webinar answer?
Who should attend?
Selecting the Right Low-code Platform: An Enterprise Guide to Investment Decision Making | Blog
Enterprise adoption of low-code platforms has been invigorated in recent years by its potential to drive digital transformation. This fast-rising platform solution offers promise to democratize programming with today’s talent shortage and help companies develop applications and enhance functionalities faster. While the opportunities are clear, charting a path to successful adoption is ambiguous. Learn the 4Cs approach used by best-in-class enterprises for selecting and adopting the right-fit low-code platforms in this blog.
As many as 60% of new application development engagements consider low-code platforms, according to Everest Group’s recent market study. Driven by the pandemic, the sudden surge in demand for digital transformation accelerated low-code annual market growth to about 25%. Considering its potential, low code is appropriately being called the “Next Cloud.”
Interest by investors also has accelerated, further driving R&D spend for new product development. Funding activities in 2022 to companies featuring low code in their profiles already amounts to $560 million across 40 rounds.
Platform providers are responding to these elevated expectations with equal fervor by building platforms with deep domain-specific expertise, while others are providing process-specific solutions for enterprises’ customization requirements.
While these markets have resulted in a proliferation of low-code platforms to choose from, it also has led to confusion and inefficiencies for enterprises. As more and more enterprises explore the potential of these platforms, IT leaders are faced with numerous questions and concerns such as:
“How do I select the platform that can address my current and future requirements?”
“Which platform will work best in my specific enterprise IT landscape?”
“How can we optimize the investment in this technology?”
“How do I compare the pricing structures of different low-code platforms?”
“How do we ensure governance and security of the IT estate with these new tech assets?”
In addition to the high-priority use cases that initiate the adoption, enterprises should consider the platform’s scalability potential, talent availability for support and enhancement, and integration with the broader IT landscape to make the right selection.
Additionally, low-code platforms are intended to address the requirements of the IT function as well as business stakeholders. Considering the drivers, expectations, and requirements of both when making the selection is essential. A collaborative decision-making set-up with the central IT team and key Line-of-Business (LoB) leaders is critical for a successful platform selection. Let’s explore the 4Cs to low code success.
The key steps to ensure successful low-code platform selection and adoption are:
This approach can provide a roadmap for enterprises with distinct outcomes. We have witnessed enterprises either adopting the best-fit approach resulting in a platform portfolio or leveraging a single platform as a foundation for an enterprise-grade innovation engine.
For instance, the Chief Technology Officer (CTO) of a leading bank in the US invested in establishing a low code Center of Excellence (CoE) that uses different platforms for process automation, IT Service Management (ITSM), and enabling point solutions for business users.
On the other hand, a large US commercial insurer built its entire end-to-end multi-country app on a single low-code platform. This comprehensive, business-critical application managing claims, billing, and collection is accessible by all underwriters and service personnel.
Next, we explore how to best compare platforms based on their offerings and capabilities. The tables below illustrate the top five business and technology-oriented parameters to consider when evaluating platforms, along with their relevance and enterprise expectations.
Factors associated with the platform’s technical robustness are of key importance to IT decision-makers. Integration and UI/UX capabilities are at the top of enterprise’s technology priorities when comparing multiple platforms.
For instance, Appian ships with 150-plus Out-of-the-Box (OOTB) connectors. Appian SAIL, a patented UI architecture, takes declarative UI definitions to generate dynamic, interactive, and multi-platform user experiences. It also makes the applications more secure, easy to change, future-proofed, and native on the latest devices.
Assessing these parameters is important to understand whether low code can be sustained and scaled long-term and if it addresses the business users’ expectations. Pricing and security constructs are at the top of the list for businesses looking to adopt a low-code platform.
Let’s consider Salesforce as a case-in-point. Salesforce has security built into every layer of the platform. The infrastructure layer comes with replication, backup, and disaster recovery planning. Network services have encryption in transit and advanced threat detection. The application services layer implements identity, authentication, and user permissions. In addition, frequent product updates that help it to align its product offering with changing market demands put Salesforce as one of the go-to platforms for all the CRM needs of enterprises.
The plethora of options makes it difficult for enterprises to zero down their investments on a particular low-code platform. Enterprises must also leverage their network of service partners for guidance in this decision-making process.
Talent availability for implementation and enhancement support is critical to keep in mind during the platform selection. For the same reason, multiple system integrators are now taking the route of inorganic growth to bolster their low-code capabilities.
This is the time to hop on the low-code bandwagon and establish low code as the basis for enterprise digital transformation.
Everest Group’s Low-Code Application Development Platforms PEAK Matrix® Assessment 2022 provides an overview of the top 14 platforms based on vision, strategy, and market impact.
To share your thoughts and discuss our research related to low-code platforms, please reach out to [email protected] and [email protected].
Despite their growth, low-code platforms are still surrounded by much confusion. Many enterprises incorrectly believe that real developers don’t need low code, anyone can do it, and it’s only for simple problems. To debunk three common myths in the low-code market, read on.
With its increasing importance, low-code platforms are also subject to several myths and misunderstandings. As with every evolving technology, enterprises have many questions about optimally using these platforms.
Based on our conversations with multiple enterprises confirming the lack of understanding about the low-code market, we tackle the common misperceptions below:
The term low code generally evokes the impression of an HR manager who, tired of following up with the IT team multiple times, decides to create a leave approval workflow application. While this impression is not incorrect, professional developers and enterprise IT teams are key stakeholders in the low-code ecosystem as well.
Professional developers increasingly use low-code platforms to improve their efficiency. Some of these platforms can provide code quality alerts and Artificial Intelligence (AI)-powered recommendations, not to mention custom solutions that require minimal tuning.
The built-in DevOps capabilities in these platforms also encourage a culture shift from the commonly used waterfall model among users. For example, supply chain management software provider Nimbi significantly reduced developers in their team from 40 to 24 when they switched to OutSystems from traditional platforms.
We strongly believe central IT teams have a meaningful role in the ecosystem to provide effective oversight and governance, in addition to strategizing the use of the best low-code platforms at the enterprise level. In the absence of centralized governance, low-code platforms may proliferate across the organization leading to aggravation of the shadow IT issues and higher spend.
As much as we may want to believe, low-code platforms are not a panacea to the ongoing talent crisis. Misleading promises by certain technology vendors have created a common impression that any user can develop any application using low-code platforms. However, low-code development does not imply zero technical skill requirement.
Most low-code platforms enable the extension of their capabilities through traditional programming languages like Java and C#. Off-the-shelf solutions have their limitations, and most applications need custom logic at some point. Typical job descriptions for low-code developer profiles outline technical qualifications like JavaScript, HTML5, and CSS3, alongside Continuous Integration (CI) and Continuous Delivery (CD) pipeline tools like Jenkins.
Thus, it is unrealistic to expect an army of business users to step in and take over all application development-related needs from the IT organization. Low-code development remains a role with a highly demanding skillset across various technologies.
Many enterprise leaders and service providers believe that low-code platforms are only suitable for small-scale department-level needs. However, our conversations indicate that low-code platforms are being rapidly adopted for critical applications used by millions of users. Here are some examples of how low code is solving complex IT problems around the world:
As we witness the adoption of low-code platforms garnering pace, a lot of myths and misunderstandings need to be cleared up about low code versus traditional development. Technology providers and service partners play a key role in helping their clients navigate the abundant options to orchestrate a carefully crafted low-code strategy and select the best low-code platforms.
At Everest Group, we are closely tracking the low-code market. For more insights, see our compendium report on various platform providers, the state of the low-code market report shedding light on the enterprise adoption journey, and a PEAK Matrix assessment comparing 14 leading players in the low-code market.
To share your thoughts and discuss our low-code market research, please reach out to [email protected], [email protected] or [email protected].
You can also attend our webinar, Building Successful Digital Product Engineering Businesses, to explore how enterprises are investing in next-generation technologies and talent and the most relevant skillsets for digital product engineering initiatives.
Low-code platforms are here to stay because of the rapid application development and speed to market it enables. But why is no one taking the same “life cycle” view for low-code applications and workflows as typical software development? A new model of Low-code Development Life Cycle (LCLC or LC2) is needed for enterprises to realize the potential benefits and manage risks. Read on to deep dive into these issues in this latest blog continuing our coverage of low-code.
Our market interactions suggest enterprises adopting low-code platforms to build simpler workflows or enterprise-grade applications are not thinking about life cycle principles. Though enterprises for ages have adopted Software Development Life Cycle (SDLC) to build applications, it is surprising no such initiatives exist for low-code applications.
As we previously discussed, low-code platforms, requiring little or no programming to build, are surging in adoption. We covered the key applications and workflows enterprises are focusing on in an earlier blog, The Future of Digital Transformation May Hinge on a Simpler Development Approach: Low Code.
Given its staying power in the market, it’s time to consider Low-code Development Life Cycle (LCLC or LC2).
Here are some recommendations on how LCLC can be structured and managed:
Rethink low-code engineering principles: Enterprises that have long relied on SDLC concepts will need to build newer engineering and operations principles for low-code applications. Enterprises generally take long-term bets on their architecture preferences, Agile methodologies, developer collaboration platform, DevOps pipeline, release management, and quality engineering.
Introducing a low-code platform changes most of this, and some of the typical SDLC may not be needed. For example, these platforms do not generally provide an Integrated Development Environment (IDE) and rely on “designing” rather than “building” applications. In SDLC, different developers can build their own code using their IDE, programming language, databases, and infrastructure of choice. They can check in their code, run smoke tests, integrate, and push to their Continuous Integration/Continuous Delivery pipeline.
However, for most low-code platforms, the entire process has to run on a single platform, making it nearly impossible to collaborate across two low-code platforms. Moreover, enterprises might be exposed to performance, compliance, and risk issues if these applications and workflows are built by citizen developers who are unaware of enterprise standards of coding. This also might increase the costs for quality assurance beyond budgeted amounts.
Even professional developers, who are well aware of enterprise standards while building code in an existing manner, may not know how to manage their LCLC. Many low-code platforms allow SDLC steps within their platform, such as requirement management. Therefore, all the collaboration will have to happen on the low-code platform. This creates a challenging situation requiring enterprises to have different collaboration platforms for low-code applications separate from the other standard tooling they have invested in (such as Teams, Slack, and other agile planning tools) – unless they are integrated through APIs, adding overhead and cost.
Also complicating issues is the desire by some developers to have the developer portal of these low-code platforms extend to their IDE. Most platforms prefer their own CI/CD pipelines, although they can also integrate with third-party tools enterprises have invested in. A different mindset is needed to manage this increased technological complexity. Because low-code applications are difficult to scale for large data sets, some of the scaling imperatives enterprises have built for years will need to be rethought.
Manage lock-in: Most low-code platform vendors have a specific scripting language that generates the application and the workflow. Developers who are trained on Java, .net, Python, and similar languages do not plan to reskill to learn proprietary languages for so many different platforms. While enterprises are accustomed to multiple programming languages in their environment, they normally have selected some primary languages. Though low-code platforms do not extensively rely on developers coding applications, enterprises generally would want to know “under the hood” aspects around architecture, data models, integration layer, and other system elements.
Build governance: We previously covered how low-code platform proliferation will choke organizations that are blindly prioritizing the speed of software delivery. Therefore, governance is needed not only in the development life cycle but also to manage the proliferation of platforms within enterprises. Enterprises will need to closely watch the low-code spend from subscription and software perspectives. As low-code platforms support native API-based access to external platforms, enterprises will need to govern that spend, risk, and compliance (for example, looking at such issues as whether some third-party platforms are on the blacklist).
Low-code platforms can provide enterprises with a potent platform. But, if not managed well, it can be risky. To manage the potential risks, enterprises need to be aware of these three considerations:
Enterprises’ desires to drive digital transformation will make low-code proliferation a reality. Currently, most low-code vendors derive a small $100-500K revenue per client, indicating the focus is mostly on Small and Medium Business (SMB) segments or small line of business buying. As a result, we expect consolidation in this market with large vendors such as Salesforce, ServiceNow, and Microsoft furthering eating into small vendor’s share. Enterprises should keep a close watch on this M&A activity as it can completely change their low-code strategy, processes, and the business value they derive out of strategic investment into a low-code platform.
What has your low-code journey been like, and how are you using life cycle concepts? Please reach out to share your story with me at [email protected].
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