Building and Reusing Packaged Business Capabilities (PBC)

One of the main goals of leading IT figures is to try to improve the productivity of the IT department they manage. One way to achieve this goal, and one that is becoming increasingly popular among organizations of all industries and sizes, is to leverage composable and reusable elements. In addition to optimizing productivity and speeding up the development process, this solution also ensures better governance.

These reusable components, known as packaged business capabilities (PBCs), belong to a specific type of packaged application that encapsulates distinct and self-contained business functionalities. By embracing this modular approach, organizations can rapidly assemble and deploy digital capabilities without the burden of time-consuming development from the ground up.

When implemented effectively, PBCs hold immense potential for organizations worldwide. By the end of 2023, around 30% of new applications are projected to be built using PBCs, a remarkable increase compared to the mere 5% recorded in 2020. PBCs’ modular components enable organizations to streamline development processes, reducing time and costs.

This article discusses PBCs and their remarkable capacity to revolutionize building and deploying software. Taking a close look at its characteristics, applications, and value, we discuss how PBCs address the limitations posed by traditional architectures.

What are PBCs?

Packaged business capabilities are standardized, pre-packaged software components representing specific business capabilities and functions.

PBCs are self-contained modules consisting of a data schema and a collection of services, APIs, and event channels. PBCs are functionally complete and usually have all the necessary resources to operate independently without relying on external components. This autonomy is achieved by minimizing critical external dependencies and eliminating the need for direct access to its data.

Are microservices the same as PBCs?

Microservices (or microservices architecture) are a cloud-native architectural approach in which a single application comprises many loosely coupled and smaller deployable independent components or services. Although microservices and PBCs promote composability and reusability in software development, they are not the same.

The key difference in principle between microservices and PBCs is that microservices are an architectural style that defines how we break down applications into services. These services can communicate through APIs; each can be developed, deployed, and scaled independently. However, PBCs are custom combinations of certain microservices that work together to carry out a specific business function.

To better grasp the distinction, consider this example: In the microservice approach, a microservice might be responsible for handling user registration, another for login, and a third one for managing user profiles. However, a PBC might take our entire user authentication flow.

Microservices, although valuable, can be difficult to handle for the average business user, as they are complex and challenging to maintain.

Redefining Limitations: Monolithic Architectures vs. PBCs

For years, monolithic architectures have been the bedrock of organizations. Although they serve their purpose, when these architectures are confronted with the demands of the digital age, they reveal their vulnerabilities and crumble.

Some of the challenges that plague monolithic applications are listed below.

• Rigidity: Unlike PBCs that utilize modular interchangeable components, traditional monolithic architectures are effectively a single unit, making them resistant to change and innovation, especially as size increases.
• Scalability challenges: Scaling individual components within a monolithic application can be challenging. It is inefficient and prone to resource waste, hindering organizations from effectively meeting fluctuating demands.
• Inhibiting innovation: The tightly coupled and intertwined nature of components in monolithic architectures limits experimentation and innovation.

Applications of PBCs

Practical applications of PBCs are found across different industries and business teams. Some of the key applications include the following cases.

Supply chain management (SCM) systems
The SCM system is a company’s software system used to manage the entire flow of goods and services, incorporating all processes in transforming raw materials into finished products. The integration of PBCs in this process helps to optimize this whole flow, as it may include capabilities like demand forecasting, inventory optimization, logistics management, supplier collaboration, etc.

E-commerce and online marketplaces
Online retailers and marketplaces leverage PBCs to handle payment processing, inventory management, order fulfillment, and customer support. PBCs allow them to focus on their core business without investing heavily in developing these functionalities from scratch.

Financial services
Financial industries can harness the power of PBCs for risk management, fraud detection, trading platforms, and more. These capabilities allow organizations to build robust and secure applications without the need to build everything from the ground up.

Approaches to building and reusing PBCs

Organizations can select from various approaches when constructing PBCs tailored to their unique goals and needs. These approaches involve strategies for integrating and leveraging third-party solutions and resources. In this section, we explore these approaches, discuss their considerations, and highlight the benefits they provide.

Standalone implementation approach
The standalone implementation approach involves deploying PBCs as separate, independent systems within an organization’s infrastructure, and some of the benefits of this approach include the following.

• Isolation and flexibility: With PBCs operating separately and independently, the risk of widespread failures is reduced. Isolation can reduce or eliminate the need for external dependencies and thus increase system flexibility.
• Customization: Organizations can tailor each PBCs to their requirements to care for specific needs.
• Scalability: Organizations can scale these components independently to optimize performance and resource allocation.

Legacy modernization approach
Legacy modernization involves replacing outdated systems and traditional workflows with modern technologies. This approach can leverage existing PBCs to replace and upgrade functionality within a more extensive legacy system.

System enhancement approach
Organizations use this approach to enhance existing systems by incorporating PBCs. This approach promotes reusability and efficiency in the following ways.

• Maximizing investments: With PBCs, organizations can extend the value of their existing systems to fulfill new requirements, minimizing the need for extensive redevelopment.
• Reducing redundancy: PBCs streamline development efforts by utilizing pre-built functionalities. This reduces redundancy and ensures consistency.
• Accelerating time-to-market: By leveraging existing PBC solutions, organizations can accelerate development cycles, allowing them to create new features and capabilities to market quickly.

The value of PBCs

Using a unifying API, PBCs stitch various services together to streamline workflows; this gives organizations one central interface to work with.

Unlike microservices, PBCs allow businesses to deal with fewer building blocks, thereby streamlining operations. They enable companies to swiftly adopt digital platforms, paving the way for efficient processes and seamless customer experiences.

The versatility of PBCs grants businesses the ability to pivot and adapt rapidly to changing circumstances. With PBCs, organizations can easily customize and expand their offerings, exploring new avenues for innovation and growth.

Composability and PBCs

Composable thinking revolves around building systems and solutions using modular and interchangeable components. This philosophy aligns perfectly with the teachings of PBCs.

Fueled by PBCs, composable business architectures capitalize on pre-built capabilities that organizations can quickly assemble to form solutions that cater to specific business needs. This approach minimizes development time, reduces complexity, and enhances adaptability, enabling businesses to embrace technological advancements with agility.

Advantages of composable architecture
The Composable Architecture proposes a set of principles, patterns, and associated technologies that support composable enterprise where businesses adopt in-house and third-party components that are pluggable, replaceable, scalable, and independently deployed and improved.

An API-first approach within a composable architecture allows individual components of a system to interact and communicate effectively using well-defined user interfaces. The composable business architecture leverages the power of APIs, giving businesses the ability to seamlessly integrate, modify, or replace components without disrupting the entire ecosystem. This combination of modularity and interoperability fosters a responsive, scalable, and efficient business environment perfectly aligned with the dynamic demands of today’s market.

Essentially, composable thinking with PBCs creates a synergy that gifts businesses with digital transformation and propels them into a future of boundless innovation and change.

PBCs and innovation

PBCs allow businesses to offload more noncore functionalities to specialized vendors or partners, freeing up resources and energy organizations can use to enhance their core competencies, differentiating factors, and creating new products and services. PBCs also provide a sandbox for experimentation. Organizations can easily integrate PBCs to test new ideas and features, moving forward with ideas they deem fit and discarding the rest without taking apart the entire system.

PBCs in response to changing business demands
Volatility, uncertainty, complexity, and ambiguity (VUCA), a term coined in 1987, has been used repeatedly to characterize the modern business landscape. Organizations need the flexibility and adaptability that PBCs offer to navigate these challenges.

PBCs are designed to be modular and scalable; organizations can scale up or down specific capabilities as the market demands without significant development cycles, reducing both time and cost. Organizations can leverage PBC’s modular superpower to minimize the risk of widespread failures, thereby gifting systems resilience.

The added value of application composition and the role of PBCs in driving innovation
Application composition is the process of assembling applications from individual PBCs, also known as Composable Applications. It is pivotal in driving innovation as organizations can compose unique applications tailored to specific customer needs by combining various PBCs.

PBCs facilitate rapid prototyping and experimentation, which allows organizations to quickly assemble and test new ideas, features, and business models, enabling them to validate concepts and innovate more efficiently.

Conclusion

Modern organizations are contending with business changes in a world characterized by dynamic market shifts and ever-evolving customer expectations. In the business domain, this series of innovations is driven by the evolution from monolithic architectures to composable architectures or composable enterprises in general.

At the heart of composable applications are PBCs. As discussed, PBCs are more than composable components — they’re building blocks for reimagined ecosystems. PBCs’ modular architecture empowers enterprises to redefine agility and accelerate innovation, propelling organizations to fast-track their time to market and seamlessly adapt to the evolving business landscape.

From standalone implementations that embrace flexibility to legacy modernization that breathes new life into aging systems, the versatility of PBC approaches is a testament to their transformative potential. By embracing PBCs, organizations maximize the value of their investments and foster an environment of operational efficiency.

Download the free white paper “Composable Enterprise. Why composability is the future” to better understand PBC’s role in a composable future.