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The New Approach to TCO for Digital Commerce

TCO is a crucial measure for organizations looking to make informed decisions about their investments. By accounting for all the costs associated with a product or service, TCO aims to provide a comprehensive view of the financial impact of a decision. In today's cost-scrutinized business environment, including TCO in your decision criteria is more important than ever.<h2></h2>With a traditional monolithic tech stack, pricing is relatively easy to define in the beginning because you know what you are getting out of the box. However, this typically requires multi-million dollar contracts, long decision processes and inability to change and flex to your business requirements as the market changes over time.<h2></h2>MACH allows you to build a best-of-need tech stack leveraging best-of-breed vendors ensuring no more vendor lock-in or inability to capitalize on new ideas. According to the MACH Alliance global 2023 Enterprise MACHified survey of 500 large business tech leaders, 85 percent of organizations that have increased the percentage of their infrastructure which is MACH in the past 12 months cite increased ability to respond to changes in the market faster, to build and implement new functionality quicker, and reduced costs. They’re also most likely to say their infrastructure is keeping up with customer demands and that they’re ahead of the competition.<h2></h2>Modern, composable digital commerce solutions, powered by MACH-architectures have emerged to replace and resolve the numerous headaches caused by technologies derived during the 1990s. However, making the decision to migrate to a modern architecture can seem daunting. But with a clear understanding of its proven benefits and comparative costs, the decision becomes very compelling and justified.<h2></h2>One of the key decisions organizations face is choosing between monolithic and composable solutions and the related migration path. TCO (total cost of ownership) is often used as the key metric to compare the cost of these two solutions. However, the ongoing costs associated with adapting to a changing environment are not adequately covered by the traditional way of calculating the TCO.<h2></h2>Published in partnership with Commercetools and Google Cloud, this eBook has been created to address the limitations of traditional TCO calculations in capturing the true costs and value of technology investments in a world of constant change. We believe a better methodology for calculating TCO includes evaluation of additional metrics like Total Cost of Change (TCC) and Total Spend Productivity (TSP).<h2></h2>The purpose of this eBook is to help business leaders to objectively analyze and compare all the costs of both architectures while introducing a better methodology for calculating a more accurate TCO.<h2></h2><a href="https://drive.google.com/file/d/1Min2C9QCALPf-OGvDLUqcUBTgJWXENZN/view" target="_blank">Download your copy today.</a>

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TCO is a crucial measure for organizations looking to make informed decisions about their investments. By accounting for all the costs associated with a product or service, TCO aims to provide a comprehensive view of the financial impact of a decision. In today's cost-scrutinized business environment, including TCO in your decision criteria is more important than ever.


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MACH Global Research 2023  Blog Series Pt. 3: Adapting To An Evolving Landscape

In March, we <a href="https://machalliance.org/newsroom/mach-global-research-2023" target="_blank">released the results</a> of our third annual global IT decision maker research, which surveyed 500 tech leaders from Australia, France, Germany, UK and the US. We sought to understand how MACH investment has accelerated over the past 12 months and what impact that is having on organizations’ ability to thrive in a difficult economy. We’re publishing a four part blog series to dive further into each of the four key research areas within the report, which are: <ul><li>Challenges to upgrading infrastructure </li><li>Influences on transformation </li><li>MACH utilization </li><li>Evidence of MACH benefits </li></ul>Parts <a href="https://machalliance.org/insights/mach-global-research-2023-blog-series-pt-1-so-many-upgrades-so-little-time" target="_blank">one</a> and <a href="https://machalliance.org/insights/mach-global-research-2023-blog-series-pt-2-the-growing-urgency-for-tech-innovation" target="_blank">two</a> of the series have been published. Today, we’re looking at the next section: MACH utilization, including examining the growing adoption of MACH and what’s driving it. <h2></h2>Momentum at MACH speed <h2></h2>MACH is on the rise. Eighty-five percent of research respondents said they’ve increased the percentage of MACH in their infrastructure over the past 12 months. We also learned that organizations plan to increase MACH further within the (very) near term. More than 80% said they have plans to do so within the next six months. So we sought to know what’s driving both that growth in adoption and the urgency decision makers are feeling to embrace MACH. We weren’t especially surprised to find that the top answer was responding to changes in the market faster, followed by the need to build and implement new functionality quicker. We’ve known since our inception in 2020 that MACH enables businesses to pivot quickly. We really saw that come to life during the pandemic when businesses built with best-of-breed solutions were able to quickly deploy new features like click-and-collect when stores shut-down, for example, or they were able to launch a contactless check-out feature where there wasn’t one previously. For many, this made the difference between the companies that survived the pandemic and those that struggled or even shuttered. While the COVID era was a dark period of time, it was an opportunity for MACH to take center stage, and it really shined. In a similar vein, four in five research respondents acknowledged that they view MACH as a way to respond to economic volatility, noting the rocky economy has been a contributing factor to their organization's attitudes toward MACH. That has also led to a decreased resistance to change among IT teams. Year-over-year compared to our 2022 research, resistance to change has fallen from 39% to 30%. We don’t take a 10% drop lightly and believe this helps affirm that MACH Alliance’s efforts to showcase the clear and measurable benefits – and the long-term value – of MACH are working. The shift toward MACH has become impossible to ignore. <h2></h2>Adapting to an evolving landscape<h2></h2>As new digital touchpoints continue to emerge, it’s become clear that legacy platforms simply weren’t built to accommodate constant change. Improving the customer experience by being able to respond to change quickly is the only way businesses will meet buyers where they are today. Case in point: Fifty-five percent of respondents said improving customer experience is a main driver behind their transition to MACH infrastructure. Composable commerce opens the door to creating truly omnichannel CX whereby differentiated, personalized experiences can be delivered. So many leaders from within the Alliance network have shared compelling anecdotes or best practices for making a business digital-first and customer-led. For example: Costa Coffee’s Digital Technology Director <a href="https://machalliance.org/insights/meet-your-mach-alliance-ambassador-gordon-lucas-global-digital-technology-director-costa-coffee" target="_blank">Gordon Lucas</a> described how the company poured its focus into revamping its app and loyalty programs with MACH elements. Doing so has paid dividends. Costa has one of the largest non-grocery loyalty programs in the UK with millions of members. And member Frontastic <a href="https://machalliance.org/insights/how-mach-technologies-allow-you-to-adapt-your-digital-experiences-easily" target="_blank">dove into</a> how MACH technologies allow for easy adaptation of digital experiences, touching on how commerce teams can create outstanding digital experiences fast thanks to the power of headless. This is the way forward. Adapt and thrive, or be complacent and fail. That’s the option businesses have today, and we saw in our research that more and more organizations refuse to stand idly by while the competition evolves. Stay tuned for the fourth part of this four-part series, which will focus on evidence of MACH benefits.

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In March, we released the results of our third annual global IT decision maker research, which surveyed 500 tech leaders from Australia, France, Germany, UK and the US. We sought to understand how MACH investment has accelerated over the past 12 months and what impact that is having on organizations’ ability to thrive in a difficult economy. We’re publishing a four part blog series to dive further into each of the four key research areas within the report.

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What is an Experience Data Platform and how can it fast-forward your composable/MACH journey?

The MACH/Composable movement has gained great momentum in the last years and during 2023 Gartner predicts that 60% of companies will seek composability in their tech investments to gain speed and agility.With a composable approach to the technology stack, companies can quickly adopt changes and meet the evolving needs of customers. A composable approach involves breaking down the technology stack into modular, reusable components that can be easily assembled and reassembled to meet changing business needs. Using this approach, companies can easily add or remove components as needed, without disrupting the entire system.But what’s the best way to transition to composable while ensuring your customer-facing applications don’t get disturbed in the process?While a composable approach offers many necessary benefits, it can also present some challenges related to data fragmentation. When adopting a composable approach, organizations need to carefully consider how they structure their data and ensure it is available in a consistent format across all APIs. Enterprise data from systems such as PIM, DAM, ERP, etc. is often locked in silos where it has its structure and format which makes it difficult to expose the data in a standardized way that is easily consumable by developers. Moreover, different systems may have their own unique way of exposing data, which can make it challenging to achieve interoperability and consistency across APIs. When we ensure data is available in a consistent format and easily accessible, organizations can unlock the full potential of a composable architecture while delivering superior customer experiences.What role does an Experience Data Platform play in the Composable stack?An Experience Data Platform acts as an agile unifying layer sitting on top of all data sources, unifying data assets without the need for costly and time-consuming integration projects when launching new digital initiatives. It has the purpose of funneling this unified data and content into a front-end experience in real-time. It can also collect new data from digital destinations and make it readily available to the rest of your tech stack (insights).Occtoo’s <a href="https://www.occtoo.com/experience-data-platform" target="_blank">Experience Data Platform (XDP)</a> provides several benefits, allowing you to easily replace parts of your tech stack without disrupting customer-facing applications. By starting your composable architecture journey with an XDP, you can quickly reap the benefits of composable architecture in the customer-facing layer, where it adds the most value, while setting yourself up for less risk as you continue to swap the rest of the components in your stack.“With Occtoo’s Experience Data Platform, we are able to easily access data from many different systems and distribute headless experiences into a variety of applications. Not only are we now 4x faster to market but our costs to build these experiences has lowered dramatically.” - Thomas Davis, Global Digital Operations Director – Cartier SA<h2></h2><hr/>Here are five key reasons why an Experience Data Platform (XDP) is a critical investment in the composable stack:<h2></h2><hr/>Easily unify data and content from separate systems: It allows you to quickly unify data and content from separate systems, to make better use of the data you already have, in turn, better preparing you for a transition to a composable architecture while still using your existing data.Leapfrog into a state where you can innovate your customer-facing experiences: When you start your composable architecture journey with an XDP, you have the ability to quickly modernize your customer-facing experiences, giving you a competitive edge and improving your ability to innovate where it matters, in-front of your employees and customers.Lower integration complexity, lower costs: An XDP reduces integration complexity and costs, making it easier and more cost-effective to integrate new systems into your tech stack. By having an XDP in place before swapping out other systems, you can significantly lower the total cost of ownership (TCO) of your tech stack.Swap each individual backend system without disrupting your customer-facing experiences: An XDP enables you to swap each individual backend system without disrupting your customer-facing experiences, minimizing the risk of disrupting your revenue streams.Risk reduction while adapting to your pace of business changes: You can reduce the risk associated with transitioning to a composable architecture, with an XDP. With the XDP serving as a central hub for all data and content, you can transform the rest of your tech stack at a pace that's suitable for your business, without disrupting your existing systems and customer-facing experiences.All in all, if you are an organization that’s looking at going composable, considering an Experience Data Platform as your first investment may just save you complexity and costs while setting you up for long-term success as you continue to swap the rest of the components in your stack.Occtoo is also the first MACH Alliance member to have joined in the data layer and as an Experience Data Platform.<h1></h1>You can also read:<ul><li><a href="https://www.occtoo.com/how-mqmarqet-improved-their-digital-customer-experience" target="_blank">How retail brand MQ Marqet improved their CX and expanded their market reach with Occtoo</a></li><li><a href="https://www.occtoo.com/blog/access-realtime-data-scale-globally-with-experience-data" target="_blank">Access real-time CX data and scale globally with an Experience Data Platform</a></li></ul><hr/><hr/>Author – Jimmy EkbäckJimmy Ekbäck is co-founder and Chief Technology Officer (CTO) at Occtoo. Jimmy’s combined passion for new technology and frustration over legacy technology holding CX professionals back from launching innovative ideas is what brought the seed of Occtoo to life. Prior to founding Occtoo, Jimmy has founded and acted as CTO at inRiver, a globally recognized Product Information Management System.

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The MACH/Composable movement has gained great momentum in the last years and during 2023 Gartner predicts that 60% of companies will seek composability in their tech investments to gain speed and agility. With a composable approach to the technology stack, companies can quickly adopt changes and meet the evolving needs of customers. A composable approach involves breaking down the technology stack into modular, reusable components that can be easily assembled and reassembled to meet changing business needs. Using this approach, companies can easily add or remove components as needed, without disrupting the entire system.


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MACH Certification Serves as a Vendor Benchmark for the Market Shift to Composable

We have been vocal for some time that the market shift to MACH technology represents a major challenge to the position of long-established enterprise suites. Even the biggest tech companies are going composable with a focus on APIs and desire to be MACH. We fully encourage it.

Yet as a result of this maturing market, we have to take our role as gatekeepers (or ‘<a href="https://www.forrester.com/blogs/buy-an-integrated-platform-not-a-box-of-rocks/" target="_blank">bouncers</a>’, as we’ve been called by Forrester’s Joe Cicman) even more seriously, particularly when considering certification for companies who have reshaped their portfolio and product strategy from monolith to MACH. In any case, we will only grant MACH membership if all our certification criteria are met. 

The MACH Alliance membership comes with the requirement that a vendor's entire active portfolio has to meet MACH criteria. So, if a company has a legacy past, we have an additional requirement. That is for them to agree that they no longer actively sell nor promote any legacy product so that they don’t create buyer confusion. <a href="https://www.machalliance.com/insights/why-only-companies-can-be-mach-certified-and-not-products" target="_blank">Certification is for the company and not individual solutions</a>. Buying MACH is a seal of being future proof. Hybrid-MACH isn’t a thing. 

Until recently, we haven’t had any vendor members that have reshaped their portfolio substantially enough for the new global trend to become MACH certified. All of our members have to date been founded MACH-first. What we do see, however, is that all tech vendors at scale are moving in the direction of MACH, but only MACH certification will show who is truly adhering to the standards that make enterprise software flexible and swappable and will actually ensure future-proof tech-stacks.

<h3 style="margin-top: 1em;">The Why Behind Our Certification Standards </h3>
We’ve always been crystal clear about what our certification standards are (you can read the full breakdown <a href="https://machalliance.org/insights/mach-certification-a-seal-of-confidence" target="_blank">here</a>). We believe the Alliance has a responsibility to the market to approach MACH certification with a high degree of objectivity and scrutiny. We know how hard it can be for a buyer to cut through industry jargon to understand if a vendor or agency is truly following composable architecture principles. MACH Alliance certification is our word that we have evaluated the technology, references and roadmap of a member and that they have proven they meet all the criteria for the Alliance to recommend them as part of a future-proof technology stack. 

Every organization should have the opportunity to prove that as the market changes, they too are eager to change. And when they meet all of our criteria with their present day product strategy, if the voting group has reached consensus, we welcome them with open arms to join in our mission.

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We have been vocal for some time that the market shift to MACH technology represents a major challenge to the position of long-established enterprise suites. Even the biggest tech companies are going composable with a focus on APIs and desire to be MACH. We fully encourage it.

MACH Certification Serves as a Vendor Benchmark for the Market Shift to Composable

The Why Behind Our Certification Standards

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