When you travel via road and want to get to your destination real quick, what do you prefer – a route with small stretches of patched-up roads that are haphazardly connected or a seamless highway where you could safely cruise at 75mph? The answer is obvious, right? Who wants to constantly stop, start, and take detours? Yet, when we look at an enterprise technology landscape, that’s what most companies have opted for in point solutions.

The Pitfalls of Isolated Point Solutions

Navigating the complex maze of enterprise systems, peppered with point solutions, is a major efficiency sinkhole. People juggle multiple apps that just don't sync, and switching between systems and re-entering information for the umpteenth time can be a major productivity and experience killer. Finally, this problem is getting the attention it deserves.  

Businesses are increasingly recognizing the limitations of isolated point solutions. These standalone systems impede the journey towards a more integrated, AI-driven future. The crux of the problem with isolated point solutions lies in their very nature – they are siloed, discrete, and often incompatible with other systems. This fragmentation is particularly problematic in an era where data is the new oil and AI is the engine driving business innovation.

1. Hindering AI-First Transformation - AI thrives on data – the more integrated and comprehensive, the better. Isolated solutions, by creating data silos, severely limit the quantity and quality of data available for AI algorithms. This lack of data leads to suboptimal AI models, incapable of delivering the insights and efficiencies they promise. Moreover, the lack of integration means that AI systems cannot learn from cross-departmental data, a necessity for holistic business intelligence.
2. Digital ROI Obstacles - From a financial perspective, isolated solutions represent a significant investment in resources, both in terms of capital and operational expenditure. However, their inability to communicate with other systems leads to a lower return on investment (ROI). Businesses continually invest in new solutions to bridge gaps, leading to a patchwork of systems that are costly to maintain and difficult to manage.
3. Scalability and Agility Concerns - In the context of scalability and agility, isolated solutions are doubly deficient. They are often tailored to specific, static needs and lack the flexibility to adapt to changing business requirements. This rigidity can stifle innovation and slow a company’s ability to respond to market changes.

To overcome these challenges, businesses need a new approach – a platform-first approach.  

The Transformative Potential of Platform-Based Models

Platform-based solutions are the highways of digital success and represent a paradigm shift in how businesses approach their technology infrastructure. These platforms sit on top of existing systems and act as unifiers—bridging the gaps created by isolated solutions and fostering an environment conducive to collaboration and innovation.

Bridging Data Gaps

Platforms integrate disparate systems, creating a unified data ecosystem. This integration ensures that data from various sources is collated, standardized, and available for advanced analytics and AI applications. By providing AI algorithms access to a rich, diverse dataset, platforms enable more accurate predictions, better decision-making, and a higher degree of automation.

For instance, Royal Philips reimagined their F&A processes, giving their finance team better visibility into risk, cash flow, and performance. This access to unified data and information helped them make informed decisions to steer the business in the right direction and improve overall resilience. Their (now automated) dunning process has enabled a 100% touch ratio of overdue accounts and improved collection by 21%.

Fostering Collaboration

Collaboration is at the heart of modern business operations. Platform-based solutions break down the barriers created by isolated systems, enabling seamless communication and data sharing across departments. This interconnectedness improves operational efficiency and encourages innovation, as ideas and information flow freely within the organization. For instance, A global clothing company connected multiple partners across their wholesale network, with over 90% of data visibility from all partners. This helped them improve demand forecasting, compliance reporting, and responsiveness to changing market trends.

Adapting to Ever-Changing Business Needs

In contrast to the rigidity of isolated solutions, platforms are inherently adaptable. They are designed to evolve with the business, accommodating new technologies, processes, and market developments. This adaptability ensures that businesses can swiftly respond to new opportunities and challenges, maintaining a competitive edge in a constantly evolving marketplace. For instance, A large US bank had to process 170K+ loan documents to assist smaller businesses during the COVID-19 crisis, which led to an unprecedented surge in Paycheck Protection Program (PPP) and Small Business Administration (SBA) related loan applications. On tight timelines, what helped them was connected operations at scale that enabled Straight Through Processing(STP) to process 15,000 digital forms per hour while adhering to stringent risk and audit requirements.

Why Platforms Are Critical in the AI Age

We're firmly in an era where AI and machine learning aren't just the big players on the field; they're the field! And these AI models are hungry for uninterrupted, high-quality data to perform to their fullest potential—something that a chequerboard of point solutions cannot provide. Moreover, as AI advances, the need for systems that can rapidly adapt and incorporate new AI capabilities becomes increasingly vital. Platforms meet both these needs – ensuring seamless data flow and the flexibility to change with the changing tech landscape.

The transition from isolated point solutions to integrated platforms is more than a technological upgrade – it's a strategic imperative for businesses to harness the full potential of their data, drive AI-first transformation, and achieve a higher digital ROI.

• Photo by Mohamed Nohassi on Unsplash