What is a composable business? (2024) - Shopify (2024)

Chances are, you’ve heard the term composability when it comes to commerce platform architecture. Composable commerce platforms, in contrast to their monolithic antecedents, are made up of separate components that can be easily scaled and recombined to meet the changing needs of a business.

Composable platforms have risen in popularity over the past decade thanks to their flexibility. So too has the concept of composable business—an approach that breaks overarching business functions and disciplines down into their component parts. This allows for the same benefits as composable platforms, such as flexibility, and it also aligns business practices with the tech platforms that are built around them.

Let’s take a look at just what a composable business is, the benefits and challenges of practicing business this way, and examples of businesses that get it right.

What is a composable business?

You can think of the general concept of composability like building blocks that form a greater whole. The form of that whole could begin as a house, then evolve into a tower. Composable architectures can change shape and add capabilities relatively easily, because they’re made of blocks of different shapes, sizes, and functionality that can be evolved to fit a new need.

In contrast, monolithic systems are solid wholes. They’re the prefab house that comes assembled and it’s not easy to change what they do and how they do it. When you want to expand a monolithic system or add to or change functionality, you’ve either got to start from scratch or plan for a long development period in order to change it.

When it comes to tech stacks, this more modular approach to business platform architecture allows for greater flexibility and extensibility. Retailers and the developers they work with can pick their preferred third party services or apps and compose them into an ecommerce site. In theory at least (we’ll go into the realities below) this can be done at a speed that’s more in line with the speed of business in contrast to a traditional, clunky monolithic platform developed in a lengthy waterfall development cycle.

Leaders in composable businesses look for moments of composability. This could mean creating more modular and distributed teams across the organization. It could mean breaking services and functions down into smaller units that can be more easily repurposed as an organization pivots. More than anything, it means thinking flexibly, looking through the lens of the parts, rather than the whole.

The reasoning is much the same as with a composable tech stack: composable businesses are more resilient, allowing a business to quickly adapt in the face of uncertain business and consumer landscapes.

Gartner defines a composable business as one that is built on four main principles:

1. Agility through modularity: Business functions are broken into smaller components that can be rearranged and reintegrated into different business processes to create new services or products.
2. Speed through discovery: Those parts are easily discoverable. In a tech stack, this might mean being discoverable in an app store, so someone who needs a new tech capability added to power a new business function can pick out a necessary component for integration. At a business level, this might mean making a process known across the organization so that other business units can make use of it.
3. Strong leadership through orchestration: Well-maintained connections between components that are standardized and automated can be easily deployed across an enterprise in the ways that make the most sense for those departments.
4. Resilience through autonomy: Business components are their own little units, well encapsulated so that they can deliver on their mission with little dependence on other components. Just like little countries, these units can collaborate with each other or operate on their own. This enables quick and easy scaling, as it means weaving together more integrations.

These four principles guide the design and implementation of business components. This can refer to everything from the structure of teams and processes to the way new business opportunities are identified and acted upon.

Gartner further breaks these principles down into three building blocks:

• Composable thinking, an approach to creative problem solving that helps team members and organizations conceptualize processes and identify when it’s time to use them.

• Composable business architecture, a structuring of business processes that puts flexibility and resiliency at its core.

• Composable technologies, the modular pieces, parts, and connections of a technical stack that work together to support notions of composability.

Let’s get into more detail..

What are the benefits of a composable business?

Composable businesses come with a number of benefits, which mirror that of composable architecture.

Easier scaling

Composable businesses are easier to scale than businesses that are more monolithic in shape. With new customers comes the need for new infrastructure, new products, and new processes, whether we’re talking about additional back-end fulfillment capabilities or a new approach to more seamless checkouts. In a composable business structure, existing capabilities can be drawn from, reintegrated, and added to as new capabilities to meet demand. Rather than building entirely new systems that take months if not years to implement, business building blocks are simply added and built upon to expand.

Individual empowerment

Composable businesses empower the individual user or unit to fix problems and add new capabilities as needed. This local authority can increase efficiency and provide a better sense of ownership than in monolithic systems where roles are obscured.

Resilience and adaptability

Two of the biggest benefits of composable business are the organization’s ability to quickly react and adapt to market changes. While still a challenge, an unexpected and unprecedented event like the COVID-19 pandemic becomes a new challenge to pivot around with new processes, services, and products. For instance, a clothing manufacturer that viewed their processes in a composable manner might have pivoted quickly to produce masks using the same processes they used to make shirts. Composability allows businesses to plan for the current reality, and adapt quickly to the future.

What are the disadvantages of a composable business?

Organizational complexity and overhead

Fully composable organizations increase organizational complexity. Unlike with a clear hierarchical structure, distributed teams can be difficult to navigate when it comes time to coordinate. Who owns what, and who should any given person go to for feedback and development? It can also increase redundancy if the business units are operating too independently without enough cross-communication. This can in turn increase overhead and costs. After all, some problems are best solved at a more global level, rather than at individual, smaller scales.

Performance and reliability issues

Fragmentation can lead to performance issues, which can in turn slow business processes and technical development. The absence of shared processes can lead to different business units operating in wildly different ways—and this can make it difficult to design for. On the technical side, it can be challenging to debug a distributed system, and the lack of a shared code base can slow developer productivity.

Increased costs

From maintenance to operational costs, and everything in between, increased complexity leads to increased costs. The same goes for the security vulnerabilities created when there are disparate business packages rather than hardened units. Fully composable business structures and platforms can require a great deal of technical overhead and support, each of which have their costs.

How a composable business works

Here are few ways to get started in building a business that operates around composable commerce architecture:

Foster a composable mindset

A composable mindset encourages flexible thinking that’s responsive to a customer’s needs rather than being fixed and top down. In order to ensure alignment with customer priorities, it encourages research, coordination, and curiosity outside of strict silos. Who knows? Someone in a different department may have insight, processes, or procedures that are relevant to solving a problem in a different department—and it pays to collaborate.

Build a composable business architecture

Building a more composable business architecture doesn’t mean starting from scratch. Instead, it’s a lens through which to view your current business architectures so that you can begin to incrementally create more composability. For instance, when adding a business capability to address a new market opportunity, you might create a separate business unit to handle these new operations, rather than making it simply a piece of your larger operations. Bit by bit, as you add and integrate these capabilities to form a greater whole, your business will become more composable.

Build on a platform that’s opinionated in its composability

Business processes and technology mirror each other within an organization. If you build modular, distributed teams and processes, each of which are responsible for their individual output, that’s reflected in the technology that supports them. The reverse is true, because the structure of the team affects the output.

It can be difficult to know what to choose when selecting a commerce platform. You don’t need to go fully composable right away—or ever. There are disadvantages to relying entirely on microservices. Shopify offers complete optionality, providing composability where desired, while still working with a company’s existing platform and with hardened modules where they’re most efficient.

Examples of composable businesses

What does a composable business actually look like on the ground?

Let’s take the example of a cookie and candy delivery business that’s found a new market in shipping chocolate-covered fruit to a different country. Of their existing businesses, their cookie business is domestic and their candy business is international.

When breaking into this new market, the business can reuse and repurpose capabilities from their existing operations. They might, for instance, use the same packing and shipping process that they use for the cookie business, and combine it with the fulfillment and shipping capabilities of their international candy business. And on the technical side, the same composability of units would apply to the functioning of their platform.

One example of this approach on the Shopify platform is Everlane, which integrates Shop Pay onto their composable front end while still relying on their existing back end. This was a concerted choice for the company, which found a full replatform intimidating.

“We can see how to integrate it with the platform without needing a complete overhaul,” says Anna M. Peterson, product lead at Everlane. “Even our CX team can easily see and understand how things work, thanks to the user-friendly Shopify admin experience. This convenience makes it easier for different parts of our organization to support switching platforms in the future, as it ultimately benefits everyone in the long run.”

Shopify allows for different levels of composability, which mitigates the downsides of fully composable systems, allowing for faster time to market while providing the platform for the flexible practices of a composable business.

The right amount of composability

Composable businesses provide the flexibility and agility needed to keep up with today’s rapidly changing consumer and marketplace. But that flexibility can come at a cost. Shopify’s modular approach blends adaptability with the need for efficiency, speed, and security. In most cases, the goal shouldn’t be a fully composable business—it should be a business structure that balances the best of all worlds.

Learn what Shopify commerce components can do for you