GAINS On Podcast S2 EP8: The Real Meaning of Composability in Supply Chain with Nucleus Research

Speaker 1 (00:02):

Greeting, supply chain thinkers, technology tinkerers, and transformation seekers. Joe Davis here, your Friendly Neighborhood podcast host, welcome you back to season two of Gains on the podcast that guides you through the winding trails of modern supply chain strategy, planning, and design powered. As always, by the brilliant minds at gains. On today’s episode, we’re tackling one of the most buzzed about and misunderstood terms in tech composability. What is it really just vendor hype or is it a true shift in how we build and manage supply chain systems to help us separate the signal from the noise? I’m joined by gain’s own Amber Sally and Charles Brennan from Nucleus Research. Together they explore what composability should actually look like, why outcomes not architecture should drive decision-making and how companies are getting big results without big, bloated implementations. Ready to get into it? Amber Charles, welcome to the show. 

Speaker 2 (01:02):

Thank you, Joe, it’s a pleasure to be on. 

Speaker 1 (01:03):

Could you tell us a little bit about nucleus research? 

Speaker 2 (01:07):

So from a very high level, nucleus research is the global provider of technology, research and advisory services that really focuses on return on investment. Now, this is mainly done through end user conversations, which really serve as a backbone for products such as the supply chain planning technology value matrix, the report we worked on together this year and everything that we really do here. So like I mentioned, so really financial focus here and I manage and cover everything from ERP and supply chain. So yeah, really happy to be here today and discuss composability. 

Speaker 1 (01:41):

Great. Yeah, composability is something that we’ve really taken a focus on and I’m excited to talk about it today. So Amber, you worked with Charles on putting together this report? 

Speaker 3 (01:52):

Yes, I did. We have shared with Charles the gains vision for composability. We shared with Charles what we’ve been developing, what we are planning to develop as part of our roadmap, because evolving towards composability is not something you can do overnight. You can’t as a vendor wake up and say, Hey, we’re suddenly going to be composable, so over the next couple of quarters, let’s modify or change some things in our tech stack. And hey, we can start to market ourselves as composable. Well, yeah, you could market yourselves as composable, but you’re not really composable. So we shared, so we shared what we’ve been working on with Charles to show him that Gaines is committed to moving towards a fully composable environment, leveraging micro microservices, moving to a cloud native hyperscale environment, being able to help companies compose and recompose their environment that they’re using with technology to support their planning activities. 

Speaker 1 (03:05):

So I guess my first question is, when we talk about composability, what are we talking about? What does that mean? 

Speaker 2 (03:11):

So from the way I see it, a composable solution is a system that is made up of individual components. Think of them as sort of building blocks that can be added, replaced, or upgraded independently without really overhauling or changing the entire system. So when you think about it from a supply chain standpoint, instead of buying one really giant platform that handles everything, just really hard to change and navigate. A composable solution really lets you plug in just what you need. Think about a lead time prediction tool or a new forecasting model. And like I said, you can really do this without overhauling the rest of your system, and it really allows you to compare or compose these through APIs and cloud native infrastructure that Amber mentioned. So yeah, that’s the way I see it from a very high level. And it’s not really a product itself, it’s really how products are built and delivered, which basically allows organizations to be more flexible to adopt new technologies. 

Speaker 1 (04:04):

And I know we’re all about flexibility at Gaines. Amber, from your perspective, does that align with what Gaines is doing? 

Speaker 3 (04:12):

Oh, yes. It aligns very well with what Gaines is doing, and I think that Charles gave a pretty good definition of compostability, especially if thinking about it as this is a process, an approach that a company and a software vendor has to support. One thing that I want to add, and this is I think most the audience knows that prior to joining Gaines, I spent several years in a role similar to Charles where I was looking at the market and looking at the vendors in this space. And where we are distinguishing ourselves and really leaning into is this notion of transitioning away from what we call a monolithic architecture, which is a very rigid architecture and it’s inflexible. It makes it very hard to be able to do the things that Charles had explained in his definition for composability in gains. We have put the stake in the ground to say we are moving away from the monolith. We are moving to a fully composable services oriented architecture, which is something that most software vendors, especially in supply chain, supply chain planning and design, have not yet messaged themselves as making that full transition to a fully composable environment. 

Speaker 1 (05:38):

So Charles, in your analysis of gains, the report that you delivered, which you can download on the website now, gains systems.com, in your analysis of that, you described the composable architecture as a response to rigid outdated system. So I guess what was most surprising to you when evaluating how Gains delivers? 

Speaker 2 (05:58):

Oh, sure. So I think the biggest thing that surprised me is how literal the company takes it, right? Amber mentioned some organizations now they talk about composability, but it’s not really there. So when I think about it, it’s not just architecture on paper. It really shows up when customers are able to adopt new capabilities without really having to get it involved that much. We’re talking about, as I mentioned earlier, deploying some machine learning tools for lead time prediction per se without rewriting their entire tech stack or waiting six months for integration approvals from it. From my lens, as an analyst, that’s pretty rare. As I mentioned, most vendors talk about it as a roadmap item, but Gaines really treats it as an operating principle where their applications and products are really built on. 

Speaker 1 (06:44):

Right. You mentioned several times the big digital transformation and the time takes. I imagine with a rate of change that we’re seeing in the world, who knows at the time of this recording what the situation will be, but with the way that things are changing at the rapid rate that things are changing, I imagine having to sit down and again sort of realign a huge tech stack could take a lot of time. How does composability sort of compensate for that? 

Speaker 2 (07:09):

Well, if you really think about it, right, my biggest thing is that organizations, they need to focus more on operations and less on it. And this is the best way to do it. If you’re trying to be more efficient in whatever you’re doing, you need to improve your forecasting. That shouldn’t wait over long periods of time to discuss with it, discuss with management and how you should do it. It’s really be something that you ultimately, as cliche as it sounds, kind of plug and play in. And that’s what organizations have the advantage of when they adopt a composable architecture. But like I said, that’s kind of how I see it. It’s really flexibility with having to get so many cooks in the kitchen, which at the end of the day, slowly everything down. 

Speaker 1 (07:48):

Well, I guess a question I have is what are the risks of getting composability wrong? 

Speaker 3 (07:54):

So Joe, maybe we can think about it this way. I wouldn’t, don’t know if I want to characterize it as getting composability right or wrong. Maybe if we think about what’s the challenges with misunderstanding what compostability really is? 

Speaker 2 (08:11):

Yes, very much though. Yeah, 

Speaker 3 (08:14):

And I think if we take it from that lens, and if you misunderstand what compostability really is, it’s easy to not understand. One, the vendor claims for composability, you might begin to engage with a vendor who has message. They have composability, but maybe their underlying architecture is still a monolith. Then you could possibly get stuck in a position where you do have, at the core a very rigid environment that makes it very difficult to be flexible like Charles has been sharing. So I’d say that that’s one big challenge with getting it wrong or misunderstanding it. Another thing with misunderstanding it is if you misunderstand it and you propagate the misunderstanding throughout the entire organization, the new organization itself is not going to become a composable organization that’s supporting composable thinking composable. So you again, think you’re composable, but you are still adhering to classical practices for supporting your end-to-end supply chain. So still doing these sequential stepwise planning processes and are not able to have that more flexible approach to manage your supply chains as business conditions change in a very effective way. 

Speaker 2 (09:50):

And I think the biggest thing comes back to that education standpoint is that a lot of times you see vendors kind of slap the term composable onto legacy and really call it a day, and customers might not know exactly what that means and kind of just buy into this vision that they don’t even know what’s really going on. So I think Gains has done a great job at educating the market. We hope we did this well with the report that we worked on them with together and just having customers understand what the right way to do it is and the right way to approach it and have them go from there. So that’s my biggest thing is education. And that’s what we try to uncover here. 

Speaker 1 (10:27):

So if I’m in the market for a supply chain solution and I look at things and I think, yeah, I think composability is going to be important to me, I want to have that kind of agility. I want to be nimble in my processes and not have to involve it every time I want to make a change to one of my policies or processes, what should I be looking for? And is there anything in particular that from your perspective, Amber, that gains does that other folks don’t do? 

Speaker 3 (10:56):

Well, one thing that Charles has mentioned that I want to emphasize and really lean into is this notion that with composability, you don’t have to have these long drawn out projects, but you also don’t have to think of it as having to rip and replace what you already have in existence to support supply chain planning and design if you have already invested in some sort of commercial solution for planning or design. And to Charles Point mentioning demand forecasting, or as we’re starting to call it at gains demand prediction, if you want more sophistication in demand prediction, then you can use a composable service such as a composable service from gains and port it into your technology environment so then you can get the incremental value without having to have that very large financial outlay in the beginning and don’t have to wait for these multiyear projects to be carried out to start to get value out of the initiative. 

Speaker 1 (12:19):

So help me understand, it sounds like to me, and I love a metaphor, so bear with me, 

Speaker 1 (12:28):

This reminds me a lot of people hot rotting their cars. I’m here in Detroit, so everything relates back to cars, but I buy a Ford, I like it the things that it does, but it’s just not quite the way that I would want it, the way that I would build a car myself. So if I were to start adding aftermarket parts, so maybe I add a supercharger to make it go a little faster, maybe I do some aftermarket breaks and I add these things. And so is that kind of what it is, is composability allows supply chain professionals to take a base ERP and just trick it out fast and furious style until it becomes your ideal tool? 

Speaker 2 (13:10):

I would say in theory, yes, that’s relatively accurate. I do like the example you gave there, but ultimately, like we said, it’s about being nimble in the market. It’s about adopting these new solutions like demand prediction and just going to market faster with better solutions to help your customers at the end of the day. That’s the way I see it, right? It’s an operational need to be efficient, especially with the market we’re in today. But yeah, I think that’s a very interesting example you brought up, Joe. 

Speaker 1 (13:39):

Thanks. So how does Gains microservice driven API first approach compared to other vendors in the supply chain space? Charles, 

Speaker 2 (13:47):

Honestly, as I mentioned, a lot of vendors use or slap the word composable, but when you really dig in, it’s as Emper also mentioned earlier, alluded to, is it’s more of a wrapper on top of these monolithic systems. And the biggest thing about gains is it kind of breaking these functions down into these microservices and delivering these capabilities, but ultimately bolt onto existing systems without that large lift that we’ve discussed. And that’s a huge differentiator because it actually allows these businesses to solve problems without waiting on tech teams or to trigger a massive system update. It’s all about doing things faster at the end of the day because waiting time ultimately you can miss opportunities to capitalize on, and especially in supply chain today, that can cost your company millions of dollars if you have to wait a day, two days. Think about these large organizations. They need to be efficient the way to do. 

Speaker 1 (14:40):

Yes. Yeah. Amber, do you have an example of a gains customer that was able to avoid a full system overhaul by using gains composable solutions? So I know we talk about building the plane while we’re flying it a lot. It kind of sounds like what we’re describing here. Is there a customer of gains that stands out as somebody who benefited from the composable aspects of gains? 

Speaker 3 (15:03):

Yes, there is. But before I go into that, I want to give a little bit of commentary on the question you just asked and follow on with Charles’ response. So the gains approach or the way that we have approached our vision for Composibility and actually our vision for a company as a whole is to focus on outcomes. At the end of the day, we want to improve outcomes and help companies think of, well, what is the outcome that you’re trying to achieve? And how can the technology help you with achieving those better outcomes? Now, when it comes to composability and how we have started to build our approach to composability is thinking of what are the needs from a service perspective for the end user. And where that might vary from others is an approach that a company could take for becoming composable is looking at all of their products and features and thinking we’re just going to take what we have and what we offer to customers. 

Speaker 3 (16:12):

We’re just going to break those down into the moat for the smallest service size that we can, and then we’re going to create those as the independent services that we will sell going forward. So it’s kind of just taking what has been in place for a long time, refactoring that into a independent set of services and then selling what you already had before. But what we’re doing is we’re just totally rethinking of what do supply chains need to be most effective and to have better outcomes? And that doesn’t necessarily mean we’re going to have future parity with what we have in our existing system. We’re looking at everything we’ve offered before to see, well, what’s changed since we built the code for this that might make this a product or feature that actually isn’t necessary anymore? Is there a better way that this can be done? 

Speaker 3 (17:14):

And if the answer is yes, there is a better way, well instead build that better way and not build the capability or the function or the product or the feature that we had before. So we’re taking this as an opportunity to actually rethink what should be contained within a software package to support specific outcomes. And as we think further about services that we’ll build in the future, this idea of outcomes and the actual needs of customers is going to be paramount. So the example that I want to share is the example that Charles had written into the report about our customer border states who uses our lead time prediction service. And what the state time prediction service does is it gives a more accurate prediction of your supplier the times by looking at a very large amount of data within your business environment and helping to identify correlation within data that can give a stronger prediction or a better sense of what a lead time for a supplier is actually going to be. 

Speaker 3 (18:34):

And in this example, border states started working with our Gaines lab group where Border states said, our here’s our overall problem, how can you help us solve it? And we didn’t go in with any preconceived notions of how to solve this problem, but we knew their objective was to get a better handle on the increasing variability of their lead times. And we experimented with them and experimented with AI and machine learning. And then we ultimately created an approach that we saw something that could be helpful to a very wide range of companies and then decided, well, this is going to be one of the services that we will build and make available in our disposable environment. So I led with that preamble and gave this example to show that we are taking, and again, this outcome based approach, objective based approach. And we’re not just going in just building services just for the sake of building services. We being very thoughtful about what the needs of a supply chain is and creating services to support those needs. 

Speaker 2 (19:50):

And I think to piggyback on that too is kind of reiterating the value of the business outcome there. From my conversation with the organization, by utilizing this lead time prediction tool will ultimately help them obviously, as Amber alluded to anticipate supplier delays reduce that uncertainty. The organization was ultimately able to eliminate the need for excessive stock, ultimately reducing these holding costs by 10%. And also the organization lowered its financial impact of these long lead times, right as each additional day of the lead time require an extra, I believe it was seven and a half million dollars in inventory investments. So going back to what I said before, a few days can really be a detriment to your organization, so you’re able to adopt new solutions faster, it be that much more efficient. As Amber mentioned, the business outcome is tremendous, and that’s ultimately the biggest thing. At the end of the day, it’s all about the business outcomes for customers. It’s all about customer success there. And that was a great use case of a customer deploying a composable solution and realizing value from it, right? 

Speaker 3 (20:54):

Yeah, the incremental improvement one service, plug it into the existing environment and then they solve great benefits, but it’s an incremental group and you didn’t have to have that multi-year implementation project. 

Speaker 1 (21:09):

Another thought provoking episode of Gains on Unpacked, examined, and neatly filed into your supply chain toolbox. A big thanks to Amber, Sally and Charles Brennan for breaking down composability and showing us that flexibility isn’t just a feature, it’s a strategy from hot rotting software to measurable business outcomes. It’s clear that the future of supply chain isn’t about ripping and replacing. It’s about building smarter, smaller, and more focused solutions that actually work. If this episode sparked your curiosity, don’t miss part two of our conversation where Amber and Charles dig into ai, faster time to value and the human side of planning transformation. Until then, keep innovating, keep learning, and remember in the ever-changing world of supply chain, we’re all in this together. This is Joe Davis siding off from another enriching episode of Gains On. Until Next Time, want to stay connected with all things gains and continue to explore the exhilarating world of supply chain planning and design. 

Speaker 1 (22:13):

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