An Introduction to the

Gartner Pace-Layered
Application Strategy
 The Gartner Pace-Layered Application Strategy, or Gartner Pace
Layer, was released in 2010 and became popular, offering a unique
tool for Application Portfolio Management. Having first covered the
Pace Layer in 2015, we’re taking another look at new developments
involving business capability modeling & the pace layer, as well as
refreshing the definitions and guidance on the overall strategy.

With Application Portfolio Management (APM) rising in popularity,

it could be noted there aren’t an array of methods being offered to
help support application portfolio managers. Some commonly used
methods have been around for many years such as the Application
Portfolio Matrix by McFarlan in the 1980’s, and a few have come
to light in recent years such as the Federal Segment Architecture
Methodology (FSAM). This updated paper aims to provide the reader
with a summary of the Gartner Pace-Layered Application Strategy,
with a focus on new developments.

An Introduction to the Gartner Pace-Layered Application Strategy 2

What is the Gartner
Pace-Layered Application
Strategy™?
The Gartner Pace-Layered Application Strategy is a method to categorize
applications, according to their role in the organization, to support business
change, differentiation, and innovation. This categorization is performed
with the aim of applying different IT governance procedures to different
types of applications and accepting that different expectations, with regards
to the rate of change, should be applied to different applications.

Gartner summarizes the Pace-Layered Application Strategy as below:

“A new methodology for categorizing

applications and developing a
differentiated management and
governance process that reflects
how they are used and their rate of
change” (Gartner 2012)

An Introduction to the Gartner Pace-Layered Application Strategy 3

Pace Layers are described as follows:

“Gartner applies the term “pace layers” to the evolution of applications

in an organization...

These architectural layers have different “paces” of change, but they

must be designed to work together so that the building can function
effectively.” (Gartner 2020)

It is worth noting that applications are not classified as entities

themselves, this wouldn’t be effective since value is achieved
not from the application itself, but rather from the usage of the
application. Pace Layering therefore, classifies the application and
the processes it supports. This means that you cannot find lists of
applications and their pace layer classification, and an application
may move between layers over time as usage changes. Dennis
Gaughan, Managing VP at Gartner makes it clear “The same
application may be classified differently in one company than
in another, based on its usage and relationship to the business
model. We expect to see applications move among layers as they
mature, or as the business process shifts from experimental to well-
established to industry standard” (Gartner 2012).

The below describes the criteria used to categorize applications

when Pace Layering:

An Introduction to the Gartner Pace-Layered Application Strategy 4

 Systems of Record Systems of Differentiation
Simple Definition: Applications which support standard, Simple Definition: Applications which support non-standard
foundational business processes (Gaughan 2012). differentiating processes (Gaughan 2012).

Detailed Definition: Established packaged applications or Detailed Definition: Applications that enable unique company
legacy home-grown systems that support core transaction processes or industry-specific capabilities. They have a medium
processing and manage the organization’s critical master data. lifecycle (one to three years), but need to be reconfigured
The rate of change is low, because the processes are well- frequently to accommodate changing business practices or
established, common to most organizations, and often are customer requirements (Gartner 2012).
subject to regulatory requirements (Gartner 2012).

An Introduction to the Gartner Pace-Layered Application Strategy 5

 Next Competitive Advantage

Systems of Innovation
Simple Definition: Applications which support new,
Systems of Innovation New
Ideas
experimental processes (Gaughan 2012).

Better
Detailed Definition: New applications that are Ideas Systems of Differentiation
built on an ad hoc basis to address new business
requirements or opportunities. These are typically Systems of Record Common
Ideas
short lifecycle projects (zero to 12 months) using
departmental or outside resources and consumer-
grade technologies (Gartner 2012).

Unique Processes Standardization

Figure 1 shows a quick reference summary of the Current Competitive Advantage Operational Efficiency
layers at a glance along with a brief explanation: Compliance

Figure 1: Gartner’s Pace-Layered Application Strategy (Gartner 2020)

How
How
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Why Use the Gartner Pace Layer?
Gartner suggest that there is a fundamental disconnect in the strategies
pursued by leadership, by management, and by IT. Management seek
applications that are easy-to-use and reliable. Leadership want to be
able to mitigate risk and take advantage of new opportunities. IT aim to
reduce cost, minimize complexity and improve security. This leads to the
conflicting desires for both continuous change, and tight control on any
change. The Pace-Layered Application Strategy aims to help this issue.

Gartner developed the pace layer after discovering organizations

commonly applied the same investment strategy and governance
approaches to all applications regardless of their scope or usage. As
Gaughan puts it

“The one size fits all approach does

not work and you need to look at
applications in the context of the
business value they provide for the
organization and their rate of change
differs as a result” (Gaughan 2012).

An Introduction to the Gartner Pace-Layered Application Strategy 7

The idea of pace layering is based upon the concept of shearing layers in
building architecture (Gartner 2020), whereby different layers within the
building change at different rates. One example of this is that while the
structure of the building may last for thirty to one hundred years, the skin of
the building may change to accommodate new styles or to incorporate more
energy efficient designs. With this is mind, the fundamental concept of the
Gartner pace layer is that different types of systems should develop more
quickly than others and as such they should be treated differently.

The pace layer suggests that different types of system require different IT
governance strategies which may range from strict control for systems of
record through to ad-hoc for systems of innovation.

“The Gartner Group has introduced the

concept of Pace Layering, encouraging us
to not only acknowledge that things need
to change at different paces, but also to
embrace a strategy for IT governance
that fosters innovation alongside prudent
change control.” (Syx 2011)

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 One of the primary drivers behind usage of the pace layer is to enable As previously mentioned, the Pace Layer is built more around application
applications to be treated differently, this works on the premise that an usage classification than application classification, since the categorization
organization is prepared to treat applications differently dependent on method calls for implementers to “Analyze the characteristics of each
their category. The benefit, according to Gartner, is that by enabling this application and process”, and as Gaughan states, an application can
special treatment for specific applications organizations can achieve a be classified differently at one organization versus another, based on
faster response time and a better Return on Investment the business processes the application supports, and is expected that
applications move among layers as they mature, or as the business
processes evolved. (Gaughan 2012)

“We believe this same idea of pace

layers can be used to build an
application strategy that delivers
a faster response and better return
on investment, without sacrificing
integration, integrity or governance”
(Gartner 2020).

An Introduction to the Gartner Pace-Layered Application Strategy 9

The Pace Layer and Research &
Development
Market to
Opportunity
Opportunity to
Order
Supply
Chain Manufacturing Order to Cash

Business Capabilities Strategic Architecture

Definition
Product
Planning

Product Marketing
Opportunity
Management

Order
Forecast and Damand
Management

Production and
Production
Scheduling
Order
Management

Finished Goods
Platform/Ingredient Assembly
Lifecycle and Roadmap Tracking Supply Planning Inventory Management
One of the new developments for the Pace Layer has Channel Sales Compensation
Product Data Materials Sourcing Work in Progress
Management/Reseller Management Invoicing
Management Design and Strategy Inventory Management
been a focus on aligning the strategy with business
Product Environmental Customer Account Materials Requirements Performance Accounts Receivable
capability modeling. Gartner state that “we have Compliance Management Planning Monitoring and Collections

found that starting with discussion and mapping Pricing Outsource Customer and
Manufacturing Post-Sales Support

of business capabilities into the three pace layers is

Supplier Sourcing Plan Materials Procure Goods Plan/Manage Inventory Contingent Workforce
critical for success.” Sourcing
and Selection Requirements and Services and Warehousing Management

Investment and Budgeting and Accounting Controls Accounts

Finance Treasury
Capital Management Reporting and Compliance Payable
Business Capabilities are now considered to be the
starting point for the strategy, as opposed to diving Recruit and Hire Leadership/Workforce Talent/Workfoce Core Services and Learning and
Human Capital Management Employee Retention Development
Engagement
straight into the categorization of applications
Fecilities and Asset Fecilities Environmental Health and Physical Security
to different layers. By using a capability model, Fecilities Planning Operations Safety Compliance and Mitigation

communication between IT and the wider business is

Legal Intellectual Property Competition and Compliance, Privilege Corporate
improved, leading to greater engagement. Management Litgation and Privacy Affairs

Figure 3: Governance Difference between the Layers (Guay 2011, 17)

Figure 2 demonstrates a Business Capability Model
that has been segmented into pace layers:

How to Start andto

An Introduction Organize a New
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Application Strategy 10
 How to Implement the Gartner Pace Layer
In order to implement pace layering the below steps have been suggested:

1 2 3
Define a new Business
Engage key Segment business
Capability Model or
stakeholders in the capabilities according to
review an existing
pace layer concept. the different layers.
capability model.

Match each application

4 5 6
Compile an
with the corresponding
application portfolio
capabilities that it
or inventory, Review the fitness and
supports; Use the pace-
decomposing existing value of applications.
layered application
suites into individual
characteristics as a
applications.
starting point.

7 8 9
Regularly measure
Establish a set of
Adapt your application the impact of the
connective technologies
governance model to application strategy.
to facilitate the
fit the objectives and Encourage users to think
interoperability of the
needs of the three about applications and
application within and
layers. processes based on their
between layers.
probable rate of change.

(Guay 2011), (Gartner 2020)

These steps refer to the pace-layered application characteristics, which are
defined as below, however this is not a prescribed set of characteristics but
rather a suggestion:

An Introduction to the Gartner Pace-Layered Application Strategy 11

 System of Record System of Differentiation
Process Characteristics: Structured, repeatable Process Characteristics: Configurable, Autonomous

Data / Information: Highly Structured, Well Managed, Mainly Data / Information: Internal and External, Some Unstructured,

Internal, Audited More Dynamic

Content: Static / Stable Content: Both (Static / Stable & Dynamic)

Change Control / Governance: Strict Control and Testing Change Control / Governance: More Streamlined

Business Engagement: Formal Governance Process Business Engagement: Part of the Team

Planning Horizon: 7+ Years Planning Horizon: 1-2 Years

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 System of Systems of Systems of
Record Differentiation Innovation

Process Change Strict Change Control Experimentation

Systems of Innovation Architecture Traditional Alternate Platforms

Process Characteristics: Dynamic / Ad Hoc

Data / Information: Structured and Unstructured Data, Funding Capital Process Departmental Investment Pool
Heavy Reliance on External Data

Content: Both Dynamic

Waterfall Incremental
Change Control / Governance: Ad-Hoc Development Agile Practices
& Iterative
Business Engagement: Doing the Work Practices

Planning Horizon: 2-3 Months (Guay 2011)

Business Formal Process Part of the Team Doing the Work

Engagement

7+ Years 1-2 Years 2-3 Years

Figure 3: Governance Difference between the Layers (Guay 2011, 17)

An Introduction to the Gartner Pace-Layered Application Strategy 13

 Conclusion
The Gartner Pace-Layered Application Strategy can offer
organizations a way to categorize applications, therefore
feeding into decision making in a number of areas. Provided the
technique is rigorously applied, this should lead to a multitude of
benefits.

Gartner have continued to develop the strategy since its release,

with the most notable development being the interlinking with
business capability modeling. Capability Modeling is another
growth area for business strategy, and this link may enable the
more rapid adoption of both for forward looking enterprises.

Having another technique in this area (APM) published and

promoted by Gartner has led to widespread adoption. This
technique is becoming well recognized and adopted already and
there are some success stories beginning to emerge. With this
in mind, it is a technique all APM implementers should consider
when looking to define different strategies to complement the
application roadmap.

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 References
Guay, M. (2011) “Gartner’s Pace-Layered Application Strategy”
Gartner (2020) “What Is Gartner’s Pace-Layered Application
[Slidedeck] Available at: http://slidegur.com/doc/169615/sd08
Strategy and Why Should You Use It?” [blog] Available at:
https://www.gartner.com/
Rayer, N. & Van Decker, J.E. (2011) “Use Gartner’s Pace Layers
document/3739017?ref=solrAll&refval=280361291
Model to Better Manage Your Financial Management Application
Portfolio” [PDF] Available at:www.financialexecutives.org/
De Visser, H. (2014) “Flash Back at the Ramp of a New Era in
KenticoCMS/getattachment/Communities/Committees/Finance-
App Development” [blog] Available at: www.mendix.com/
--IT-(CFIT)/resources/CFIT-September-2011/Use-Gartner-s-Pace-
blog/flash-back-ramp-new-era-app-development/
Layer-Model.pdf.aspx

Gartner (2012) “Gartner says adopting a Pace-Layered

Syx, S. (2011) “Pace Layering allows for different paces of change”
Application Strategy can accelerate innovation” [Press
[blog] Available at:www.doozer.com/developer-exchange/pace-
Release] Available at:
layering-concepts
www.gartner.com/newsroom/id/1923014

Gaughan, D. (2012) “Introducing the Pace Layered

Application Strategy Special Report” [blog] Available at:http://
blogs.gartner.com/dennis-gaughan/2012/02/03/introducing-
the-pace-layered-application-strategy-special-report/

An Introduction to the Gartner Pace-Layered Application Strategy 15

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