This article is excerpted from the report:
“The World of Integration”
available for download here.
At ChainLink we have had diverse projects, and interactions with clients who have a wide range of problems. Lately it seems the issue of integration is front and center with our clients — large and small.
In this series we will tackle the topic from a B2B and A2A perspective. Supply chain operatives are pretty familiar with B2B integration, but even that old world of EDI has changed. We will look at the challenges organizations are facing and how they are meeting those challenges. We will look at the technology market and provide some guidance on how to navigate it, whether you are line of business or an IT buyer.
Necessary Nuisance or Enabler?
After a spike more than a decade ago catalyzed by a buying spree of ERP, Supply Chain, web front ends and so on, one would think that a market like integration would be a no-grow or go-away market. But quite to the contrary, the tool suites, the delivery options, and sales of even traditional elements continue to grow. Why is this?
First, users have an insatiable desire for data — new systems, more reports — and therefore, as a new module or product is added to the enterprise portfolio, naturally the pipes have to be built between it and the rest of the portfolio. Companies that rely on manual or point-to-point tools reach a point where the pain of creating and maintaining them just gets to be too much. This (pain point) has basically been the driver right along.
Second, firms are confronting more issues that are driving the need for and the growth of the integration market, such as:
Cloud proliferation — today’s users are integrating more and more to a variety of cloud applications. That requires a refresh on the tools used for cloud-to-cloud and cloud-to-on-premise integrations.
Increasing end-points — more customer or supplier portals to integrate to, more apps, more devices, and disconnected enterprise processes. The Internet of Things will drive a huge explosion of data coming from trillions of devices that will need to find its way from source to destination.
More customer and trading partner interactions — behind the scenes in Omni-channel, home delivery, outsourcing, service logistics, and ecommerce sales are many more processes that require not only well-engineered workflow and web services, but accurate and real-time data. They are increasing the type and quantity of business process integrations between trading partners, thereby changing the B2B solution.
Automation of business processes and integration — users and IT would like to make the process of change easier. Business process management (BPM) tools and workflow engines are getting easier to use and often are part of the application vendor’s offering and the user’s solution purchase. So adoption of tools continues.
Revitalization of the IT portfolio — decades ago Richard Nolan1 proffered that the useful life of a software product is about seven years. Since the mid-nineties, when ERP became hot, there have been at least four major identifiable waves of technology transformation. Hence, even major firms are feeling behind the times and are re-evaluating, adding to, or outright replacing their investments from a decade or more ago to take advantage of the current innovations.
Being left behind — one of the sad challenges that users sometimes have to address is as ERP companies continue to release new products, they sometimes differ radically from the past. New code just does not work with the old code anymore. Users are on their own to re-establish connections, transform data, and so on. As disappointing as this must be, it does point to typical challenges for customers who have charted their own course (or just have little use for some of the new code offered by the vendors). If an enterprise also did a fair amount of customization, it is really on its own to manage and modify that code.
Relying on in-house developed, custom APIs and older middleware products has become too expensive to maintain. In large organizations, managing these tool sets takes on a life of its own, consuming many resources to maintain all the connections and code.
B2B vs. A2A — another interesting and challenging dynamic is the issue of trading partner/inter-enterprise communication vs. application-to-application communication. For many processes today these blend as third parties perform functions in a harmonious process with their partners. Though inter-enterprise, overall, these interactions are really application-to-application. Thus, B2B and A2A are being combined in one platform.
Meeting the Challenge, Gaining the Opportunity
In spite of all the talk within organizations about cross-functional cooperation, we still have all those islands. That, plus the reality of continued outsourcing of business processes, means that organizations will have to meet all the aforementioned and organizational challenges head on. Often we use the phrase digital supply chain2 which refers to the connectivity, integration, and collaboration between trading partners by using systems, rather than paper, for all processes — from planning to design. This is a real opportunity for organizations to leverage automated connections to monitor and manage their business more closely and to win more business though real-time responsiveness.
Meeting these integration challenges as well as taking advantage of the opportunities afforded by integration means making more tech purchases. However, the market is a bit confusing and very competitive with a diversity of offerings. So let’s move on and explore the market.
Before we look at solution options, we should reiterate that the integration market has not stood still. Billions of dollars have been spent to meet the changing information climate to connect in the cloud, connect mobile end-points, master big data, and solve that problem of seamlessness. It is also instructive to understand how integration capabilities can be acquired. The process of acquiring integration solutions today offers many variants. We will look at these first and then explore the capabilities and modules that can be acquired.
There several approaches to acquiring integration technology:
Purchase ‘neutral’ toolsprovided by third-party tools vendors. This is the largest segment of the integration market. These neutral tools can be purchased on premise or as part of the growing IPaaS (Integration Platform as a Service) option. At the high end, examples are Informatica, TIBCO, and Software AG; and in the mid-market are EXTOL International, Dell Boomi, Talend, MuleSoft, and others.
Acquire the capability as a built-in feature of the application suite. Solution providers, from ERP to Supply Chain, do have integration suites, either self-built or built with some critical partnership. Of course they need these tools for their own internal development, and they leverage them to make a portfolio of offerings that work together. The limitation here is that although end users benefit from this modern portfolio, they cannot use these tools for their own development. They are useful to integrate the designated application, but not beyond that. Examples here are Descartes Systems, Oracle Fusion, Epicor ICE, Infor ION, and JDA’s FLEX.
Buy (or access) integration tools from the application vendors. These are different from the ‘built-in’ application category mentioned above, since the vendors also have designed studio products for sale (though many give them away). IT or their consultants are using them to modernize and unify solutions across the vendor’s suite of applications. They also might be part of software development kits (SDKs) that vendors have for partners to develop on and enrich the community. Examples here in supply chain are GT Nexus and One Network; ERPs such as NetSuite and, of course, SalesForce.com; as well as SAP’s HANA/Fiori and NetWeaver combos.3
The above categorizations are important differentiators when thinking about the IT strategy since these decisions can be costly — in terms of license (or subscription costs), but most importantly the ongoing workload to the IT department. It is critical to understand how much the IT department will be ‘on their own’ to develop integrations and how much the vendor will provide in terms of pre-built: templates, APIs, rule engines, widgets, patterns; and specific knowledge of use cases and the commercial application portfolio used that can lighten IT’s load in developing and evolving the integration portfolio. This leads to the other option, which is open source.
Acquiring open source + freeware. The challenge here, of course, is lack of support. Often IT departments use open source freeware along with open source tools from commercial technology providers such as Red Hat, Talend, or WSO2. Open source providers are neutrals of course, but provide the user with access, theoretically, to libraries developed by other organizations, thus extending the value of the investment in the open source solution.
So let’s move on and explore these types of options and vendors in more depth with an initial discussion of the segments and their capability for integration. Regardless of how you acquire the technology, looking for these capabilities is probably the more important consideration.
We continue this discussion in Part Two: Market Segments.
1 Richard_L._Nolan — Return to article text above
2A recently published article about digital supply chain, Your Supply Chain is Calling You, can be accessed here. — Return to article text above
3 Of course, these would only be acquired to integrate into the SAP stack. — Return to article text above
To view other articles from this issue of the brief, click here.