When determining the value of integration, two key questions are frequently asked:
- What’s the fraction of a project cost that has to be dedicated to integration?
- What kind of cost reduction can be expected from using a mature integration platform?
The answer? Cost reduction is only a part of the value.
But ok, I’ll be more specific.
- 50% is a number that has been widely used, and for a long time. Gartner in particular has used this number and in the last year expressed that it also applies to the use of SaaS applications.
- Organizations who have adopted a mature integration platform have experienced integration cost reduction up to 70%.
This becomes even more when you factor in new business capabilities and consequences of applications, such as lower consumption of application resources. But that’s another post.
These drastic reductions come from many aspects of integration projects, and the fact that integration is not a one-time project in a program. It is a real enabler of a program, the same as adopting an ERP. As such, it will provide value over time. Here are some examples of capabilities provided by mature and complete integration platforms, and the value they generate:
– Connectivity to integrate current and future systems without using custom code that will prove costly to maintain. Applications will go through upgrades, custom applications will be replaced, and channels of communications will be added. The value here is to reduce current and future integration costs.
– Support of integration patterns to comply with all current and future requirements without using various integration technologies. Publish/subscribe capabilities between various instances of the same ERP can help onboard new instances very easily, reducing future integration costs. Orchestrating service invocations to back-end systems not only reduce the development effort for front-end systems, but also unlock the opportunity to cache requests/route to back-up systems, improving the quality of service. It also unlocks the opportunity to modernize or replace some applications, generating economies of scale.
– Support of Continuous Integration, testing, and deployment, but also the right packaging unlocks value by reducing current development costs. It will also reduce future integration costs by allowing the organization—and preferably an ICC—to expose an integration service offering with SLAs. This makes it possible to efficiently address existing use cases with templates to configure or develop to address a net new use case.
– Instrumentation to capture and act on exceptions as they occur. Exceptions will happen, and resources will be dedicated to fixing them. Mature integration platforms allowing the notification of the right resource in the organization for immediate action will not only reduce the business impact of these exceptions, it will also reduce the cost of operation of the integration platform.
– Robustness to ensure various levels of quality of service. Initially, the organization will want to have just the infrastructure required to address the initial needs in terms of criticality and performance for the first ERP functions rolled out. And then scale or improve quality of service without major investments in clustering software or additional hardware.
Of course, all of these elements are contextual to the organization and its project. Because these are discussions we are having constantly with customers, we have capitalized on our integration experience and created a maturity model that allows organizations to:
- a) Assess their current integration capabilities
- b) Define which capabilities will make their integration more mature, in their context
- c) Measure the value of getting more mature, still in their context
If you’re interested to know more, the assessment is accessible here.
I can’t help myself. I’d like to acknowledge the value of creating new business functionalities. Many of the customers we work with do not consider the value of integration to be just cost reduction. Very often, their initial frustration was that integration budgets were mostly allocated to maintenance of integration. Integration costs were a tax on projects. After having successfully implemented a mature integration initiative, reduced costs allowed them to increase their support for new business initiatives and innovation. Their success metric becomes a fraction of the same budget as before allocated to new projects versus a fraction allocated to maintenance. Integration becomes an investment.