It is easy to find companies applying dedicated SaaS solutions with their ERPs today. For example, an organisation may choose to integrate a robust CRM app, like Salesforce, instead of the bundled option that came with their ERP. In fact, the advantages of best-of-breed outweigh monolithic solutions so much that many software companies own 20+tools throughout their technology stack.
A study by Forrester and Tanium found that best-of-breed tends to not yield the expected positive results. 70 percent of the respondents claimed their security and operational tools lacked full integration. As a result, workflow between different applications was considered challenging by 71 percent of them. The study also found the disconnect between different tools exposed companies to security risks and technological disruptions.
So, while monolithic ERP might be easier to install and train on, it enforces a generic workflow resulting in limited productivity. Even though best-of-breed allows a company to create a technology stack suited to their ways, it is difficult to integrate and maintain.
What’s the Deal With System Integration?
So, while system integration is clearly the need of the hour, unfortunately, companies still struggle with it. Studies found that as many as 70 percent of all systems integration projects fail to meet their goals. From underestimating project complexity to lack of accountability, system integration projects have become quite the boogeyman of IT today.
The proof is in the pudding!
Bridgestone, for example, made the news in 2012 for filing lawsuit against IBM for $600 million when the company was accused for implementing a new ERP solution defectively. As a workaround, Bridgestone had to actually turn of their automated systems and handle disaster recovery manually.
The US Department of Motor Vehicles (DMV) also encountered a major system hiccup. The organization attempted to overhaul their antiquated COBOL computer system in 2005. The new system, called MATRX, was intended to begin operations by 2008. After costly delays and being handed to three different vendors, the project was eventually scrapped without any results.
Finally, in 2011, the USAF pulled the plug on an ambitious project to replace 240 aging computers with a single, integrated solution. The Expeditionary Combat Support System (ECSS) was supposed to help the Air Force transform its logistics using off-the-shelf products. Seven years and $1 billion later, the project was scrapped.
Stories like these are far too common and highlight the importance of sound system integration practices.
Why Application Integrations Fail
At the face of it, application integration seems simple enough. How hard can making two systems talk be?
The full scope and ripple effect of an integration project, however, also needs to be considered and that is where things start to fall apart.
Say an organization starts using two software systems: Asana for workflow management and LiveAgent for call center management. They decide a custom API is needed for their particular requirements and task their developers to create one. The dev team works out a simple one-way integration, only to realize they now have to manage and update two tools separately.
Changes to either Asana or LiveAgent means updating the API and should the organization carry out endpoint system updates, then the overall workflow between the two apps will be affected. In other words, developers are often fighting against a butterfly effect of updates and changes, each with the power to undo their work.
Now imagine if the dev team has to manage integrations across 10 or more tools needing to synchronize on a number of endpoint systems. Not to mention, organizations often replace tools, which will need fresh integration across their tech stack.
While such problems are faced by companies attempting integration on their own, third party solutions leave things to want as well. Oftentimes, companies expect their EAS vendor(s) to carry out all integrations. ERP, SaaS vendors do offer APIs that can retrieve data from their systems, but integration with other (unsupported) apps is almost always the client’s responsibility. Even APIs provided are simple HTTP based. They usually fail to work with older systems and are useful only for data access and not so much for Business Process Integration (BPI).
Workflow rules are another major stumbling block in integration. As workflows define how a team will operate various tools, even miniscule changes can cause confusion down the value chain. Tools change how they collect data all the time. This is something an integration project needs to take into account. What happens if certain fields are removed from a tool? Will your API reflect this across all associated systems? What if some are not affected by the new schema?
Questions like these and more need to be answered before an API can be written.
How Postmodern ERP Enables Integration
When speaking of ERP, it’s easy to start thinking in terms of modules and functionalities. since these parts are pretty much taken care of in the cloud-powered era, postmodern erp strategies focus on integration instead.
This is accomplished by having one fundamental system of records, which is then slowly tied with different applications under systems of differentiation and innovation. In doing so, a postmodern system creates one source of truth from which a business can derive actionable information from.
Organizations will often muddle the boundaries between different roles, creating confusion regarding who owns what.
“Most organizations don’t do data or information management very well, so that’s at the heart of it,” Says Denise Ganly, an analyst at Gartner.
Data Management not only requires the right tools, but instilling organization-wide discipline regarding usage and ownership as well. The postmodern advantage is that it takes the organizational structure into account before setting the tools in place.
While the challenges of SaaS integration are not to be underestimated, brands should not be deterred by them either. By adopting a postmodern approach, brands can set themselves up to seamlessly navigate the integration landscape and create a technology stack that best augments their strengths.
The modern markets demand competitors to offer high quality products and services quickly. As catering to such high demand requires specialized tools available on demand, the business case for integration will grow exponentially. The postmodern ERP can help companies roll into such a framework much more fluidly than trial and error ever would.
If you are interested in learning more on how postmodern ERP makes integration easier, feel free to give us a call or shoot us an email. We will be happy to answer any queries you might have!