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For the last couple of years the job considering integrating legacy systems with the SAP ERP system has stayed the same. Each system is unique, so integration had to start from scratch. There could be some limited reuse between integrations, but they did not have a large impact.

Many of companies are going to use SaaS (at least that is what many company is betting on). SaaS strategies could be seen as a way to get a best-of-breed application. Some of the SaaS applications are probably going to replace old legacy applications or reduce the number of more legacy applications being created. Integration between SAP and SaaS applications are wherefore going to play a large role in the integration work done with PI.

My experience with integration with a systems, is that it takes an average of 10 days pr system (The development could be completed within 2 days, but support during testing and bug tracking is required). If the complexity is getting larger or requires the use on new services in SAP, the number of days will skyrocket. Large parts of the integration work are concern error handling, when some unexpected data is received. The price for 10 day integration is at least €10.000, but with a high uncertainty. Such start prices will many business cases fail in adopting a SaaS application, because of the initial investment.

One way to lower this price is if the SaaS vendors also use the same Enterprise Services that SAP is exposing. Then integration will just be to connect the two interfaces and will just require testing for the business functionality. From a customer perspective this would be the ideal situation, and lower the cost of integration.

If there are no Enterprise Services to cover the SaaS integration, two things should happen; Either an Enterprise Service is created or a PI integration is created. The two options can be produced by a consulting partner and then shared under some license. Open source could be an option if it was supported by the SaaS provider.

Creating reusable integration parts can be difficult, especially in small markets like Denmark. The Danish government was very keen on electronic invoices(OIOXML), using the UBL standard. That led to a race for consultancies to create templates for integrations. I do not know any company, how got a large enough part of the integrations, to have justified a large upfront investment a shrink wrapped solution.

Reuse is possible for some domains. I have been involved in project, where reuse of BPM functions lead to easy integration with the 2th and 3rd application. In this project the Enterprise Service was implemented as a ccBPM in PI. The later integrations needed some adjustments to support the new functions and integration protocols, but the overall framework proved successful.

We asked the vendors of the third party application, if they had any integration to SAP. They all did have some integrations, but for different versions of SAP and application components. Challenges like this are going to continue because of the flexibility in SAP. In some cases can different modules handle the same functions. I doubt an Enterprise Service should handle the functionality in two different modules.

With SaaS application is the marked larger since it is global and allow for packaged solutions. The packaged solutions can both be PI mappings and BPM’s or Enterprise Services and sold via Ecohub or from the SaaS vendor.

A way a business model for this could be to give a lower rate on the first implementation; then sell this integration to other customers. It will take a few iterations before a shrink wrapped integration can be released.

To have an integration for SAP must be a really interesting for SaaS providers, because it will make it easier for customers to start using their services. If the customer is going to spend a large number of days on integrating the application, it is less likely to happen. Without an integration to the ERP system, some of the benefits are removed from the application.

For consultants will it also be interesting, if you only have to produce something once and then be able to sell it multiply times. The issue is then how the global marked can be supported, but remote consulting via VPN can probably solve most of the issues.

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  1. Iliya Kuznetsov
    Hello, Daniel,

    Your blog is interesting, because there are many realistic sentences about our future.
    It’s very unexpectedly to realize that SaaS solutions has valuable share on the market.
    I has known only two or three these ones: corporate Google mail (hosted only on Google’s site, as far as I know), SugarCRM (both provider- and customer-located), “BOSS-Kadrovik” (russian HR/HCM software), that’s all.

    How it’s possible — to extend SaaS software products which are hosted somewhere outside of customer, on provider’s side?
    (yes, it’s clear that PI could be good place for intermediate integration logic).
    Does Danish customers are using SaaS applications in dayli enterprise work?

    Basically, I now on stage of first three sentences from your blog: job is the same, systems are unique (with SOAP, SQL, XML/CSV/DBF/XLS files, etc) and there is no large place for making common integration solutions which could be sold or just interested for big markets.

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    1. Daniel Graversen
      Hi Iliya,

      Also have a look at Salesforce (CRM), in denmark we have purchasing portals which is a hosted SRM, payroll systms. I believe that many some of the SaaS solutions can be rather small for a target group.

      I have been involved with a HR/payrole integration, where the payrole system was a SaaS. But otherwhice I have not seen a lot of integrations yet.

      You are right that the job is the same, and it might be deficult to make large sales on an integration solution. But if the right SaaS product was created, it require a lot of integration.

      /daniel

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        1. Daniel Graversen
          No I have not. I have had an request for extinging APIs to add more logic to the hosters site. But I think logic could be performed in SAP PI.
          /daniel
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