Cloud computing aka SaaS and On-demand has become one of the leading trends in technology and business application space. A recent Fortune magazine has even identified “On-demand software” as one of the 4 tech trends to watch. There is no question that the current generation of Cloud computing brings significant value to its customers mainly due to:
- No Capital Expenditure
- Instant value
The economic atmosphere has even accelerated the adoption rate.
We currently witness a plethora of disparate point cloud solutions addressing a specific domain e.g. CRM, Sourcing, Talent management with limited integration concept. The main advantage is that these point solutions can quickly address immediate business problems. But those same solutions drive company’s landscape complexity up and thus inhibit agility, increase cost and provide limited value.
Companies, in general, strive to operate effectively as one integral entity and eliminate internal operation and information silos. Business application should reflect and support this desire. Separating customer relationship solution from the supportive operation and financial management creating islands of fragmented information and processes will harm effectiveness.
Building sustainable business applications requires addressing integration as a primary design principle. It should enable seamless support of end-to-end business processes that increase customer value and lower overall cost.
Integration is much beyond technologies including: web services, SOA and the likes. It requires addressing conceptual differences in:
- Business Solution – Scope definition e.g. does Sourcing include Purchase order processing
- Business semantics e.g. same language across solutions
- Master data
- Life cycle management
- ..and process integration
Since cloud solutions operate outside the company’s firewall and potentially over multiple physical clouds, integration must carefully handle information security and privacy.
The Importance of integration i.e. cloud-to-cloud and cloud-to-on-premise
Point solutions overlook the value of interrelations and synergies among other solution domains. For example, a CRM solution targets supporting sales process and the sales people. Travel to meeting customers is in many cases an essential part of the sales process. For the sales person, having Travel and Expense solution embedded to the CRM processes, supporting travel planning for customer visits, as well as expense reporting, could be of high value. For the head of sales department, it will provide a comprehensive view over the cost of an opportunity gathering the various cost associated. This very simple example illustrates the power of combining point solutions to holistic solution that accompany the sales process end-to-end.
Two more advanced examples include: Integrating company’s central Business Intelligence (BI) information with a point solution like Talent management to support insight-to-action; Supporting end-to-end business process, by enabling navigation from the customer information managed at the CRM point solution side into the fulfillment and payment information for that same customer.
Integrating cloud-to-cloud solutions
Obviously all cloud solutions support standard web interfaces. Those interfaces alone are analogous to bridges or shuttles connecting islands of organizational silos. Solutions need to be built with the target integration in mind. Otherwise they cannot provide the experience of an integrated solution expected to effectively run a company.
Integrating cloud-to-on-premise solutions
Most companies are expected to base their solution landscape on hybrid model, combining the best out of cloud solutions along with on-premise solutions. Users will expect to get comprehensive services that will seamlessly overcome the barriers of the two deployment models.
On-premise and cloud solutions are different in nature, and have different life cycle. On-premise solutions are more static. They typically have annual or bi-annual release cycles and customers upgrade on their own pace. Whereas cloud solutions typically have quarterly or semi-annual release cycle and all tenants are upgraded together.
Unleash the opportunity to establish cross enterprises business network
Cross-enterprise integration dimension has not been explored yet. But it introduces a very powerful opportunity that is expected to even influence the way that multi-tenancy is defined.
Cloud service, by its definition, brings different companies’ information together sharing same semantics. A new set of business opportunities can be opened when leveraging the power of the network. It will allow to dynamically establishing business networks to improve business results as well as harnessing the collective intelligence of the network members.
As an example, the world of SCM is already operating across companies, and is striving to simplify the engagement process. Modern production plans are derived by actual demand information provided by the retailers, at some cases at the store/shelf level. Access to this information allows manufacturers to reduce inventory levels and save cost, and not less important minimize out-of-stock situation that directly influences the top line and consumers’ loyalty. One more example is in the area of Benchmarking. Having information about sales for a product line versus the general index for same product line in the market, will improve decision making and business results.
The current generation of cloud solutions delivers already a significant value. It is expected to gradually be replaced by solutions that are designed for seamless integration across the three dimensions of: among cloud solutions; cloud and on-premise; and the most advanced integration across companies.