Integration as a Strategic Imperative – Part 1: Introduction
In the past few months, COVID-19 has dramatically transformed everyday life—from the way we interact with others to the new normal of running a business in a disrupted economy. These changes have pushed self-empowerment to the forefront of customer experiences and exponentially accelerated the need for organizations, of all sizes and across all industries, to fundamentally rethink their business models to succeed in today’s new normal.
The repercussions of the pandemic have already fast-tracked a digital approach to business, but intelligent enterprises must go further by evolving their entire business with a complete digital transformation in order to confront the challenges and opportunities ahead.
While the scope and definition of a digital transformation is in the eye of the beholder, a deliberate, strategic embracement of integration is a consistent element of every intelligent transformation process. In other words, an intelligent enterprise is an integrated enterprise. Working closely with a wide range of customers in different sectors and regions over the years, I have witnessed firsthand how essential integration is to every aspect of a thriving intelligent enterprise: growth, innovation, agility, and scalability. A recent study by TBRI finds that the vast majority of organizations feel that integration adds a high level of value to their business.
Let’s take Harrods’ new approach to servicing customers digitally through a high-end online fashion marketplace as an example. To reduce complexity and maintenance requirements while managing a sharp increase in usage, Harrods knew they needed to replace legacy integration elements with a simplified, flexible cloud-based approach.
By adopting an integration best-practices approach to their digitalized business, Harrods has ensured tight connectivity across partner and internal systems with standardized integration for third party applications through a searchable, published set of APIs. The results have been dramatic for Harrods. The organization’s new integration platform—up and running in less than 3 months—handles 3 million transactions per week involving over 100 integration flows (iflows) and is managed by a lean team of 4 integration specialists.
While its critical importance is not lost on most organizations, integration persists as an undervalued strategic business priority in today’s data-rich, hybrid landscapes that are increasingly heterogenous and, all too often, siloed. Many organizations find themselves on the back foot when it comes to integration, exacerbating the issue with reactive, ad hoc efforts.
In a recent ASUG study on integration sponsored by SAP, customers often cite integration as important but place it lower down the pecking order of revenue generating initiatives. Organizations must wake up to the outsized role integration plays within the business. If not, integration will be viewed as a tactical technology that, if left unattended, has the potential to drain business performance with traditional point-to-point integration approaches that are often time-consuming, limited in scope and that create potential for redundancy and increased costs.
The need for more tightly integrated platforms is manifesting itself in various ways and across various industries and lines of business, as outlined in a recent PWC Survey. 44% of corporate financial officers are considering more automation in response to coronavirus issues—with successful automation reliant on seamless integration across organizations. Retailers are looking more closely at integrated payment solutions that facilitate easier purchasing experiences for their customers across brick and mortar and online sales. HR executives are seeking tighter integration of their pre-hire tooling in response to unprecedented levels of remote workers.
So how can organizations best tackle these intensifying integration challenges and adopt a broader, more strategic approach to integration? One that ensures seamless business operations, drives data insights and unlocks innovation?
Executive Support for Integration
Establishing integration as the baseline for any digital transformation requires executive support. A Chief Data Officer, virtually unheard of several years ago, is now a commonplace role within organizations, which gives weight to a thought provoking idea: why not create a Chief Integration Officer role? Or at the very least establish an integration Center of Excellence (CoE)?
Companies I know, like Bacardi, Endress & Hauser and Delaware Consulting have established an integration CoE that has leveraged an agile and flexible approach to connecting applications, data, processes, users and sensors through standardized integration pathways and protocols. A successful integration CoE will implement best practices, avoid known pitfalls, give internal and external stakeholders quick, easy and secure access to data and business logic and facilitate shared IT resources (such as architect and developer roles) to ensure unified access to all vital company data and business logic.
Like many companies in today’s economy, Bacardi’s IT landscape was becoming increasingly heterogeneous, with a mix of on-premise and cloud solutions contributing to integration complexity at an all-time high. To succeed in the ongoing delivery of simple, connected digital experiences to customers, partners, and employees, Bacardi recognized the need to adopt a strategic, ‘building block’ approach to integration. Using accelerators such as harmonized APIs helps Bacardi leverage legacy on-premise solutions with user-friendly cloud-based applications to empower field personnel with more effective daily work schedules. This leads to better customer service and, ultimately, happier customers.
Bacardi has unified their products with seamless end-to-end global business processes and now has one integrated entry point which drives sales efficiency and benefits their business. IT is able to leverage and implement new competencies faster, solving complex integration scenarios with a secure and agile cloud approach that presently includes over 1200 iflows. Adopting a strategic approach has significantly increased Bacardi’s integration delivery speed and enabled an agile approach to development that brings business initiatives to fruition.
Five Key Integration Imperatives
While the value of an integration CoE and the executive support of a ‘Chief Integration Officer’ is not in dispute, creating a strategy for successful integration as the foundation for an organization’s digital transformation ultimately relies on established imperatives. In fact, Deloitte and SAP have recently written a thought provoking article on how an organization’s strategic approach to integration is predicated on the following 5 fundamental imperatives:
- a strategic platform based approach: to establish best-practices and improve KPIs around delivery, efficiencies and business objectives
- reusable building blocks to help internal stakeholders leverage integration platform capabilities with ease and enable architectural compatibility to ensure agility and scalability
- integration democratization (self-service): to enable integration COEs to meet the ever increasing demands for services and capabilities
- smart integration lifecycles: to manage the ever increasing heterogeneity and diversity operating systems within an organization’s technical landscape
- analytics: to better understand internal integration usage, to predict business needs for data and to support progressive business models
Over the course of this Integration as a Strategic Imperative blog series, my colleagues and I will walk you through each of the key integration imperatives listed above and share how customers have successfully embraced each one to meet their integration challenges.
So please join my colleague Dan Kearnan for the second blog post in this series that takes an in-depth look at how a platform approach to integration can help your organization get ahead of today’s disrupted economy.
Integration as a Strategic Imperative Blog Series
This blog post is the first in a series focusing on the strategic importance of integration.
Great blog, it reminded me of my old statement "Strategy First" and importance of C-Level led integration strategy https://blogs.sap.com/2019/02/08/it-is-not-cloud-first-or-api-first-but-strategy-first-api-management-strategy-in-multicloud-environments/?update=updated