Today’s digitally-driven businesses intensify the data integration challenges that IT departments face. With a greater number of SaaS and on-premises applications, machine data, and mobile apps, we are seeing the rise of complex value-chain ecosystems that are proliferating to support these digital business initiatives. IT leaders need to incorporate a portfolio-based approach and combine cloud and on-premises deployment models in order to sustain a competitive advantage. Improving the scale and flexibility of data integration in the cloud is necessary to provide the right data to the right people at the right time.
Over time, the definition of hybrid integration has changed frequently—ranging from integrating mission-critical on-premises apps with SaaS apps, or B2B data sources from partners and suppliers presented as a mashup in a portal, to integrating big data and backend systems in order to present the data via mobile applications. The evolution of hybrid integration approaches creates requirements and opportunities for converging application and data integration. As time goes on, the definition of hybrid integration will continue to morph, but what's important to realize is that eventually, everything will move to the cloud. In fact, according to IDC, cloud IT infrastructure spending will grow at a compound annual growth rate (CAGR) of 15.6 percent each year between now and 2019 at which point it will reach $54.6 billion, accounting for 46.5 percent of the total spending on IT infrastructure. This technology evolution will drive inherent synergies between data and application integration as a unified and pervasive set of disciplines. This being the case, customers should realize how to advance their hybrid integration strategy so that they are well positioned to leverage the power of the cloud.
Let’s now examine the five phases of hybrid integration, starting from one of the oldest and most mature phases to some of the more recent, bleeding edge, disruptive scenarios. We’ll look at the first two phases of hybrid integration and cover the remaining three phases in the second installment of this blog. You can easily assess for yourself which phase of hybrid integration you’re in, and identify how you can propel yourself to a more advanced phase.
Phase 1: Replicating SaaS Apps to On-Premise Databases
The very first step in developing a hybrid integration platform is to replicate SaaS applications to on-premises databases. Companies in this stage are doing one of two things:
1. They need analytics on some of the business-critical information contained in their SaaS apps; or
2. They are sending SaaS data to a staging database so that it can be picked up by other on-premise apps.
This hybrid integration scenario has been around for several years, and first started when SaaS apps such as Salesforce really started growing in leaps and bounds. However, in order to increase the scalability of your infrastructure, it’s best to actually move to a cloud-based data warehouse service within AWS, Azure, or Google Cloud. The scalability of these cloud-based services means that you don't need to spend cycles refining and tuning the databases. Additionally, you get all the benefits of utility-based pricing. With SaaS apps generating more data, you will also need to adopt a cloud analytics solution such as Tableau or Wave as part of your hybrid integration strategy.
Phase 2: Integrating SaaS Apps directly with on-premises apps
Each line of business within an organization has their preferred SaaS app of choice: Sales departments have Salesforce, Marketing has Marketo, HR has Workday, and Finance has NetSuite
However, these SaaS apps still need to connect to a back-office ERP on-premises system.
Due to the complexity of back-office systems, there isn't yet a widespread SaaS solution that can serve as a replacement for ERP systems such as SAP R/3 and Oracle EBS. In fact, SAP and Oracle are still in the early stages of on-boarding customers to their own pure-play cloud ERP platforms. My advice here is to not "boil the ocean" by trying to integrate with every single object and table in these back-office systems – but rather to accomplish a few use cases really well so that your business can continue running, while also experiencing the benefits of agility afforded by the cloud. For SAP and Oracle ERP environments, you should quickly accomplish the following use cases: Account Synch, Product Synch, and Opportunity-to-Order when integrating with your Salesforce application. Make sure the Service Cloud module within Salesforce also synchronizes with the Products information within SAP or Oracle so that you can track returns of products, as well as customer satisfaction. Also, to lower operating costs while expanding your business faster, consider having a 2-tiered ERP deployment where your corporate headquarters run SAP or Oracle, and your subsidiaries run NetSuite.
In part two of this blog, we’ll look at some of the more advanced phases of hybrid integration that customers are deploying within their enterprise.