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Spend on integration to grow: Gartner

By 2016, midsize to large companies will spend 33 percent more on application integrations than in 2013, Gartner predicts.

By Anna Game-Lopata | February 15, 2013

By 2016, midsize to large companies will spend 33 percent more on application integrations than in 2013, supply chain IT research company Gartner predicts.

Gartner’s Predicts 2013 Application Integration report also reveals CIOs and other IT leaders risk becoming enamoured with IT innovation at the expense of basic competencies such as application integration.

“IT leaders worldwide need to refocus more of their attention and IT budgets on this vital IT competency so they can improve their chances of successfully adopting IT innovation,” Gartner says in its analysis.

According to the research, organisations will spend $32 billion just on software as a service (SaaS), by 2016.

“Like on-premises software, SaaS must be integrated, for example, to synchronise orders between salesforce.com and on-premises applications like Oracle and SAP,” the research points out.

“Such integration projects require new skills and technologies to deal with sophisticated cloud application programming interfaces (APIs), which often run into the dozens or hundreds of pages of specifications and mandate a more agile approach to integration driven by the often-stringent, time-to-deployment requirements of SaaS projects.”

Despite the advent of SaaS, the Gartner research
packaged application deployments continue in most user organisations.

“These are driven by the desire to get rid of decade-old legacy applications, technology refresh cycles, consolidation, globalisation and new regulations.

“Each new packaged application deployment or release change project brings the need to develop or re-engineer dozens if not hundreds of interfaces, an effort that is often a major component of the overall project cost.”

The research also
claims the explosion of information being generated, routed and shared
adds integration points and complexity.

For example companies increasingly leverage near-real-time analytics to monitor and drive improvements in essential multi-enterprise business processes.

“In finance analytics are used to support fraud detection and risk management. In retail and manufacturing, analytics support complex replenishment processes, such as cross-docking or vendor-managed inventory (VMI).

“Bio-tech companies track drugs from production to consumption. In aerospace, analytics help enforce supplier and export compliance. The list goes on.

key enabler for analytics is integration — the ability to capture and route relevant business process data and events to various business activity monitoring (BAM) and event-driven architecture (EDA) tools.”

In addition B2B e-commerce is expanding in scope and complexity.

“In the five years ending in 2013, we believe that B2B traffic will increase tenfold, and that by 2016, 50 percent of new integration projects will involve on-premises applications, e-commerce trading partners and cloud services,” Gartner says.

“Factors include increasing process automation, process complexity, demand forecasting and e-invoicing. All this will involve more connections, protocols, data to translate and support for managed file transfers (MFTs).

Finally, the use of mobile applications and social networks such as Facebook, Twitter and LinkedIn offer valuable sources of real-time information to user organisations willing to understand consumers’ desires, collect feedback about their products and services, analyse industry sentiment and look for best talents.

“To be analysed, this mass of information must be extracted from various social networks and other SaaS providers and integrated with business application data, data warehouses and other data sources, further increasing the amount of integration points for organisations.”

Among other recommendations, the Gartner research advises executives adjust their IT budgets to accommodate an increase in the cost of doing more integration over the next five years.

It also suggests businesses prepare for a more agile, distributed and federated organisational model to address the increasingly pervasive nature of integration.

Other findings of the research include:

  • By 2016, the integration of data on mobile devices will represent 20 percent of integration spending.
  • By 2017, over two-thirds of all new integration flows will extend outside the enterprise firewall.
  • By 2018, more than 50% of the cost of implementing 90% of new large systems will be spent on integration.

Download Gartner Predicts 2013 : Application Integration report

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