CEOs’ decisions today to pursue digital-first strategies for greater revenue growth are defining their company’s competitive strengths in the future. CIOs and their teams are being challenged to drive a larger percentage of revenue growth in 2017 than ever before by providing IT-based insights daily.
- Enabling faster revenue growth, improving products and replacing obsolete technologies are the top three CEO priorities have for CIOs in 2017.
- 42% of CIOs say “digital first” is their company’s go-forward strategy for IT investments in 2017 and beyond.
- 33% of CIOs consider revenue growth as their primary metric for measuring success with their digital business strategies.
The New Economics Of Real-Time Integration
IT teams are taking on the challenge by concentrating on those areas that can scale the quickest and deliver measurable revenue results. They’re finding that the integration approaches taken in the past don’t match the speed that customers, sales, suppliers and senior management need today. A key takeaway from CIOs’ initial efforts includes the finding that making small improvements in data latency can increase sales win rates in 90 days or less while improving cost controls. Improving data latency is one of the key factors driving the new economics of real-time integration, which is defined below.
- Integrations’ Inflection Point Has Arrived – Digital-first initiatives for defining new channel, selling and product strategies require more speed than batch-oriented integration can deliver. Customers now expect real-time response across all sales and support channels on a 24/7 basis. The pressure to drive greater revenue through digital channels and deliver a consistently great customer experience are forcing an inflection point of integration technologies today.
- Batch-oriented approaches to integration fit well in an era of transaction-centric IT. Asynchronous, tightly-coupled, and relying on ETL for moving data around an enterprise network, these approaches were better suited for more predictable revenue strategies. In contrast, going after new digital channels is unpredictable and requires real-time integration to deliver excellent customer experiences. Service-oriented frameworks that support synchronous data consumption and have low latency are emerging as a better choice for digital-first revenue strategies. Based on loosely-coupled integration points, these frameworks are capable of quickly adapting to new business requirements. Companies including enosiX are revolutionizing services-oriented frameworks by removing the roadblocks legacy integration approaches created. The following graphic illustrates integrations’ inflection point and how past approaches to integration are giving way to more synchronous, loosely- coupled service-oriented frameworks capable of scaling faster to drive greater revenue.
- And it’s fueling faster development cycles, reducing time-to-market and improving app and web services quality. The apps, web services, and APIs needed to launch a digital-first strategy don’t exist off-the-shelf, ready to be deployed for the majority of companies. Every company needs to create customizations to existing apps and web services, or create entirely new ones to support digital revenue strategies. Availability of real-time data through service-oriented frameworks is revolutionizing how apps, web services, and customizations get built. With real-time data designed in, it’s possible to test new apps across more use cases and ensure higher quality too.
- While also enabling IT teams to exceed stakeholder expectations and their goals for digital-first strategies. Integrations’ inflection point is the most visible in how CIOs are now considered more responsible for revenue than ever before. From the initial revenue strategy definition through project managing apps and web services to delivery and producing revenue, CIOs and their teams who see themselves as business strategists excel in their roles. IT teams and the CIOs who lead them are seeing signs of integration’s inflection point every day. They’re seeing just how urgent the inflection point is, and how it’s redefining the economics of how they orchestrate systems together to attain revenue growth. The insights and expertise CEOs, VPs of Channel Strategy, Marketing, Cloud & IT Infrastructure, and other senior management team members have needed to get quickly translated into apps, web services and digital first strategies that capitalize fast on new opportunities. Only through the use of service-oriented frameworks that can scale to support new revenue processes can any company compete in 2017 and beyond.
The difference between CIOs who lead and those caught in never-ending reactionary cycles is often a strategic IT plan and integration roadmap. It’s the CIOs who take the time to create and pursue an integration roadmap that has the greatest chance of breaking out of always reacting to IT projects and leading them instead. That’s because the majority of inbound requests center on data, reports or analysis only deliverable by integrating two or more systems together.
Five Ways Integration Roadmaps Are Putting CIOs Back In Control
Based on conversations with CIOs across a variety of industries including manufacturing, distribution, aerospace, financial services, and retailing, five factors emerged that led to creating integration roadmaps and getting in control of IT spending and priorities. I’ve summarized these five factors below:
- Integration roadmaps are proving to be an effective catalyst for driving purpose-optimized integration strategies, reducing middleware costs in the process. CIOs who create and continually improve their integration roadmaps are prioritizing purpose-optimized integration strategies to more efficiently scale global operations. Creating real-time integration links between SAP and Salesforce is one example of how CIOs are using purpose-driven integration to reduce customer response times for information, improving customer satisfaction in the process. Enabling real-time, bi-directional data updates without requiring complex middleware coding and mapping of data is a challenging task, and innovative startups including enosiX are excelling in this area today.
- Defining a path for reducing ETL spending and dependence on logs to troubleshoot errors and measure performance.Reducing their dependence on ETL is giving CIOs and their teams much more flexibility in how they manage IT It is also freeing up system analysts to work on new projects instead of troubleshooting integration issues. With no automated error handling or recovery mechanisms, many CIOs are gradually phasing ETL out for more modern integration technologies that eliminate error logs altogether.
- Investing in the latest technologies that enable business process and application logic is making IT more responsive, helping them break out of a bureaucratic reputation. When I asked CIOs about the best way to increase responsiveness to internal customers, they wanted integration technologies capable of scaling across the back office and selling systems to make them more responsive. By having integration technologies that enable business process and application logic, the time-consuming, and often error-filled, the task of enabling new business processes manually goes away. And, when IT can react faster, their bureaucratic reputation is also on the way out too.
- Choosing to reduce and eliminate hand-built adapters and connectors from their IT infrastructures to free up support funds and time on urgent IT project needs today. One large-scale industrial equipment manufacturer has a staff of software developers and engineers who do nothing but keep adapters and connectors written in ABAP running across their ERP, Manufacturing Execution Systems, quality management, and supply chain systems. With production centers in the Midwestern US, China, and Europe, the ABAP team is always busy but never innovating. They are just ‘keeping the lights on.’ Having an integration roadmap is going to get this manufacturer out of the situation they are in today, which is draining dollars and time from IT.
- Move closer to quantifying the value IT delivers by showing how an integration roadmap provides support for cutting maintenance costs, consolidating apps and introducing new platforms. The ROI of IT often hinges on how effective CIOs are at reducing costs and still delivering a median or average level of service. By having a plan in place to attack integration challenges and costs, CIOs can immediately prioritize steps to improve service, reduce costs, and attain department and corporate goals.
Originally published on the enosiX blog, Five Reasons Why Every CIO Needs An Integration Roadmap In 2017.
From the obvious to the outrageous, enterprise software predictions often span a wide spectrum at the beginning of every year.
In enterprise software in general and ERP specifically, there are many safe harbors to dock predictions in, from broad industry consolidation to Oracle buying more companies. Or the inexorable advances of cloud computing and SaaS platforms in ERP today, which is often cited in enterprise software predictions.
Too often predictions gravitate too much towards theoretical economics, overly-simplified industry dynamics and technologies, leaving out the most critical element: customers as people, not just transactions. So instead of repeating what many other industry analysts, observers and pundits have said, I am predicting only the customer side of ERP advances in the next twelve months.
The following are my predictions for ERP systems and enterprise computing in 2013:
- The accelerating, chaotic pace of change driven by customers will force the majority of Fortune 500 companies to reconsider and refine their ERP and enterprise computing strategies. Social, mobile and cloud computing are combining to provide customers with more acuity and articulation of what their preferences, needs and wants are. The majority of ERP systems installed today aren’t designed for managing the growing variation and pace of change in customer requirements and needs. In the next twelve months this trend will force the majority of Fortune 500 companies to re-evaluate their current ERP systems when it becomes clear their existing enterprise systems are getting in the way of attracting new customers and holding onto existing ones.
- Highest-performing CIOs will rejuvenate monolithic, dated ERP systems and make them agile and customer-focused, while at the same time excelling at change management. There are CIOs who can handle these challenging tasks, and the future belongs to those who can fluidly move between them quickly. In twelve months, a group of CIOs will emerge that are doing this, delivering significant gains to gross margins and profitability in their companies as a result. They’re the emerging class of rock stars in IT and enterprise computing.
- Quality ratings of ERP systems by internal customers will become commonplace, including 360-degree feedback on ERP performance. This is overdue in many companies and it takes a courageous CIO and senior management staff to value feedback on how their ERP systems are performing. In the most courageous companies, within twelve months the results of these internal surveys will be posted on bulletin boards in IT and throughout IT services departments. For some companies this will be first time IT staff members have a clear sense of just what internal customers need, how they are being served, and what needs to be done to improve business performance.
- ERP systems built on a strong foundation of personas, or clear definition of customers and their roles, will overtake those built just on features alone. This is already happening and it will accelerate as featured-based ERP systems prove too difficult to be modified to reflect the fast-changing nature of personas and roles in organizations. The quickest way to determine if a given ERP system launching in the next twelve months will succeed or not is asking what personas it is based on and why.
- Customers push speed and responsiveness from a “nice to have” to a “must have” as advances in mobility platforms and integration make real-time possible. If there is one unifying need across the personas of customers an ERP system serves, it is the need to improve responsiveness and speed. The same holds true within enterprises today as well. It would be fascinating to look at the data latency differences between market leaders versus laggards in the airline industry for example. Customers will push accuracy, speed and precision of response up on the enterprise computing agenda of many companies this year. Speed is the new feature.
- What were once considered ERP-based operations bottlenecks will be shown to be lack of customer insight. Take for example the very rapid product lifecycles in retailing. At first glance slower sales are attributed to not having the right mix of products in stores, which is a classic supply chain problem. Yet customer-driven ERP systems will tell retailers a different story, showing how product selection, even suppliers, are no longer pertinent to their customers’ preferences and needs. More customer-centric ERP systems will help retailers overcome costly and difficult to recover from bottlenecks in their operations.
Bottom line: Enterprises clinging to monolithic, inflexible ERP systems need to re-evaluate how their enterprise computing strategies are serving their customers before their competitors do.