By Graham Frost, Managing Director for Northern Europe, InterSystems
Despite conflicting views regarding the current performance of the global economy, the recent difficult times that businesses across the globe have faced have caused a number of permanent changes within the IT sector. Chief amongst these is a much greater focus on Return on Investment (ROI) and the benefits that technology will deliver. A disillusionment with ‘IT for IT’s sake’ has developed in many quarters. This was most significantly marked by the publication of “Does IT Matter?” by Nicholas Carr, author of the infamous Harvard Business Review article in 2003.
An even more onerous task, that of deriving ROSI or return on sunk investment from assets, is now being put upon those involved in IT too. Businesses want to use existing information and applications to build and develop new systems that will address new business initiatives and enable the organisation to grow, without ripping out the technology already in place.
So, despite the new rise in IT spending, ROI and ROSI, whether through cost savings or productivity increases, will continue to be the benchmark that sets vendors of technology products and services apart. This means that while organisations will still want to implement and work with companies that provide innovative solutions, they now also need to ensure that the systems they implement can demonstrate and provide clear business advantages that take into consideration previous investments.
Of course if sounds obvious, but one of the key ways for organisations to achieve Return on Sunk Investment is to work with companies and technologies that focus on maximising the technology that exists within the business – i.e., that has already been implemented and is already running at the heart of the organisation.
Typically, a business will already have a number of disparate and incumbent databases and information sources in place – for example an ERP system, a CRM solution, and an HR and payroll function. However the problem is that they are disparate – the data and information contained within them is not integrated and can’t be used to generate knowledge on the organisation as a whole, thus enabling it to improve its processes, productivity and customer services for example, and ultimately evolve and grow.
This is where integration technologies fit in. In essence, they can help businesses unify and integrate back-end data stores to turn disparate data into knowledge. They enable businesses to synch up and harmonise their sunk investments in IT systems to make the information on all of them more accessible and meaningful to the relevant people, without the need for ‘rip and replace’. Literally ripping out old technology to replace it with new can be extremely costly and risky, therefore seriously unpopular with shareholders and the Board.
The integration approach also has some serious risk management advantages that should be taken into consideration when thinking about how it can provide RoSI. The incumbent databases as described above will generally be in place for good reason – they will have been an integral part of the enterprise for a number of years, and developers will be well-versed on how they function and the benefits they can bring. The databases will also have been tested over a number of years, so will be reliable. This means that by integrating rather than removing them, customer data will be retained within the organisation and customer satisfaction levels maintained at all times. In addition, with such an approach, in the worse case scenario, if something were to go wrong, the teams would at least be able to address the issue in a timely and effective manner thanks to their long-standing experience of working with the existing systems – something they would not immediately be able to do with a new implementation.
In short, implementing overlaying integration technologies means that businesses can be in line with the reality of the IT systems and strategies that are already in place. By providing a virtual view over all databases and enabling decision-makers to access the information they need without having to rip out their previous IT investments clearly represents a compelling argument for anyone looking at maximising and improving their business processes and generating a return on their existing investments.
There are also softer issues, however, to take into consideration when looking at ensuring return on investments already sunk into IT. From an organizational perspective, implementing integration technology makes information available in a way it wasn’t before, and to a greater number of people. In addition, greater automation can take place with regards to more efficient work flow between the disparate systems. Clearly the benefits of this are huge – integration can bring operational efficiency and economies of scale, the entire business process becomes more transparent, and issues can be addressed in near real-time by the incorporation of Business Activity Monitoring.
However such developments do engender cultural change, as different departments and business silos will be brought together to work in different and more integrated ways. This means that having a change management programme in place – or at least an understanding that there will be softer issues involved – can help ensure that transition is smooth and that the business benefits and returns are derived from day one.
This softer issue also entails one other business-critical area that must not be omitted when implementing integration technologies – access and security. Clearly, it is imperative to ensure that the overlying software pulling the data together has the capability to dictate who can do what with it, and where and when. When implementing a portal-type application that makes information available, clearly the business needs to ensure, for example, that the HR and finance director can access information on salaries, but that the sales teams can’t – but that everyone can access members of the sales teams’ biographies. Clearly a highly resilient, in-built security component needs to be factored into the solution.
Which brings us to the question of what integration technology to implement and who to work with to do this? There are some key points to bear in mind. Very simply put, the purpose of integration technologies is to reduce business complexity. However in the process of doing this, some solutions can in fact add their own layers of complexity, so selecting solutions from the myriad options available can be difficult. It is therefore important to study the benefits and complexities of rival solutions versus what the organisation wants and needs, rather than being won over by the lure of certain brands or technologies, in order to ensure success and ultimately provide both return on investment and return on existing assets.
At InterSystems, we believe in working with our customers as trusted partners. We develop proof of concepts before asking anyone to sign on the dotted line, and always work in collaboration. In addition, we strive for continuous improvements in performance, productivity, and operational efficiency in partnership with our customers by discussing with then the ROSI objectives before the project begins.
But above and beyond this, whatever the technology route taken or partner chosen, it is imperative that both parties understand the company’s strategic goals and the business processes that the integration effort is trying to get to grips with in order to achieve the returns that the project is hoping to generate.
About the Author
Graham Frost joined InterSystems in 2002, bringing extensive worldwide experience of the hardware and software, smart card and professional services industries to his role of managing the UK and certain other Northern European geographies. Formerly president of Tandem Computers Pacific, Frost has also held a range of other senior executive positions across the world including director of global business development of Silicon Graphics, based in California, CEO of Solace, COO of ProtonWorld based in Europe and chairman of Tom Cobb distilling in Sydney, Australia. Over this time, he has built up a considerable knowledge of building both direct and indirect sales channels and business solutions for both back and front office, engineering and virtual commerce applications. Frost holds a degree in computer science from the University of Hertfordshire in the UK and has also studied at Stanford University, California.