With the fast-paced merger and acquisition activity in today’s business environment, a CIO could wind up being responsible for maintaining multiple enterprise resource planning systems and making them all work together.
Unlike a strategist, who could coordinate a best-of-breed strategy from ground zero, managers in this situation may have to integrate two disparate applications.
“Historically, applications haven’t been built so that they would be accessed by another application,” said Ross Altman, group research director for Gartner. (TechRepublic is an independent subsidiary of Gartner, an IT consultancy based in Stamford, CT.)
In addition to application design inadequacy, enterprises faced with integration issues must also build the architecture that will move data in a reliable, systematic, and manageable way from the broker to the hub, allowing the integration of the two systems. Here’s a look at some of the other challenges that CIOs and managers dealing with this problem will need to address.
Short-term plan: Stick to the basics
To meet short-term goals, senior IT strategists will need to ensure that basic business processes, such as passing financial information, continue to function, according to Sharon Ward, director for enterprise business applications at Hurwitz Group, an IT consultancy.
“For example, if the company’s goal is to simply be able to produce consolidated financial reporting, that can be a very simple interface,” Ward said. “In that case, an extract from one system, a map or conversion to the parent's general ledger account structure, and an import to the parent company's system or even a spreadsheet may fill the need completely.”
In any case, Ward suggests that the IT executive first determine which system will be the consolidating system and which will be the "feeder" system.
Ask these upgrade questions when maintaining disparate applications
- · How will upgrades affect the current interfaces?
- · How will database upgrades be deployed when applications may support different versions?
A more complicated scenario
If the systems have to share operational data, simply establishing a “feeder” system will ensure continuity in the business process, Ward said.
“It gets more complicated if the two companies will need to share operational information or centralized services, such as accounts payable, billing, or worse yet, manufacturing or inventory,” she said.
The next step for CIOs is to determine whether the information is critical to share in near real time or if a less-frequent batch update will fill the need.
“For inventory or manufacturing, near real time is probably necessary, but accounts payable may be adequately handled by daily updates,” she said. “In either case, detailed mapping of the data structures of the disparate systems will be required.”
Don’t depend on the vendors for integration tools
If integrating the applications becomes necessary, don’t count on the ERP vendors to provide you with the tools to integrate their application with another.
“What they [vendors] do is create wrappers—a piece of executable code that enables the applications to communicate—for their own internal code,” Altman said. “For example, SAP doesn’t necessarily publish APIs [application program interfaces], but they have found that it is useful to offer customers APIs, so they [SAP] have a partner, Actional Technology.”
Actional’s product—Actional Control Broker for R/3—allows R/3 to be implemented with non-SAP products and allows BAPIs (business application program interfaces) to function as if they were COM components, CORBA objects, or Enterprise Java Beans. (BAPIs are application interfaces for R/3, which enable third-party developers to create software add-ons that interact with R/3.)
Make sure your vendor understands your business
Make sure the application integration vendor has expertise with not only the ERP systems to be integrated but also with your business processes, Ward said.
“This can be vital in deciding on the frequency and type of interface, [and it will] help to ensure that the interface hits all the touch points for a business process,” she said. “In addition, check some examples of the documentation provided to previous customers. [Accurate documentation] will be important in ensuring that the integration meets the business needs but will be crucial in the future as the systems go through their respective upgrades.”