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The Enterprise System Spectator

Thursday, August 22, 2002

CIO roundtable report from the trenches. Earlier today, I met with group of about 15 CIOs in southern California in a roundtable meeting to discuss the subject of Web integration with back-end enterprise systems, including the use of enterprise application integration (EAI) technology. As a whole, these companies have made good progress, and the CIOs discussed a number of interesting experiences and issues involving Web development and integration.
  1. Single ERP, or integrate multiple systems? One CIO pointed out that an EAI approach might be most appropriate for large multidivisional companies that need to maintain multiple systems. In many cases, it may make more sense to migrate to a single enterprise system (e.g. SAP, Oracle, J.D. Edwards), thereby lessening the need for integration. On the other hand, over the past few years there have been a number of well-publicized failures with large-scale ERP implementations, and as an alternative CIOs should at least give the case for EAI some consideration.

  2. Contract Web developers or grow your own? The CIOs generally indicated that many Web initiatives simply can't wait for internal staff to be trained in new technologies. Therefore, most of the CIOs are choosing to contract with outside developers, but at the same time they also assign them to mentor internal staff. In this way, the internal staff can maintain and enhance Web applications in the future. However, some CIOs pointed to the limited availability of training options, especially in the case of IBM’s Websphere, as a constraint to training internal staff.

  3. Web-based systems replacing internal systems. One CIO told the story of rolling out a Web-based ordering system for customers, only to find that internal sales users then requested to be put on the same system. Another CIO indicated that his company did a successful roll out of a Web-based ordering system by introducing it first to the sales force. Then, after the new system was refined and accepted by the sales force, it was rolled out to customers.

  4. Does Web services technology make point-to-point integration more appealing? One CIO suggested that web services (i.e. XML and SOAP) can be used to facilitate integration between disparate systems. Although Web services do theoretically lower the cost of maintaining and developing point-to-point interfaces, they do not in themselves provide the overall business process management capability that a full EAI solution offers. Nevertheless, it will be interesting to see how the adoption of Web services affects market demand for more extensive EAI technology.

  5. Security and privacy. Interfacing web applications to internal systems often requires additional measures to protect company or customer confidential information. One CIO pointed out that much good material on this subject can be found on the Web related to the health care industry, which has been addressing issues of security and privacy related to HIPAA regulations.

  6. Cleaning up data and increasing discipline. In some cases, internal data accuracy may appear adequate for internal use, but it is woefully insufficient for customers. Therefore, and companies should clean up the data before making it available for customer inquiry. On the other hand, opening some data to customers may be just what’s needed to force the organization to improve discipline. When one CIO’s company gave customers the ability to check order status via the Web, it put pressure on sales people to confirm promised ship dates, who in turn put pressure on manufacturing to meet schedule dates.

  7. Who pays for EAI? One CIO pointed out that in many companies IT initiatives are paid for by the department that uses or benefits from them. But when an IT infrastructure investment is needed, such as an EAI solution, it is sometimes difficult to get budget approval because it is a shared cost. The high cost of EAI solutions is definitely an obstacle to budget approval. Companies need a way to justify such infrastructure investments for the benefit of all functional groups.

by Frank Scavo, 8/22/2002 02:22:00 PM | permalink | e-mail this!

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Independent analysis of issues and trends in enterprise applications software and the strengths, weaknesses, advantages, and disadvantages of the vendors that provide them.

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