Today’s increasingly digital world is providing businesses with new opportunities to create a more personalized customer experience across new channels such as web and mobile.
And with customers coming to expect tailored and seamless shopping experiences from new startups, existing companies are feeling the pressure to deliver.
As businesses rush toward a digital transformation to meet those customer expectations, they are realizing that existing business models and applications are not sufficient. The digital disruptors are launching new business models, and traditional business can’t keep up.
Three main barriers are holding traditional businesses back:
- Scale: Older IT systems like ERPs used by traditional businesses do not scale for digital needs. Digital requires that the systems provide a responsive and consistent experience across all channels that a customer may use. This requires an elastically scalable architecture, which most legacy IT apps do not possess.
- Ecosystem: Digital revenue models do not strive on a single product, but are built on ecosystems that involve hardware and software partners, as well as third-party developers. Older IT systems are not designed to foster complex ecosystems and make it difficult to share internal IT information securely with partners and developers.
- Cloud: IT is undergoing a transformation – traditional IT has been moving pieces of ERP to the cloud – bringing cost efficiencies, but also increasing complexities. Connecting on-premise and cloud apps to provide a seamless experience to digital consumers has become extremely difficult.
It seems like a catch-22 that businesses can’t get rid of all their older IT systems but also can’t afford not to use the newer applications. But businesses are able to overcome the aforementioned challenges by finding the right platforms that support integration – connecting the old and the new.
Hybrid Integration is the Way Forward
Two things are very clear to IT leaders by now: Cloud apps are the future, and on-premise apps are not disappearing overnight.
Hybrid integration is the way to go forward as integration is not merely connecting the back-office systems together. For digital, it actually will be exposing back-office systems to external partners and developers to build an ecosystem for consumers. To expose data and services to external partners securely, a few things need to happen first:
- IT needs a strategy to build, document, test, and expose application programming interfaces (APIs) that the partners can use.
- As APIs will become just another app, their lifecycle needs to be managed. Lack of governance can be risky, as APIs may expose content, customer data, and pricing information to external partners. In the world of the Internet of Things (IoT), they may even expose personal information generated by devices.
- API strategy needs to be part of hybrid integration strategy, not another silo. All systems need to be connected and ready for API-driven interactions with other systems, partners, and developers.
API is the gateway into the application and is used not only for integrating two applications, but also to make better decisions. For example, an order-fulfillment process for an online retailer may invoke several APIs (which includes real-time quotes) from different shippers and, within a millisecond, evaluate the best price to ship a package.
However, this is just the first step is creating value for the end-user. The speed in shipping the package will not help if, for example, the package goes to a wrong address. The data accuracy is a major influencer of customer satisfaction and that is where master data management (MDM) systems come into play.
MDM systems comprise tools that define and manage the critical data within an organization and provide a single point of reference. Ultimately, it helps establish data-governance practices and improve data accuracy across the ecosystem. As businesses increasingly rely on data as a competitive advantage and introduce more technologies that collect data from various endpoints, this simplified access to information is key to making sure business decisions are made on the most up-to-date and accurate information.
We expect to see a few trends around APIs and MDM gain ground as digital transformation makes waves in business:
- The Swagger API framework will become the de facto standard, and initiatives like Open API will further standardize the role of Swagger in API development. Open API helps define a standard, language-agnostic interface that allows both humans and computers to discover and understand the capabilities of the service without requiring access to source code and documentation. It paves the way to sync the consumers of the service with the provider automatically as the API is updated.
- APIs will meet self-service integration as everything is an API and all data is immediately accessible to you and to those you choose. As companies expose more APIs to partners, the goal is for partners to be able to adopt the APIs quickly and easily. Using self-service, partners can learn about the APIs, start using them and then complete the testing and go into production without assistance from the company.
- MDM will look to IoT to incorporate data about customer buying preferences and will link that data to standard MDM data quality processes, such as cleansing and matching. IoT devices produce a lot of data that is usually processed through a filter to get actionable insights. MDM can improve IoT processes by improving data quality and act as a spell-checker for fast-moving data.
- MDM solutions will continue to increase support for business data stewards by simplifying work views, creating more application-oriented interfaces, and integrating business intelligence tools and dashboarding to understand the value and impact of superior data quality on business processes.
Many of today’s businesses are on a mission to become digital enterprises, which means they are shifting how they use business applications. While this transformation won’t happen overnight, companies need to start now if they are looking to get an edge over their competitors. Before we know it, these new API and MDM solutions are going to be a necessity, and not a competitive advantage.
Navdeep Sidhu is Senior Director of Product Marketing at Software AG, he focuses on webMethods Integration platform. Prior to Software AG, he was with Sterling Commerce (now IBM) where he was Senior Product Manager focusing on B2B Gateways and Partner Community Management. Prior to joining Sterling Commerce, he spent over seven years with Deloitte Consulting, managing large-scale application development and integration projects.
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