February 8th, 2021
Remember back in 2010 when Apple trademarked the phrase “There’s an app for that”? Well, over one decade later, there are a lot more apps for “that.” Technically speaking, and in line with the legalities of the phrase, the App Store has significantly grown in size. From a technology perspective, business applications, systems, software, and solutions in general, have exploded to the point that it’s hard to keep up.
If only it were as simple as browsing an all-inclusive marketplace—one that’s specifically tailored to your business needs—and pressing ‘Get’ so that the application (or whatever else) is seamlessly installed and ready for use. This would eliminate 99.9% of the integration-related complications businesses are facing today. Realistically speaking, that’s a far-fetched dream. Instead, businesses are in a constant position of playing catch-up, continuously confronted with new technology to add to their already toppling stack. Even more, the XaaS (Anything as a Service) model is locking businesses into an increasing number of monthly contracts, all of which must be regularly evaluated to make room for bigger and better things.
Want to skip ahead to the conclusion? Start reading from The Future of Integration
Building Your Technology Stack
Every business has to begin somewhere, and that starting point is typically the foundation that dictates all major IT initiatives moving forward. In other words, every business has a core (or multiple cores), which is more often than not an Enterprise Resource Planning (ERP) system. But as a standalone investment, a core system will never support all business-critical activities out-of-the-box. Instead, it has to be enriched with both internal and external applications and additional (often third-party) software. This creates a whole web of disparate systems and scattered data.
That’s where integration comes into play—but we’ll get to that later. First off, there’s a long list of solutions that, like an ERP system, have the sole purpose of managing day-to-day business processes. The thing is, everyday tasks vary greatly from one business to another. Thus, the solutions available in the market today reflect a broad range of business needs. So aside from an ERP, which solution(s) do you need?
Here’s a list of common back-end systems and a brief explanation of each:
A Content Management System (CMS) is a type of application that simplifies the creation, modification, and publication of web-based content. On its own, a CMS application can serve as the foundation of a website. It can also complement other systems by providing an easy-to-use feature to manage content within an existing system.
CMS Examples: WordPress, Drupal, Magneto
Gartner defines Customer Communication Management (CCM) as “the strategy to improve the creation, delivery, storage and retrieval of outbound communications, including those for marketing, new product introductions, renewal notifications, claims correspondence and documentation, and bill and payment notifications.” CCM software serves the purpose of realizing this strategy.
CCM Software Examples: Adobe Experience Manager (AEM), Quadient Inspire, OpenText Exstream
A Customer Relationship Management (CRM) system is used to keep track of all interactions with existing and potential customers. This is most often used by sales to prospect new accounts and organize all related communication.
CRM System Examples: Salesforce, HubSpot CRM, Pipedrive
A Document Management System (DMS) provides capture services and central storage for all business documents (paper and digital). A Document Management System enables search and retrieve functions and can provide additional document security.
DMS Examples: Wrike, Confluence by Atlassian, Nintext Process Platform
Electronic Data Interchange (EDI) software primarily serves the purpose of enabling the exchange of business data (e.g. purchase orders and invoices) from one system to another. EDI software is most often a complementary back-end solution that ensures accurate data translation and trading partner mapping to automate procure-to-pay and order-to-cash processes, all while providing detailed analytics for document exchange.
EDI Software Example: TIE Kinetix
The main purpose of an Enterprise Resource Planning (ERP) system is to aggregate all core business data into a single location. It consists of various applications, or modules, each of which typically meet a particular business need. This may include specific applications for HR, finance, logistics, retail, sales, or virtually any other business area that requires visibility.
ERP System Examples: Microsoft Dynamics 365, Microsoft Dynamics AX, Oracle, SAP, Sage X3, Exact
A Human Resources Management (HRM) system enables a company to manage human resources activities. This includes everything from maintaining employee records to identifying trends regarding internal behavior. HRM System
Examples: Oracle Fusion, Workday, ADP Vantage HCM
Any business that has partners that market and/or sell their products and/or solutions will typically have a Partner Relationship Management (PRM) strategy in place. This may be supported with one or more PRM solutions that aim to streamline co-marketing efforts.
PRM Solution Examples: Impartner, PartnerStack, ZINFI, Zift Solutions, Allbound PRM
A Transportation Management System (TMS) is used in logistics to manage the movement of goods, both coming and going. This type of system provides useful shipping-related data, including relevant trade documentation, and is typically used in combination with other supply chain management (SCM) systems, such as electronic data interchange (EDI).
TMS Examples: Oracle Transportation Management, SAP Transportation and Logistics System
A Warehouse Management System (WMS) is solely used to manage daily warehouse operations. This system provides valuable insight on everything that moves in and out of company warehouses— from raw materials to finished products—for optimal inventory control and forecasting.
WMS Examples: Oracle Warehouse Management Cloud, SAP Extended Warehouse Management
As you can see, there are a lot of interrelated solutions that perform similar, often overlapping tasks depending on the business scenario. That’s why most businesses operate using a combination of the solutions listed above. It gets even more complicated with large companies and SMEs that have location-specific requirements and/or preferences, because then it’s not as simple as having a company-wide ERP system, or a company-wide WMS.
You get what we’re trying to say—it’s very easy for a single company to add to their technology stack. And food for thought, we haven’t even touched the surface on business applications and other third-party services, like marketing automation platforms and, quite literally, any other web-based service that requires a monthly payment.
Whether it’s an ERP, CRM, WMS, or any other back-end software, application, system, or solution, chances are, it’s sold as a service. Although on-premise solutions still exist, most forward-thinking companies are migrating their data to the cloud. We’ve already briefly touched on how the XaaS (Anything as a Service) model has infiltrated the tech industry—and for good reason. There are a lot of upsides to this model in terms of flexibility, scalability, and even cost.
However, the fact that anything can replace the “X” in XaaS has caused a bit of confusion in regard to seemingly identical solution offerings being offered as one type of service as opposed to another. For example, TIE Kinetix delivers SaaS solutions for EDI while another company offers an iPaaS solution for EDI. What’s the difference? And can multiple service models be employed simultaneously?
Below you’ll find a list of common, subscription-based service models deployed in the cloud:
AaaS aims to aggregate scattered business data that is stored in the cloud to form a more cohesive reporting environment. This information is typically displayed in custom reports and dashboards.
An Application Platform as a Service (aPaaS) is most often used by developers and non-developers alike to quickly develop and deploy business applications. aPaaS is a subcategory of PaaS (Platform as a Service).
Infrastructure as a Service (IaaS) subscriptions eliminate on-premise infrastructure investments and upkeep and provide users with a complete computing infrastructure in a multi-cloud environment. Basically, Infrastructure as a Service is a flexible and easily scalable rental service for servers and cloud storage that is fully managed by the service provider.
Gartner defines Integration Platform as a Service (iPaaS) as “a suite of cloud services enabling development, execution and governance of integration flows connecting any combination of on premises and cloud-based processes, services, applications and data within individual or across multiple organizations.”
Traditional iPaaS is sometimes specified under the Enterprise Integration Platform as a Service (Enterprise iPaaS) category. The iPaaS definition above also applies here but becomes specific to enterprise integration scenarios. You can find a more thorough explanation of iPaaS, including its benefits and how to best approach systems integration with an iPaaS solution here.
Platform as a Service (PaaS) solutions provide a basic framework for developers to create and deploy both cloud-based and cloud-enabled applications. Platform as a Service is an extension of IaaS and enables additional, cost-effective development capabilities and application lifecycle management.
Software as a Service (SaaS) solutions include everything that comprises both Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) solutions. The distinguishing factor is that SaaS solutions eliminate in-house development and provide customers with the final, ready-for-use application. This option is by far the most popular service model, as the application is fully managed by the service provider for the agreed upon monthly fee.
Did We Clear Things Up for You?
If your answer is yes, you might want to stop reading now—we don’t want to confuse you all over again. If your answer is no, you might as well keep going. We’re going to have some fun.
Overall, there are a lot of solutions and a lot of service models to keep tabs on. And to add to the confusion, definitions are seemingly melting into one another, making it nearly impossible to perform side-by-side comparisons and truly understand the differences. Can your EDI solution double as a CCM tool? Can it also serve as your CMS? Does the SaaS contract with your EDI provider also give you access to advanced analytics as if it were a AaaS contract? Probably!
You’re Not Alone
These blurred lines are even causing confusion within the tech industry. For example, if you analyze the way in which tech industry reports have evolved over the years, you’ll notice that what may have been referred to as an Integration Brokerage (IB) in 2014 is now referred to by Gartner as a Multienterprise Supply Chain Business Network (MESCBN).
Two things are very interesting here. First, adding to the confusion even more, it’s not common for a service provider to market themselves under any of these categories. For example, many service providers that are designated as top MESCBN providers by Gartner deliver SaaS solutions for EDI. Second, evolving definitions from leading market research firms, like Gartner’s MESCBN category, more accurately describe what these service providers offer—even more so than the individual company’s own marketing tactics (i.e. the corporate website), and even more so than any of the definitions we’ve provided thus far.
The Future of Integration
Our conclusion is that fully integrated, end-to-end XaaS solutions are on the rise. No matter what you call it, companies that are beginning to adopt this strategy (like TIE Kinetix) can offer their customers a more comprehensive solution—one that ultimately eliminates the need to enter into additional service level agreements (SLAs) and face the inevitable integration challenges that come along with them.
Keep in mind that every individual system and application in use within an organization, especially those that may contain duplicate data, must be integrated sooner rather than later. Otherwise, there’s a high risk of encountering competing information that could potentially have a devastating effect on the business. Ideally, with an end-to-end solution, there’s a standard API or pre-built connector for every possible software, system, and/or application integration scenario.
A Word of Advice
The key word above is ideally, because no service provider has reached that point to date and probably won’t for quite some time. As it is, standard system integration solutions are limited. However, you should keep in mind that the technology industry is, in general, moving in that direction. So if you’ve already done more research on back-end systems and integration solutions than you care to admit and still can’t make sense of it all, we’ll offer you some advice in regard to choosing a service provider.
Don’t worry—despite this long, complicated blog post, it’s actually quite simple:
1. Clearly define business needs and know your existing technology stack
Has the solution been right in front of you all along? Engage in regular, open discussions with your existing service providers and you might be surprised; even if they don’t currently offer the solution you’re looking for, they might very well develop it. After all, hearing something directly from a customer is prime market research material!
2. Consider the overall corporate business strategy for every service provider that you evaluate
Ask: Is your potential service provider keeping up with industry-defining trends and proactively forming new partnerships in order to add value to their existing offerings?