Integration costs still hamper agility: survey

If application integration remains the last bastion of business agility, IT managers and CIOs are laying the blame squarely on the high cost of software and services for the slow pace of improvement in 2005.

In a survey of 100 CIOs and IT managers from 84 Australian companies by software vendor Intersystems, 67 percent answered 'yes' to whether strategic integration projects have been held back due to excessive software and services costs. The perceived high cost of both software and services are similar at 52 and 48 percent, respectively.

Conducted at last year's SEARCC conference in Sydney, the survey also revealed that 67 percent of most recently completed projects delivered the target ROI, up from 54 percent in the previous year.

Salvation Army IT manager Larry Reed, a participant in the survey, agreed that integration is inhibited by cost, particularly services.

"We get good value out of software because we do due diligence first, but services tend to be significantly more expensive than we expect," Reed told Computerworld. "Integration of applications is a significant strategic direction that is inhibited by cost."

The Salvation Army has a number of applications - like property management, finance, HR, and helpdesk - that Reed would like to see integrated to streamline business processes and improve productivity.

"We haven't ventured too far into integration at this point [but] we have a number of siloed applications which really need integration," Reed said. "It's just clunky the way things work. If you have disparate apps and have to move data manually you don't get that flow of information to the user and productivity is not as good."

Reed believes the integration problem will "absolutely" get worse before it gets better, because it is "in the early days" with a "significant backlog".

One positive has been the rise of Web-based applications which, according to Reed has helped integration.

"Components of traditional applications have been Web-enabled [and] of our enterprise apps probably half would be Web-enabled at this point," he said.

The Salvation Army's IT strategies are decided annually and Reed is hopeful the organization will move into integration projects this year.

"If the business case is there we can get the funds to do the job and we would know up front what it would be," he said. "Users are expecting more from IT; IT is not just an application that you run on your desktop. It's a business process and users expect to see a seamless flow of information to them. The user is driving integration."

InterSystems' Australia managing director, Denis Tebbutt, said even if organizations like the Salvation Army haven't integrated their applications, they are not "behind the eight-ball".

"New technology provides the opportunity to put business processes first," Tebbutt said. "This design resides in heads of people in the organization."

Tebbutt said engaging in a proof-of-concept will allow an organization to see an expected ROI for an integration project and IT to respond to the change in a timely manner.

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