Intranet Journal
The online resource for intranet professionals
At the start of the year online magazine "Business 2.0" (www.business2.com) listed software and integration costs for a comprehensive e-business site, including application integration, sales integration, supply chain integration and inclusion of finance and fulfillment, under the heading "The Big Integrations". According to this, between 300,000 and 1.5 million dollars will have to be shelled out for application integration, between 300,000 and 500,000 dollars for sales integration, between one million and three million dollars for supply chain integration, around 100,000 dollars to include Finance and between 250,000 and 450,000 dollars to tie in fulfillment. In the worst-case scenario, a company could face a bill totaling 5.5 million dollars, to be ascribed to integration alone. These costs do not take account of TCO (Total Cost of Ownership) that, over the years, may account for many times the start-up costs.
If in your ROI considerations you have assumed, for instance, that the process costs incurred in e-business procurement can be passed on to the customer, you will quickly learn otherwise; because the customer has had to pay nothing for his order in the past, he will probably not want to make use of e-procurement opportunities at all. Savings that have been included in the calculations do not materialize and ROI will not get off the ground.
Dangerously the sense and advantage of such expensive integration, as listed by Business 2.0, is taken for granted. David Nüscheler, CTO at Day, has most recently made clear that doubt can be cast on this. "The use of products to automate business processes is simply an expensive attempt to link systems at process level. If processes are to be truly transparent, their dependency upon applications must be eliminated and the focus must be on the content within the applications." This point of view makes it clear that it is access to information that is important, not access to applications.
The fashion for content management has caused Forrester Research to compare nine products from content management manufacturers in a so-called "tech ranking". The results, published this Spring, revealed that most content management systems could cope with web site administration, but some exhibited catastrophic deficiencies, however, when performing access to databases, ERP applications, workflow systems, e-mail systems etc.
Ultimately it's not just about straightforward integration of applications, but integration of information, or content respectively, that is stored in the most widely varying applications, and it's about the challenge of operating real "Enterprise Content Management". Only then do Enterprise Information Portals fulfill their purpose. Only those members of the IT community who have fed some fool or other a "total integration" costing millions of dollars will be troubled by the fact that this goal can be achieved already using the latest generation of content management software, that in fact should already be classed as "infrastructure software".
Much to the IT industry's chagrin, however, this ROI-immune species is, unfortunately, dying out. The sarcastic comment by Steve Milunovich, Senior Technology Strategist with Merrill Lynch, regarding ever-decreasing IT investment was: "This year CIOs are being paid to spend nothing."