|By Bob Renner||
|February 25, 2014 10:00 AM EST||
Two words that are continually brought up in conversations at company meetings are "integration" and "cloud." According to leading analyst firm Gartner, by 2016 the growth of cloud computing will increase to become the bulk of new IT spend. The relative cost of cloud services as compared to handling integration in-house has historically hindered executives' decisions to implement cloud services and brokers. However, the undeniable benefits to cloud-based integration have now come to the forefront of consideration for C-level decision makers looking to relieve their companies of compliance challenges and security risks, while increasing the speed of data being transferred and analyzed. Putting the two words together, cloud integration is now more important than ever to tackle increasingly complex integration challenges.
As such, 2014 will be a disruptive year for integration providers, cloud services, Big Data and C-level executives looking to take full advantage of what data integration has to offer. Below are three trends companies can expect to see and incorporate into their businesses in the next year:
The Marriage of A2A and B2B Integration
By the end of this year, it is very possible the only people still separating Business-to-Business (B2B) and Application-to-Application (A2A) integration will be software vendors. Integration has historically been separated into the two distinct solutions of B2B and A2A, but as the year continues, we will see these two solution groups merge into one category, known simply as integration. No longer viewed as siloed entities, enterprises will be better able to manage and share information both internally and externally. Heavily influencing this holistic convergence is cloud-based integration. Additionally, the growth of cloud-based integration will continue to act as a fusing structure for evolving integration.
The Bifurcation of the Integration Market
Fueled by the increasing complexity of integration where "data-centric" computing has overtaken "application-centric" architectures, the integration market will bifurcate into two categories: "use case specific" and "use case independent" solutions, the latter of which will focus on the integration technology itself. With the demand for cloud services sold through brokerages expected to reach 20 percent, CSBs are becoming the go-to data-centric strategy for companies looking for an application-agnostic approach spanning across various providers to handle complex integration requirements associated with the growing classes of data generated.
For integration cloud brokers who optimize their offerings for specific "use cases," they will typically work within industries with repetitive implementations and low variation between customers. This model drives the complexity to the end points or the cloud applications. In these cases, providers advocate for common data models or "industry canonicals" with "connect once" marketing messages that entice customers with a simple integration story. However, integration complexity can pose some significant challenges in this market as providers try to address varying integration scenarios with over-simplified solutions.
Looking to the future, the more valuable and sustainable approach will focus on integration providers that embrace variations among customers, developing a core competency to deliver tailored solutions that fit each unique use case. This solution will necessarily yield lower margins, but will ultimately prevent customers from feeling forced to settle for less. This model is a foundational principle of mass customization applied to cloud integration services.
In the end, the two newly created markets will boil down to simple and complex frameworks. As Albert Einstein said it best, "things should be made as simple as possible but not simpler." It's important for both customers and providers to recognize that mass customization offerings, as would be proposed in the second market, are neither a technology nor sales technique, but rather a shift in organizational discipline, which may be difficult for many companies to handle.
Emergence of the Chief Data Officer
In recent years, it seems like a new C-level title is created and en vogue to capitalize on just about every emerging business trend. Some of these positions have more staying power than others. One position, in particular, that will continue to gain legitimacy is the CDO - the chief data officer. Over the past year, companies have become more aware of how data is being analyzed and communicated within their business as well as with partners and customers. Additionally, they have begun to embrace the evolution of data integration and data management to govern new analytics including applications, reporting, planning and social media. This growing emphasis on data management will be the catalyst that propels the CDO from early adopter status to mainstream C-level executive.
In essence, the CDO is the evolution of what most people know as the chief information officer. As with any executive position, the CDO will be faced with various challenges, including the increased complexity of data integration. The CDO's role will expand on the historically internal focus of integration to include external data integration. With 85 percent of respondents to IDC's recent study reporting that IT has become a more valuable partner to their businesses than it was three years ago, today's enterprise has more technology that needs to be integrated within the business. Additionally, the rise of cloud services, cloud application and mobile devices within a company is opening the door for more data, but leaving IT teams with more to manage and integrate.
The increasing presence of CSBs and cloud applications across businesses of all sizes and types is another area of focus that will be guided by the vision of the CDO. With expectations like analyst firm IDC's prediction of $100 billion to be spent on cloud and cloud services alone in 2014, CDOs will need to oversee both external customer and internal cloud implementations, solutions and services. Within this cloud framework, CDOs will be responsible for evaluating, designing and implementing cloud security that is compatible with compliance and integration efforts. As mentioned earlier, with the trend of working with CSBs on the rise, the need for more requirements, security and management will be necessary more than ever.
Last, according to IDC, the global Big Data technology and services market is expected to grow at a 31.7 percent compound annual growth rate. By 2016, it will reach $23.8 billion. With Big Data integration projects on the rise, companies will take advantage of opportunities to build out specific Big Data focused teams to complement solutions and address increasingly complex Big Data challenges. Leading these teams as well as overseeing internal Big Data issues and management, CDOs will be able to support their company as well as customers.
In the end, 2014 will be a dynamically shifting year for IT and the business leadership structure. With increased investments in cloud and cloud services, enterprises will be forced to take a serious look at data integration and management in the cloud to leverage the most effective solution that meets the needs and demands of each specific use case. To create and support this growing demand, the emergence of the chief data officer will be viewed as a necessary component to help champion these changes and provide the vision companies need to succeed. Ultimately, CDOs will be among the prominent new generation of leaders and change-makers who will aid in the growth and prosperity of current and prospective businesses.