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Data Integration – Yes, You Can Afford It

Published
  • September 10 2002, 1:00am EDT

There’s no escaping it; data integration is a major issue. On the upside, companies are increasingly aware that they need to engage in an integration exercise. On the downside, they’re often intimidated by spiraling costs. Integrating disparate data stores typically involves big price tags. The good news? Data integration is more affordable than ever before.

Most companies today are unable to respond quickly enough to new opportunities and to take advantage of gaps in the market with new products. Effectively integrating disparate data sources, whether internally or through an M&A process, is crucial to sustaining a company’s livelihood.

The faster a company can adapt its data, the faster it will be able to adapt to new market challenges. Also, having an accurate understanding of its own underlying business data can help businesses prepare a more proactive approach to impending business challenges, rather than constantly reacting to problems as they emerge.

Achieving this requires accurate and accessible customer data, which in turn demands that disparate data stores are tightly integrated. However, data integration, usually assisted by extract, transform and load (ETL) software tools, typically has a price tag that causes most accountants to balk in shock.

From Intuitive to Informed

Data integration, or ETL, is a process that links and matches a company’s disparate data sources, no matter what database, platform or legacy system they are stored in. Properly integrated data provides a company with a single consistent view of its information, empowering it to make informed business decisions, rather than relying on intuition.

The industry for these tools is growing every year; Gartner predicts that it will hit about $600 million in 2005. While most of this will be made up of big name, big price players, the most exciting growth comes from the lower-cost segment. In these economic climates, an increasing number of large enterprises are joining their smaller cousins in seeking affordable yet highly functional tools that can do the same job.

As companies make their way through the shopping list of e-business essentials, such as CRM, e-commerce and ERP, the need for integrated data continues to grow. Gartner calls customer data integration "the backbone of the CRM process," and it plays the same crucial role in synchronizing any of these e-business applications. In fact, a recent Giga Information Group ETL report attributes continued demand for ETL tools to "the diversity, incompatibility and volatility of data sources in the enterprise – ERP, legacy systems, Web logs, XML, message brokers and CRM."1

Seek and You Will Find

However, problems arise trying to access all these information silos in an easy and consistent manner. Contracting teams of data consultants and programmers to hand code gateways into various databases is not only expensive but is also slow and unreliable. Future changes in the chosen technology or database platform not only require new gateways to be developed but also raise the problem of finding capable legacy programmers.

Affordable, new generation ETL tools not only enable companies to integrate disparate data sources but can also provide a visual data modeling function. This allows an organization to easily generate a map or blueprint of its customer information, allowing it to develop its data relationships faster and more effectively. In turn, this reduces new product development time and improves overall time to market.

A common perception is that these tools come attached with large teams of expensive consultants. However, graphical, wizard-driven and easy-to- understand interfaces have lowered the complexity of these programs. This is making it easier for companies to find their own in-house technicians as well as lowering their initial learning curve, which dramatically reduces the overall cost of an integration project.

Aside from the products themselves being more affordable, there is also tremendous value to be derived from improved access to information. Being able to access and use data that is locked up within legacy systems in this way can help extend the return on a company’s original technology investment as well as improve its legacy information access, furthering its competitive advantage.

All these factors – improved product development time and time to market, reduced training and staffing costs, cheaper tools and increased legacy life cycles – contribute toward an improved technology ROI, a necessity in today’s economic climate.

What About Your Business?

Data integration is not an issue that lies solely in the domain of the large, multinational conglomerates. In reality, it is increasingly affecting businesses of all sizes, especially in the mid-market. This is highlighted in the same Giga report where it shows that the ETL market’s strongest growth area is in entry- level integration tools. Data integration should be a concern for any business that does not store all of its customer information in a single repository.

As companies’ IT systems become evermore complex, the need for clear, open access to customer and business data is increasingly essential. By using powerful, yet affordable software to integrate disparate data, companies can turn "dumb data" into an enterprise resource, revitalizing their ability to respond effectively and rapidly to market demands. And they won’t even need to resuscitate their finance department.

References:

1. Source: Giga Information Group. "Market Overview Update: ETL." March 19, 2002.

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