February 21, 2000
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Providers join forces to help businesses link front- and back-end systems
By Larry Greenemeier with Jennifer Mateyaschuk
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ne of the biggest challenges facing E-businesses is integrating front- and back-end systems. Finding the skills, internally or externally, to do that job is difficult. E-services providers are trying to fill the void.Several IT services companies last week moved to help businesses tie together their front- and back-end systems. Cognizant Technology Solutions Corp., a $1 billion offshore outsourcing firm, formed a partnership with Viant Corp., a $61 million provider of Web-integration services. And CMGI Inc., a $175.7 million network of more than 60 Internet companies, unveiled plans to buy 80% of Tallan Inc., a $54 million software development and implementation firm, for $920 million in stock and cash. Also, Cambridge Technology Partners and Acuent Inc. say they're shifting their focus toward E-services because of rising demand from customers that need integration help.
Integrating Web storefronts with back-end systems is critical to E-business success. IT staffs are turning to E-services firms because skills needed for end-to-end systems integration are hard to find, says Jack Weiss, an analyst with Lehman Brothers: "In this industry, it's all about human resources, where you can go to find the people who have these skill sets."
Only about a dozen firms, including AnswerThink, Razorfish, Scient, and US Web/CKS, offer extensive E-business integration services. Consolidation will continue, says Weiss, because businesses want to get Web and back-end implementation expertise from a single source.
Nielsen Media Research Inc., the television rating company in New York, uses Cognizant to integrate data between two IBM S/390 mainframes and a customized Web interface, which Cognizant and smaller E-services companies built. "For our company, our main back-end data is our product," says CIO Kim Ross.
Under its alliance with Viant, Cognizant will manage the integration of Web and back-end legacy systems through the development of middleware; Viant will provide front-end Web design and strategy. Cognizant says about 80% of its customers opt to have it write APIs that let front-end Web apps access data on legacy servers. The rest overhaul their IT infrastructure.
CMGI wants to combine Tallan's expertise in E-business strategy implementation with CMGI's SolutionsPort strategy, design, and integration service. "Our intent is to cut up to 40% off the time it takes to integrate a company's systems," says Ronald Spears, CMGI Solutions CEO.
Lifeguard Inc., a San Jose, Calif., provider of health-insurance plans, outsources about 30% of its apps development to Cognizant's centers in India. Lifeguard doesn't use Viant, but VP and CIO Michael Reandeau says, "Viant helps companies establish an E-business direction. It delivers on systems software development for building E-business solutions or integrating with legacy systems."
Lifeguard's need for E-services will grow as it replaces its Compaq Alpha servers running SAS Institute's data warehousing software with Hewlett-Packard servers running an Oracle database. At that point, it may tap the Cognizant-Viant team to develop systems for processing online transactions. "We're faced with questions such as: How do I take my business to the Web, and what would this look like?" Reandeau says. "Viant can answer those questions, and then we can turn those plans over to Cognizant."
But Elf Atochem NA, a $2 billion chemicals manufacturer in Philadelphia, uses E-services firms for site design only. Says senior VP and CIO Robert Rubin, "We aren't the type to turn over our systems to someone else."
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