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10/16/2008
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SaaS Integration: Real-World Problems, And How CIOs Are Solving Them

Installing SaaS applications is easy. It's integrating them that can drive up the cost and complexity SaaS is supposed to avoid.

FROM THE SAAS TRUE BELIEVERS

Doug Harr, who became CIO at open source database vendor Ingres three years ago, has no intention of ever using conventional middleware in his IT environment, which is based almost entirely on SaaS. In previous jobs with Portal Software and Core Technology Group, even as middleware from Oracle, Tibco, and others took off in popularity, Harr avoided using them because of their high cost, opting for custom-built point-to-point integrations. Now he's focusing on working with SaaS vendors that have put a lot of effort into integrating their software with products from other vendors.

He's already integrated accounts receivable from SaaS vendor Intacct with Salesforce CRM, easy enough since those vendors have done considerable integration work. In fact, one reason Salesforce won the CRM deal over NetSuite was because of that work, Harr says. But there's more he'd like to do, such as bring employee data out of ADP and feed it directly into Intacct for accounts payable, eliminating the need for someone to manually key employee names into Intacct for distributing expense report payments.

To solve some of his integration problems, Harr is looking at the offerings in the emerging category of SaaS integration appliances and online services, including those from Bluewolf, Cast Iron, and Boomi (see "SaaS Integration Specialists Find Their Niches"). Ingres may still have to write some code, but since most SaaS apps were developed from the start with Web services in mind, he says the coding is simpler than with conventional on-premises apps, even those that have been given a Web interface.

Employers Direct, a company that provides workers' compensation insurance in California, uses Cast Iron for SaaS integration. When CIO Joe Cardenas co-founded the company in 2002, he eschewed an on-site data center: All the software applications Employers Direct uses are delivered via SaaS or hosted by a provider. Employers Direct has 17 full-time IT staffers whose main job is to manage those SaaS and hosted relationships and ensure smooth integration between them. The company's most significant IT infrastructure investment is in the supporting bandwidth.

Cast Iron is a server-and-software appliance that runs in a customer's data center or is hosted by Cast Iron, and it guides an IT professional, typically a systems analyst, through the integration between a software service and an on-site software application or another SaaS vendor. Employers Direct uses Cast Iron to integrate its hosted claims processing system with check processing services and with California's insurance departments and court system via the Web. IT staffers had done manual coding for earlier SaaS integrations, but Cardenas' goal is to phase that out and rely more heavily on Cast Iron.

As an appliance, it also handles the run cycles and monitoring required of online software connections, so it makes sense to have it handle as much of the SaaS integration as possible, he says. "Down the road, we'll make sure everyone is well trained on the product," Cardenas says. "Then we'll start to aggressively take those manually coded Web services and convert them over to Cast Iron."

Yet even more important than a disciplined technical strategy in an integrated SaaS environment, Cardenas says, is talent. "The Web services people are golden," he says. He defines them as IT pros who have transitioned from the mentality of building an IT architecture in-house to creating a linked, online environment using Web services.

But while a modern Web services philosophy is important, open minds are important, too, whether evaluating SaaS or a more conventional option. "There are a number of people we've interviewed who were .Net bigots, and I don't like to see that," Cardenas says. "You need people who know the strengths and weaknesses of various platforms."

Vendor management skills are also essential in the IT staff, Cardenas says. Standard precautions must be taken when relying on outside companies to support the IT environment, such as extra software testing to make sure their work's up to snuff. Staff members find they occasionally have to hound SaaS vendors on the phone and accept that integration processes can occasionally take longer than expected, since there's less under the control of Employers Direct. H.B. Fuller's John agrees, calling the SaaS environment a form of modern-day outsourcing, and says that many of the project management skills needed to manage an outsourcing agreement are needed for successful SaaS integrations.

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