B2B Meets Cloud Based Integration (CBI)

B2B communication, with its original form of EDI messages, is the oldest and unfortunately the least flexible form of integration between systems and different enterprises. Many enterprises run B2B gateways on-premises or have managed service contracts for “their instance of their B2B Hub.”

I’ve received over the past months an increasing number of inquiries from Forrester clients asking for the future of this approach and the market trend. This is what I usually explain:

Your future cloud/legacy integration should cover your business partner and your SaaS applications. Cloud computing is disrupting the integration space! Why? Traditionally, you had two very distinguished integration scenarios. Either, it was about the integration between multiple systems within your enterprise — middleware software, with product categories like EAI, ESB, CIS, and BPM, was the matching solution, as all systems have been on premises in the past. Or, it was about the integration with your business partners — the well-established B2B/EDI gateways and managed services were the matching solution over the Internet (or VANs). However, cloud computing disrupted the space already: Suddenly parts of your business unit’s applications are in the cloud on packaged SaaS applications, and they needed to be integrated with your on-premises legacy. Or, you and your business partners even use the same SaaS applications, and B2B traffic is as simple as moving data from one tenant to the other tenant on the same cloud platform. To face this trend of an increasing variety of integration, a good cloud integration strategy should look at synergies between the cloud/legacy integration scenarios with your business partners and the SaaS tenants of your own enterprise holistically!

CBI filled in the gap to integrate your SaaS applications. Cloud computing in general is characterized by its strong standardization, self-service, and the opex-driven consumption models — and many SaaS business applications deliver this model very well. However, most traditional B2B vendors are stuck in a managed service paradigm and struggled to offer real SaaS-based integration. Most also missed the fact that cloud-based solutions need to be significantly simpler than traditional, overcomplicated integration software; especially if you like to serve SMBs or enterprises, which intend to keep an SaaS standard. This has led to the advent of a whole new category of so-called cloud-based integration solutions (CBI) with totally new players like Boomi (acquired by Dell), Cast Iron (acquired by IBM), or Informatica’s Cloud business line. The CBI category is introduced in this report.

Although, CBI is mostly used to link, for example, your own salesforce.com CRM tenant to your on-premises SAP business suite, its simplicity is appealing for further scenarios, such as the dataflow from your suppliers’ SaaS tenants into your ERP!

CBI is not yet “integration PaaS.” Forrester believes that we need to reserve the term “integration PaaS” for those platforms that can actually be used to create full business applications, not just the integration part. Please check my upcoming report about the different PaaS capabilities in the market, which will appear very soon here. It will be interesting to see how CBI vendors will enable in the future more packaged integration scenarios. The lines between simple CBI and integration-PaaS might blur with some native cloud platforms soon.

Analyze your integration workloads by change frequency and volume. Enterprises ask me how to build an integration strategy and deal with the cloud, existing gateways, and B2B vendors. Here’s how I recommend mapping the different integration workloads to available solutions.

  • Keep the legacy for low transaction volumes and stable business partners. A major driver of the TCO in B2B integration is the onboarding of a new business partner or the fast implementation of new message types. Secondly, the technical operations of a B2B gateway can become challenging if you operate millions of messages per day. If both do not really apply to you, simply keep what’s working or look for a modern on-premises solution.
  • Managed services can operate high volumes efficiently. This is not really SaaS, it isn't simple and basically operates the same software stack, that you could also license and operate on your own. But, especially if the software vendors themselves offer the managed services, the skills around their stack and operation excellence are obvious benefits of managed B2B service.
  • CBI’s real SaaS deployment and simplicity reduces the cost of frequent change. Dealing with many new business partners every month requires a dramatic reduction of complexity. That’s exactly what the CBI tools delivered for the integration of SaaS applications (Boomi and Informatica-Cloud are good examples). Evaluate them also for simple B2B scenarios in frequently changing business networks. But, watch out for the pricing; some CBI solutions in the cloud are priced based on the traffic volume and might become expensive dealing with tens of thousands of messages per day.
  • Frequently changing, high-volume large business networks are best addressed with a hybrid integration strategy. If you have a mixed landscape of high-volume traffic of several million messages per month, but also a lot of change with frequent new business partners and new data formats, you might run a hybrid solution. You can use, for example, IBM’s Sterling Commerce for the high-volume parts, while you leverage the self-service capabilities of IBM’s Cast Iron Live for the SaaS and simple B2B integration.

The whole space is in flux, as the disruption through cloud-computing-based models will increase over time. Many enterprises that moved to SaaS applications for CRM, HR, and email/calendar are actually really frustrated that most traditional B2B vendors talk about cloud but do not really offer anything beyond the traditional hosting and managed service delivery.

The more enterprise embraces the economics of real SaaS business applications, the more they will demand real SaaS-economics for B2B integration. This paves the road for new enterprise-grade B2B solutions merging the traditional EDI capabilities with characteristics of CBI such as a self-service catalogue of transparently priced, ready-to-use integration scenarios. Companies like Hubspan pave the way for this kind of enterprise-grade CBI/B2B solutions with new product architectures.

Where are you right now?

Still in the old B2B world exclusively?
Already using some CBI for your SaaS apps?
Or already looking at cloud-based integration for simple B2B integration?

Please click the POLL on the right column of this page - Thanks

Stefan Ried

Comments

Cloud-based integration has great potential...

Cloud-based integration has great potential, and I expect that more and more systems will work this way as cloud adoption continues. I am concerned, however, about the perception of the cloud as a panacea for integration. It’s far from that. In fact, when it comes to integration, the cloud is a difficult, complex tool, and that’s why enterprises generally use managed services when they adopt it -- they don’t want to deal with that difficulty and complexity themselves.