Role of System Integrators in Creating Digital Enterprises

System Integrators need to follow a radically different approach if they want to engage with the emerging Digital Enterprises. There are atleast 6 characteristics shifts they need to explore. 

System Integrators (SI) specialize in connecting disparate computer systems  of their clients to make them work efficiently. Their forte is managing large and complex projects such as ERP or Core Banking implementations that are generally difficult, time consuming and resource demanding. They bring in technical expertise, right tools and techniques, trained resources and can co-ordinate with multiple vendors to deliver such complex solutions.

System Integration is one of the key offerings of many Information Technology (IT) service providers and for many this is the mainstay of their business.  Due to complex nature of the projects, the SI’s spend considerable time bringing clarity to the scope, pinning down the effort and planning for the resources. The contracts are made comprehensive, reviewed at multiple levels and agreed with the client before commencement of work.

The time tested methods of SI may be under threat if we position them in the context of Digital Enterprises that are emerging in the various sectors of the business. These enterprises go beyond the obvious and see IT as core to their existence. They deploy multitude of technologies that can help them understand their customers better, provide an edge over competition and navigate through ever dynamic and uncertain market conditions.  They look to assimilate these technologies rapidly and in most cases in short bursts as demanded by their business situations.  These are organizations in hurry and not risk averse and look for similar characteristics when they procure IT Services. If SI wish to play an active role in helping these Digital Enterprises, their watertight and pre-determined approach to providing technology services require a complete makeover.

There are a number of digital technologies that are on offer. Among these, strong business oriented applications such as such as Analytics, Big Data and mobility and infrastructure platforms such as cloud have increasingly become strategic priorities of organizations. There are others such as Internet of Things and Social Media integration equally vie for the digital investments.  While the adoption of these technologies show an increase,  they pose certain challenges in deployment.  A key among them, cited by the organizations, is the lack of talent within their resource pool and even among their collaborators.   This brings the spotlight on the SI and the role they can play in helping their clients become truly digital enterprises.

There are a number of implications for SI as they attempt to help their clients go Digital. Due to the purpose these technologies serve, they demand a good understanding of the business, different sets of skills among the team and faster pace of realization. The projects are not large-scale or necessarily complex.  Hence, SI need to follow a radically different approach from those practiced earlier for programs such as ERP implementations while retaining the strong technology expertise.   Six characteristics shifts that are interrelated can help the SI’s to effectively participate in their clients’ digital journey.

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Technology Integration to Business Integration

SI’s are conventionally technology focused as the title System Integration indicates. They can make different systems talk to each other, share data and processing capabilities.  To participate in the Digital agenda of their clients, they need to be more business oriented and focus on integrating the businesses especially those operating in silos than merely connecting the respective systems. This shift demands that the SI’s have better understanding of their clients’ business direction, the market imperatives and operational challenges. A more challenging shift is that the SI’s need to position themselves as a partner at strategic level than a vendor at the operational level.   This results in multiple levels of impact across their operations. They need to enhance their capabilities, methods and techniques, staff the teams with right mix of domain and technology experts and prepare to sell at Board level.

Project Focus to Process Focus

SI’s structure their work around ‘projects’ that are characterized by defined scope and timelines.  Digital initiatives tend to be ambiguous. These projects may not have a clear scope to start with and may require iterative approach to realize the objectives. Timelines may not be estimated accurately. Hence, SI’s should manage such ‘projects’ differently.   To start with, they should move away from attempting to clearly define the project with the usual elements of scope, roles and timelines to a more process oriented approach.  This however, does not mean that getting caught into an endless engagement. A process focus means that the SI’s establish a delivery process of interweaving the identified business process and appropriate technology solution, obtain feedback, deploy for use and move onto a next identified process.

Outside-In to Inside-Out

Digital programs need to be planned in an ‘inside-out’ manner, implying that the organizations need to evaluate technologies that are right for their businesses than what others are doing. The traditional services expect SI’s to bring their learnings from other clients for project execution to avoid re-inventing the wheel.  Towards this, SI’s would develop standard methodologies – which in turn would be refined by their industry experience – and bring them for a new project. While this approach has its merits, SI’s should realize that they cannot manage Digital programs with ‘one size fits all’ outlook or in other words follow an ‘outside-in’ approach.  They need to see the requirements from their clients’ perspective and only align those elements in their repository that will make a good fit.  In order to achieve the ‘inside-out’ model, SI’s need to integrate themselves with their clients’ teams  and look at the issues from clients’ perspective.

Reactive Approach to Pro-active Approach

The solutions SI’s provide are generally towards solving certain existing problems – such as redundant or unused applications, duplicate or insufficient data, incompatible infrastructure etc.  The solutions thus tend to be reactive in nature and try to solve past issues.  The digital enterprise will require a pro-active approach, defining and implementing solutions for future needs, even if the current needs are adequately supported by the existing systems.  SI’s need to anticipate the future requirements even while being engaged in current projects and attempt to convert those requirements into future projects.  This again brings the focus to skills of the team members who need to follow a consulting-led approach to their client engagements.

Complex Solutions to Simple Niche Applications

A key agenda for Digital Enterprises is to continuously improve the ways of managing customers and rallying the entire organization towards that goal. This may require deploying applications that can instantaneously bring improvements in customer management or any service related operations. For instance, it could relate to an easier way of processing customer orders or personalizing the offerings to customer specifications. Such applications could integrate with back-end enterprise applications for execution. SI’s need to cater to such requirements by being more agile and responsive.

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Cost Control to Revenue Enhancement

The IT agenda for a Digital Enterprise is moving away from being merely cost reduction to revenue enhancement. SI’s mandate used to be delivering solutions at the lowest cost possible and hence their approach and project costing would cater to such requirement.  However, in the changing scenario, SI’s need to consciously evaluate solutions that can result in enhancing the revenues for their clients.

Conclusion

The competition to SI’s is not from other SI’s but from specialists and smaller firms.  These firms are more focused and can respond to requirements quickly. They may not have the fineness of the processes SI’s have, but are more result oriented. Hence, in such a changing competitive landscape, SI’s need to bring about these shifts as early as they can while making sustained investments over a period of time in structure, people and processes.

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About Raghuram S

I am a Management Consultant with over 25 years experience in the industry and run my own firm called Cohere Consulting since 2008 focusing on business strategy, IT advisory and program management. Prior to this I was with some of the top consulting firms in India including S.B. Billimoria, PricewaterhouseCoopers and IBM. I have participated in a number of strategy and IT delivery engagements across a wide range of industries including manufacturing, consumer products and IT Services. In addition to my consulting assignments, I also spend considerable time in industry research and teaching at premier management institutes. I am based out of Bangalore. I have an MCA from Birla Institute of Technology, Mesra, Ranchi and an MBA from XLRI, Jamshedpur. I can be contacted at raghurams@cohereconsulting.com
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