Organizations are investing millions of dollars to digitize everything from supply chains to people. This can lead to multiple applications creating siled processes and data. More complex enterprise IT landscapes exist in the cloud, on-premises, or perhaps a hybrid of both. The volume and mixed landscape of applications is complex and costly, and this “spaghetti landscape” can be an obstacle to digital transformation.
This is where integration capabilities become a key success factor. Analyst firm IDC has released the IDC MarketScape: Worldwide Cloud Integration Software and Services (iPaaS) 2023 Vendor Assessment. According to the report, “In addition to deriving direct business benefits, integration replaces the technical debt previously used to connect applications and can easily replace older legacy applications. It’s the underlying connectivity automation technology.”
Further, the IDC report states, “Despite the economic climate, many organizations still prioritize investments in connectivity-based automation, especially cloud-based integrated software and services.”
Consider this customer case. Jumbo Supermarkten is a Dutch food chain based in his Veghal, with stores in Belgium and the Netherlands. Previously, Jumbo used an Excel-based tool called the Production Advice List (PAL) to forecast fresh baked goods, convenience items, and ready-to-eat meals. This manual process led to inaccurate forecasts, dissatisfied customers, and wasted food.
Food waste is an important global sustainability issue. It wastes the natural resources used to produce and transport food to consumers, and spoiled food produces methane, a greenhouse gas. In the Netherlands alone, over 75 pounds of food is thrown away per person each year.
To improve sustainability and customer experience, Jumbo decided to digitize its PAL system using SAP Business Technology Platform (SAP BTP), which includes integration, automation, data and analytics solutions.
With SAP Integration Suite, the foundation of SAP BTP, PAL 2.0 automatically integrates historical information with current data from SAP and non-SAP applications. Employees can now analyze real-time information about pricing, promotions, assortments, and other factors to accurately predict food inventory.
Even better, employees can get this information on their iPads so they can make better decisions on the go. This intelligent forecasting system has allowed the company to work towards achieving a delicate balance between ensuring product availability for its customers while avoiding overstocking.
Jumbo’s story offers some lessons. First, as IDC points out, consolidation helps reduce technical debt. Enterprises can leverage existing applications to add value to their business, but traditional applications create resource “resistance.” Second, integration drives innovation. By connecting SAP and non-SAP applications with external data such as weather and holidays, businesses can innovate and address their most pressing challenges.
In the aforementioned IDC report, SAP was named a leader in this initial vendor evaluation. Its strengths are its “wide partner network” and “speeding up the development of new connections with powerful AI capabilities such as interfaces and mapping proposal services based on AI and machine learning.”
An uncertain macroeconomic environment puts pressure on organizations to improve their profit margins. A robust integration strategy is the first step in getting more value out of your existing IT systems. Therefore, choosing the right enterprise-level integration solution is critical to paving the way for accelerated connectivity and innovation.
To learn more about the benefits of integration, check out our Integration Scoop podcast series.
Ragunath Ramanathan is SAP’s Chief Revenue Officer.
