This article examines some of the challenges that today’s system integration companies face. The future is somewhat clouded because these companies need to choose the right path. It’s an important choice between a few different directions. The answer probably lies between industry predictions and gut instinct as to where the market is going to trend upwards.
The transition from onsite LANs where equipment, operating systems and data is held onsite to cloud based computing networks is in full swing.
System integration is the engineering service glue between the hardware and software vendors and the end customer.
Most system integrators partner with vendors that provide valuable support, regular availability of equipment and possess a product range that meets the sweet spot of customer need.
Usually system integrators have expertise in a diverse set of technologies from different vendors; hence the term system integration.
Those same underlying business relationships will still exist in cloud integration but determining who to partner with and where to direct investment in capital and resources is another challenge.
The system integration market has evolved because vendors develop hardware and software and then resell their product through local partners who have personal relationships with customers.
Increasingly system integrators consult, recommend, install and support the vendor solution as a managed service offering.
However, the cloud presents an alternative proposition which requires redefining and positioning the value that is performed through system integration.
Vendors have occasionally attempted to bypass the channel in order to have direct relationships with end customer in an attempt to increase their margin. This has proven to be difficult particularly where the vendor has weak local branding and physical presence.
Relationships are still going to play a huge role in the ability to do business – people buy from people.
Customers prefer to speak with people they know and trust rather than risking becoming a statistic or working with an unknown international help desk.
A good system integrator adds a personal touch with local people and trusted resources.
Cloud computing presents a great opportunity for system integrators to play their part albeit with a modified service offering. We are heading to a subscription based society and the IT services market is not different.
Such a model protects both the customer and the integrator by guaranteeing a level of service in addition to predictable expenses and income. The very nature of these relationships will become stronger as the integrator becomes more ingrained with their clients as a partner rather than a transactional supplier.
Systems integrators will become SaaS integrators as the IT model continues to shift.
Supplier relationships will probably become more international but the local, end-customer relationships are still going to play a critical part in the number of deals won and the success of the implementation.
Selecting the right partners is one of the critical challenges when it comes to moving forward.
There are several possible strategies for today’s system integrators.
One includes developing an infrastructure business. This would be a logical evolution for system integrators because they have significant experience and investment in supplier relationships and internal skills. The issue is that companies like Amazon and Rackspace have significant global investments in hardware infrastructure that will have competitive advantage in terms of scale and cost.
The other obvious strategy is to expand managed services to integrate cloud products.
Given that no one vendor will provide all software and hardware, there will remain a viable model for operating system administration and end user support. This will develop more into a fixed fee services on a per seat basis with a menu of services the end customer can choose from.
How about consulting and implementation?
This is also a logical place for system integrators to lead as they can add value to customers through expertise and innovation on how to implement and operate applications.
Customisation of existing SaaS platforms is going to be a huge business which means that having engineering capable of documenting business process and programming it to match will be a much needed requirement and a shift from traditional systems integration.
One thing for certain is that there is going to be a need to remotely support mobile devices.
Mobile Device Management is already a big trend in the management tool box. Remote control of smartphones will become necessary because they are effectively small computers that businesses will need to control.
Smartphones are at the point where PCs were 20 years ago.
Today, smart phone support is performed by asking the end user to make particular tasks and asking them to tell you what they see. It’s not very efficient. Expect to see Mobile Device Management presented as a value proposition in future managed services offerings.
In any event, the choices for system integrators are not simple and careful consideration of the opportunities to invest in will be required.
The opportunities are vast and but the successful system integrator will have to choose very carefully.♦ End