4 Reasons why Organizations and CFO’s need SaaS and Cloud Integration ?

This entry was posted by Wednesday, 16 May, 2012
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saas cloud integrationDoes your organization prefer technological upgrades?

If no then you should. Regular technological advances are the key for success of any organization and such upgrade decisions in an organization are basically taken care by the Top Management like CEO’s and CFO’s, as they are well versed with the right time  for implementing such changes.

If we talk about Chief Financial Officer’s [CFO’s] they are always trapped in-between data.  Lots of Data entry gives them a lot of burden and sometimes even creates confusion due to double Entry. DBSync works to resolve such kind of problems by reducing the double data entry for customers and increasing the visibility of multiple applications. Cloud Computing is one of the fastest growing fields according to a new Microsoft-funded survey it shows that spending on cloud deployment could double in the next 5 years.

Let’s have a look what these terminologies actually mean:

SaaS-Software as a Service, sometimes referred to as “on-demand software”, is a software delivery model in which software and associated data are centrally hosted in the cloud. SaaS is typically accessed by users using a thin client via a web browser.

Examples of common SaaS applications are:

  • CRM (customer relationship management) systems such as Salesforce, Microsoft Dynamics CRM
  • Intacct or NetSuite for Accounting
  • Google Docs and Apps and many more

PaaS- Platform as a Service (PaaS) is a category of cloud computing services that provide a computing platform and a solution stack (a solution stack is a set of components needed to deliver a fully functional solution, e.g. A product or service.) as a service. In this model, the consumer creates the software using tools and libraries from the provider. The consumer also controls software deployment and configuration settings. The provider provides the networks, servers and storage.

An example of PaaS is Facebook.

  • Force.com or database.com from Salesforce
  • Microsoft XRM
  • Intacct, NetSuite, Intuit – extension to standard accounting

iPaaS-Integration Platform as a Service iPaaS is a platform for building and deploying integrations within the cloud and between the cloud and enterprise. With iPaaS, users can develop integration flows that connect applications residing in the cloud or on-premise and then deploy them without installing or managing any hardware or middleware.

Example – DBSync: www.mydbsync.com

IaaS- Infrastructure as a Service (IaaS) sometimes referred to as “hardware as a service”, IaaS is an outsourcing model under which users rent equipment accessed via the Internet to support their operations, including storage, hardware, servers and networking components. One of the most well known forms of IaaS is Amazon.com .According to a Survey it was projected that the overall market for dedicated hosting and cloud infrastructure-as-a-service (IaaS) could hit the $3.8 billion mark by the end of 2012, with a 14 percent compound annual growth rate.

Examples include

  • Amazon EC2, S3
  • Microsoft Azure

Let’s look into few doubts which may arise in a CFO’s mind while thinking about Cloud.

  • Reason 1- What Cloud integration ?

Cloud integration is the provision of interface and data exchange between a hosted computing service and any other endpoint. The Typical functions of Cloud integration include loading, synchronizing, cleansing and replicating data. Example: DBSync and salesforce.com integration. Around 33% of World Business has today implemented Cloud Integration and this percentage is growing.

  • Reason 2-Is Cloud integration growing Proficiency for the CFO’s?

Integration is emerging as a proficiency which should be adopted by the Business. Cloud integration allows business leaders to break free from legacy infrastructure with surrounding legacy solutions with new and innovative cloud-based approaches. CFOs should take an interest as cloud integration impacts financial reporting, regulatory compliance, audit trails and the bottom line. If we analyze the small business regarding their payments made for reducing the double data entry we could find that the cost paid to the employee for it is around $ 20 an hour and they work around 10 hours in a week. Hence in 1 year (52 weeks) the company would spend

52weeks X 10 hours/week X $20 = $10400/ year

it’s a huge amount for a company spending on reducing the double data entry where as software’s like DBSync would cost the organization around $1500 a year. Not only does such integrated solutions save money, but also provides visibility across application. Further, the cost of starting up is very minimal as there is no upfront capital cost for servers, the cloud provider takes care of it for you.

  • Reason 3-Do Cloud integration costs much?

The question to be asked should be what is the Total Cost of Ownership (TCO). Lets look at a traditional Integration setup

Item Cost($)
Server (Primary and backup) $5,000-$10,000
Software $3,000-$15,000
Administrator/Engineer $40,000-$90,000/year
Software Upgrades and Maintenance $1,000-$3,000/year

So, given a scenario above, we see a startup cost of $50,000 or more with an annual cost of $90,000-$95,000.

Now, if we compare the above with Cloud Integration, you do not need servers, purchase software licenses, hire administrators or worry about upgrades. All these are normally part of you subscription licensing fees and perhaps a annual maintenance fee of $500-$1000/month. So, with everything deployed you are looking at $15k/year as compared to $90k+ / year.

So, the cost of Cloud Integration doesn’t cost much, as compared to the services and the benefits provided by it. In fact Cloud integration, also bring in inherent advantages  like data security, scalability and a flexible subscription model of expanding use – pay as you use.

  • Reason 4-Is Integration approach suitable for the long run?

Enterprises choose one of the four forms of integration

  1. In-House Developed Integration
  2. Purchase a Middle ware to perform point-to-point integration
  3. Use a 3rd-party provider to manage an integration by providing Remote access in  infrastructure provided by your firm.
  4. Cloud Integration, where a Integation Platform-as-a-Service (iPaaS) provider provides template based integration as a service.

As business leaders procure more and more SaaS/cloud applications, managing the ever-changing landscape of point-to-point integrations raises the total cost of ownership (TCO). Quite frankly, point-to-point integration is not scalable and is costly in the long run. CFOs can exert leadership by suggesting a more comprehensive approach to cloud integration that accounts for starting small and growing to meet demand. The worst thing a CFO can do is rip out a short-term tactical solution in couple of months after it proves not to meet data volumes or scale to meet complexity.

Hence these points may clear some doubts which would have arrived in the Mind of CFO’s. As a result, CFOs who have made decision authority to move to the cloud need an integration architecture approach that aligns with the security and regulatory compliance issues that go with protecting business assets, reducing operational for both IT and other processes, while delivering a high level of agility and scalability. A multipoint cloud-integration with a subscription based pricing approach will deliver the best ROI and align most closely with the architectural and technical benefits of consumerization of IT. More importantly, CFOs play a key role in articulating the benefits of overall cost savings and increased productivity and helping the business and IT effectively collaborate.

Here’s a demo of a Salesforce replication to database:

Salesforce replication of database

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Get in touch with the author of this article Manish Nair.


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