Using various IT components for diverse purposes is a typical practice. However, when business functions grow, firms may get overwhelmed by an excess of different systems that cannot share data or collaborate. Whether in business, automation in factories, or cloud-based services, integration of information technology guarantees that all elements of a company’s online infrastructure connect properly.
In this guide, we will discuss what system integration is, types of integration systems, how it works, real-world examples of integrated systems, and the benefits and challenges involved.
What is System Integration?
System integration is the process of combining various systems into one, bigger system that works. It allows enterprises to transmit information between various subsystems automatically by interpreting data from many sources inside the technological stack. The purpose of system integration is to remove disconnects between multiple systems by making sure that data flows effortlessly across platforms. This entire system integration process enhances business performance and communication.
How Does System Integration Work?
System integration is the process of linking several systems of computers and software applications so that they can work together as a single system. There are several approaches to doing this, but the main goal is to allow data to flow easily between multiple systems. This could involve transferring customer data from an online shopping site to a customer relationship management (CRM) solution. In this manner, the CRM system has the most current data to deliver better customer support. By integrating systems, you remove data silos, or separate areas of information within an organisation. This increases productivity and prevents situations in which various departments have contradicting information.
Types of System Integration
The type of system integration you select will be determined by your company’s present technological stack and goals.
Data Integration
Data integration is the process of gathering information from multiple sources. The platforms, services, and databases are all possible examples. By combining data from several sources, businesses get critical points of access and increased insight into different systems. An effective software system integration facilitates the processing and consumption of data generated by users and the systems they use.
Legacy System Integration
Legacy system development integration is the process of connecting legacy systems with current, up-to-date IT infrastructure. This allows for a smooth connection between data from ageing systems and newer, quicker IT components. Employees can experience uninterrupted workflows thanks to good legacy system integration, which pulls data from older apps that they still need to accomplish their tasks.
Enterprise Application Integration (EAI)
Enterprise application integration connects disparate subsystems in the company’s infrastructure. The idea is to merge functions from several programs into a single environment. For example, you could leverage IT system integration to combine inventory management and fulfilment data. This would allow you to make more strategic judgments about what to purchase and how to ensure delivery on time.
Business-to-Business Integration
Business-to-business integration refers to the seamless exchange of documents and transactions across several firms. The purpose is to improve cooperation among consumers, business partners, and vendors. A business-to-business integration system could be used to link an online store’s solution with a supplier’s warehousing software. This would allow the manufacturer to use consumer order data to determine when the merchant needs to order additional inventory.
Electronic Data Interchange (EDI) Exchange
Electronic data interchange (EDI) exchange offers firms electronic communication tools for sharing business documents. EDI makes the data that flows back and forth comprehensible and actionable. A reliable EDI system results in more simplified corporate processes due to seamless data transfers across applications.
Benefits of System Integration
System integration is a process that can provide several benefits to businesses of any kind. Some of the main advantages of system integration are:
Increased Efficiency and Productivity
By integrating various systems, data silos are avoided and human data entry is reduced. This streamlines procedures, lowers errors, and allows employees to focus on more critical activities.
Improved Data Visibility and Accuracy
System integration guarantees that data flows smoothly throughout the organisation. This delivers a more comprehensive and reliable perspective of operations, resulting in greater real-time data-driven decision making.
Enhanced Collaboration
Integration encourages cross-departmental communication and collaboration. With linked data and functionality, departments may collaborate more efficiently to achieve common objectives.
Better Customer Experience
A horizontally linked integration system provides a 360-degree perspective of the customer journey. Businesses may personalise interactions, predict consumer demands, and deliver a more regular and happy customer experience.
Reduced Costs
System integration reduces data redundancy and decreases the need for manual procedures. It can also result in higher productivity and lower operating expenses.
Improved Competitive Advantage
Top system integrators help businesses gain a competitive edge by implementing seamless solutions that improve workflows and service delivery.
Scalability and Flexibility
An effective software system integration is easily scalable to meet future expansion and changing business requirements.
Simplified IT Management
System integration can make IT administration easier by unifying tools and lowering the complexities of managing different platforms.
System Integration Methods
There are several approaches to establishing connectivity across unconnected systems. Here are four main system integration methods:
- Vertical Integration
This method allows an organisation to merge unconnected subsystems into a single functional unit by separating them depending on their capabilities. Each layer or component of vertical integration progresses upward, and the integration process is accelerated by relying on a small number of vendors, partners, and developers. Although it is thought to be the quickest form of system integration, it may be the most risky because it needs big capital investments. - Horizontal Integration
The horizontal integration approach, commonly referred to as the enterprise service bus (ESB), designates a specialised subsystem for communication with other subsystems. It decreases the number of connections that link directly to the ESB to just one, lowering integration system costs and increasing flexibility. - Point-to-Point Integration
This approach joins the remaining subsystems. Once joined, these interconnected structures form a star polyhedron. Most businesses separate their processes through point-to-point integration. For example, a distinct accounting system may track funds, a web analytics system could control traffic to a website, and Salesforce would be integrated with a customer resource management (CRM) system. According to the organisation’s requirements, data from each system could be extracted and integrated. - Common Data Format
The widely used data format benefits organisations by allowing them to translate data and automate processes. This solution was developed to avoid the need for an adaptor for each data conversion operation. The integration of information technology is used to facilitate software system integration by transforming one system’s data format into one that is accepted by another.