The state of the NZ market

Most work being done in EAI can be found in three industries: finance and banking, telecommunications and government.

Most work being done in EAI can be found in three industries: finance and banking, telecommunications and government.

IDC, in a report "Leaders and Contenders: Competitive Analysis of EAI Services Firms in Asia-Pacific", describes these as "classic sites" of EAI-type work, but for three different reasons.

The telecommunications industry is struggling to keep up with the pace of technology. Second-generation mobile technology is being replaced by 2.5G and soon 3G, and telcos get ever-cleverer with copper, so the IT infrastructure and associated systems such as logistics, customer service and billing must also be upgraded.

However, EAI proponents say the technology provides a distinct cost and time advantage over custom-built efforts, because it does not need to replace existing infrastructure. New systems dovetail with the old. So Telecom adopts an EAI solution from Datacom, rather than a complete network refit from Lucent.

The government, says IDC, is rich in EAI-type scenarios. Often large organisations with limited IT budgets, government departments tend to be replete with a range of different IT systems and environments, some mission-critical. These type of environments are generally challenging for any type of solution, including EAI, but cost savings appeal. The New Zealand government has had some high profile "big bang" failures -- notably INCIS -- and so is "particularly well-disposed", says IDC research director Mike Cranna, toward solutions that may achieve similar goals without the associated high risk and cost.

Traditionally, banks possess many customised applications and their adoption of ERP systems has been confined to specific functions like accounting. Consequently, they have long had an understanding of integration and its challenges. But new, often customer-focused projects are emerging where integration between several applications is being considered. Rather than being portals-based, these projects aim to re-assess integration needs between all the existing applications and constitute one of the early efforts to homogenise the IT infrastructure of a company.

As Cranna warns, adding software layers between applications tends to increase the complexity of the IT infrastructure.

“Ideally, EAI tools should not exist and should be integrated by makers of enterprise applications. EAI also fails to capture the overall picture of the IT infrastructure.

Integration of enterprise applications is linked to hardware capacity and performance. As IT systems are currently a patchwork of such diverse solutions, whether on the application level and/or on the hardware level, integration services only constitute a partial answer to the needs of end-user enterprises.

“Nevertheless, there are clearly situations where EAI can be of immense benefit, such as in the case of Telecom New Zealand’s upgrade to CDMA. The cost savings in conducting the implementation in this way, with no major concerns about increased stability resulting from increased complexity, outweighed any of the above concerns,” Cranna says.

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