WORKING TOGETHER...WORKING BETTER

WHY INTEGRATION MATTERS
Thomas G. Stephens, Jr., CPA, CITP

INTRODUCTION
As organizations seek to become more efficient and more profitable, one of the key strategies used to achieve these goals is that of integrating multiple information systems and the data contained in those systems. In this article, we’ll examine how integration improves organizational efficiency and explore various examples of integration in place today.

WHY INTEGRATION MATTERS
Increased efficiency, improved customer service, better management of assets, and improved decision-making capabilities are lofty, yet realistic goals of most organizations. However, with the explosion of information technology assets and systems in use today, attaining these goals is sometimes restrained by the number of disparate and non-integrated applications in use. As long as these applications continue to lock data away in highly compartmentalized information “silos”, achieving these goals will remain a challenge.

Over the past ten years, the number of systems and databases in use by organizations of all sizes has increased significantly. We now have separate systems – and related databases – for our accounting functions, fixed asset management, customer relationship management, order entry and tracking, human resources, and for almost every other conceivable function with an organization. And there seems to be no end in sight to this cycle of acquiring and implementing applications for virtually all organizational functions.

The extent that the data in these disparate systems can be unlocked and shared across the organization gives the organization a much better chance of meeting its objectives. Such is the impetus behind integration.

EXAMPLES OF INTEGRATION TODAY
In today’s highly automated environments, opportunities for integration exist almost at every turn. Increasingly, traditional accounting systems are integrating with other applications internal to an organization, including customer relationship management systems and point-of-sale systems. At the small business level, this might take the shape of an application like Microsoft Office Accounting Professional integrating into Outlook through Business Contact Manager Update and also integrating with Microsoft Dynamics Point of Sale. At the mid-market level, integration might take the shape of Microsoft Dynamics GP integrating with Microsoft Dynamics CRM and Microsoft Dynamics Retail Management System. In addition, organizations are also integrating with external applications, including those maintained by supply chain partners such as customers, vendors, and shipping firms.

Accounting firms are also taking advantage of integration options and features. Increasingly, accountants in public practice are integrating their write-up and trial balance applications with their tax applications and even their time-and-billing and practice management applications. A major trend has emerged in public accounting to integrate an increasing number of their applications with some type of document management system (DMS), facilitating the easy filing, retrieval, and management of electronic documents. In some cases, the DMS is built on Microsoft’s SharePoint technologies as a foundation technology.

One key technology driving integration is that of Open Database Connectivity (ODBC). Databases – such as Microsoft’s SQL Server, SQL Express, and even Access – written to the ODBC specification have the ability to share data across multiple applications. Thus, a CRM system storing data in SQL Server can easily and readily integrate with an accounting system, even if that accounting system uses a different database, including databases that are not part of the Microsoft family, as long as that database was written to the ODBC specification.

BENEFITS OF INTEGRATION
Of course, all of this integration would not be occurring if there were not demonstrated and significant benefits to be realized. In other words, as with any information technology initiative, there has to be a positive return on the investment required to achieve integration of formerly disparate systems.
Among the many benefits associated with integration are:

Eliminating wasteful, redundant data entry. In a fully integrated environment, the mantra becomes “never enter data twice”. For example, critical customer information such as customer name and address are entered in either the CRM or accounting application, and flow from one to the other.

Increased accuracy of all data in the organization. As an added benefit of eliminating redundant data entry, the opportunity for data entry error is diminished. More accurate information leads to more accurate and useful reports and, ultimately, to better decisions.

Real-time or near real-time accessibility of key information. Because data is integrated across multiple, otherwise disparate systems, it is available across users of all of these systems in real-time or near real-time. With this increased exposure of key data, organizational decision making almost certainly is improved.

Improved customer and client satisfaction. Because customer and client data is integrated and synchronized across the organization, customers and clients receive more timely and accurate responses to questions and, in turn, experience greater satisfaction with an organization’s service.

More efficient asset management. With fully integrated data across the organization, asset management is optimized based on the availability of this data. For example, fully integrated data throughout an organization’s supply chain allows for more efficient inventory management – as customers are purchasing existing inventory stocks, purchase orders can be sent in real-time to vendors to replenish inventory stocks.

In sum, data and systems integration ultimately lead to increased profits… profits that supply a handsome return on investment.

SUMMARY
As organizations seek to achieve greater efficiency and profitability, one key strategy for attaining these objectives is integrating and harmonizing the data across the organization. Doing so allows a company to leverage the investment it has made to collect the data in the first place, reduces the number of instances of redundant data entry, increases the accuracy of information within the organization, improves customer service, and allows for more efficient asset management. Technologies and opportunities for integration abound and the benefits of doing so are significant. The only question is “when do we get started?”

The views and opinions expressed in this column are those of the author and do not necessarily reflect the opinions of Microsoft.