Authored by Kesava Reddy, Chief Revenue Officer, E2E Networks Ltd
Software as a Service (SaaS) applications have become indispensable for businesses of all scales and sizes seeking agility, scalability, and cost-efficiency. In India, the SaaS ecosystem has become the second-largest globally, with Indian SaaS companies growing at 20-25% per annum, and will collectively reach approximately $35 billion in ARR by 2025. Globally, the SaaS market is worth around $3 trillion and is estimated to surge to $10 trillion by 2030. A typical business uses an average of 130 SaaS applications, and this number is much higher with larger enterprises.
With the proliferation of SaaS applications within an organization, one major challenge often emerges: siloed data and fragmented workflows. Due to this, customers increasingly expect SaaS companies to take on the responsibility of providing seamless integration as part of their service. In fact, SaaS integration has emerged as a vertical in and of itself over the years, and according to research by Markets and Markets, the market size of SaaS integration market was at $4.4 billion in 2020 and will go up to $11.4 billion by 2025.
Effective SaaS integration involves connecting various cloud-based applications to function as a cohesive system. This integration ensures that data flows smoothly across different platforms, automating processes and enhancing efficiency. It enhances visibility of data and, most importantly, helps improve customer experience.
There are various types of integrations. Point-to-Point integration, for instance, stands for direct connections between two applications. Hub and Spoke model, on the other hand, refers to an integration strategy where there is a central integration point that connects multiple applications. Finally, there is also the fully integrated model where all applications directly integrate with each other.
SaaS Integration Approaches
Effective SaaS integration requires careful planning and strategy. Let's delve into some key strategies for achieving a seamless integration.
First, and the most time-consuming one, is to code the integration manually, typically by harnessing APIs. This approach offers full control over the quality, security, and customer experience. However, it can become unsustainable as the number of connected systems grows, consuming increasingly more time and resources.
The inefficiencies of the manual coding approach has led to the emergence of integration services, such as Zapier. In this, the developer of a SaaS platform can build integration of the service with their platform, and thereby, allow customers to tap into a wide range of integration use cases automatically. This is faster and easier as an approach, and a methodology that is becoming a standard amongst SaaS ventures.
iPaaS platforms (Integration Platforms as a Service) operate similarly. They offer pre-built connectors, and enable seamless interoperability between SaaS applications. Additionally, they can also help overcome challenges related to data security, compliance, and maintenance, especially in sectors such as healthcare.
Developers can also leverage open-source technologies like Airbyte, Meltano or Apache NiFi. These platforms are becoming popular, saving the developer from vendor lock in while also helping with control over their data.
Factors to Consider for Effective SaaS Integration
One of the key factors to keep in mind when choosing the right integration strategy is to ensure one is aware of the data laws and regulations. SaaS integration often involves sharing sensitive data between systems, and hence requires tight encryption, access controls, and audit trails to ensure data security and compliance with regulations.
In India, for instance, there are several regulatory frameworks in place that govern data protection and privacy. They have been put in place to protect customer data, and are vital for safeguarding personal data and information. SaaS providers operating in India must comply with these regulatory frameworks and ensure that their integration strategies align with these requirements. Also, they must ensure that their integration strategies align with the requirements of their customers. In essence, developers need to build a deep understanding of the regulatory landscape and the specific compliance requirements of customers.
Conclusion
Effective SaaS integration reduces friction, drives up efficiency, helps automate workflows, and has become a vital part of any cloud application. Crafting the right integration strategy is essential for businesses. While there are several available approaches, businesses should study the regulatory landscape and ensure that their strategy will allow them to stay compliant with the laws of the land in the long run. By doing so, they can ensure a sustainable approach that ensures long-term success.
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