NetSuite announced its “SuiteCloud Connect for Salesforce” initiative last week. The headline story is that NetSuite customers can now easily integrate with Salesforce through third-party integration products from selected vendors including Boomi. Benefits include a seamless lead-to-cash process, deeper customer visibility for sales and elimination of manual process – all good stuff and what you would expect from deeper integration between systems. The announcement also received some attention because it touted connecting the industry’s two largest business application computing clouds together. With all the talk recently on the “open cloud,” this was certainly timely.
However there is a story behind the story that I think is even more significant: NetSuite, after presumably studying the situation and weighing the alternatives, chose to link it’s cloud with salesforce.com using third-party integration products like Boomi’s AtomSphere as opposed to “hard wiring” the clouds together. NetSuite chose to use (dare I say) “cloud middleware” to “loosely couple” their cloud with salesforce.com to deliver a specific integration offering rather than building this infrastructure on their own.
NetSuite’s announcement is a very important development in the industry in my opinion. It makes a strong statement about the use of third party integration products to actually deliver the openness and interoperability required to fully deliver on the potential of cloud computing. This realization was also not lost on Phil Wainewright who made a similar observation referring to "intermediaries" in a recent blogpost.
Increasingly, SaaS consumers are looking for a complete end to end solution that includes pre-built integration. And as Michael Fauscette from IDC points out in a related blog post, this is likely just the beginning of a trend where SaaS vendors offer cloud integration solutions. Clearly just offering a list of integration vendors to end customers was not enough for NetSuite. Nor was offering a set of APIs (most small and mid-size businesses that use NetSuite probably don’t have the expertise or developers to employ APIs in any event).
Instead NetSuite wanted to deliver a pre-built, branded solution for Salesforce integration to its customers. The next possibility would have been to “hard wire” the two clouds together by directly connecting the NetSuite and Salesforce APIs. As I’ve written before, this is a seductively attractive approach because it seems so simple and straightforward. The problem is that end customers typically will customize either or both tenants of NetSuite and Salesforce (or any other combination of SaaS apps). You end up having to write code for every unique combination of tenants which is a maintenance and scaling nightmare.
By “loosely coupling” the clouds together through AtomSphere, NetSuite has off-loaded that entire burden to a third-party provider that specializes in integration – keeping up with API changes, mediating customizations of various tenants, keeping end customers in sync with both applications etc. They can keep their R&D resources focused on delivering world class ERP functionality instead of becoming integration experts.
This makes a ton of sense to us and is a view we have espoused for some time. If you are an ISV and developing or perhaps re-thinking your integration strategy, feel free to read our whitepaper on integration strategies. It will help you think through the pros and cons of various integration approaches. In addition, you can learn more about NetSuite’s new SuiteCloud Connect initiative here.