B2B Integration Managed Services Provider Profiles: Axway Publication Date: 03 May 2017 Product code: IT0022-000957 Saurabh Sharma
Summary Catalyst This report provides an overview of Axway's business-to-business (B2B) integration managed services offering based on Ovum's evaluation of providers that should be on the radar of enterprises interested in outsourcing B2B integration projects. Ovum view Enterprises struggling to maintain legacy electronic data interchange (EDI) solutions and the associated internal resources can benefit from the overall value proposition of cloud-based B2B integration services under a managed services model, delivering people, processes, and technical expertise with significant cost and performance advantages over internal approaches. Decisions to outsource B2B integration are often driven by the need for IT cost reduction and predictability. Moreover, it is quite common to see enterprises struggling to support rapid trading partner onboarding and to meet customer service-level agreements (SLAs) with traditional B2B/EDI solutions, more so in cases of expansion into new market segments and geographies. Cloud-based B2B integration services under a managed services model add the benefits of cloud economics and infrastructure flexibility to traditional integration outsourcing arrangements to offer a compelling value proposition. According to a recent B2B integration survey conducted by Ovum, more than 18% of respondent enterprises showed an inclination to adopt cloud-based B2B integration services under a managed services model. One the key benefits of this approach is that it allows internal resources to focus on more strategic and higher-priority initiatives. Cloud-based B2B integration services under a managed services model provide standardized tools and expertise to reduce trading partner onboarding time and costs. Ovum estimates that enterprises can reduce trading partner onboarding time and costs by 33% to 40% with this approach, once the onboarding process reaches a higher level of maturity. High availability and disaster recovery are key requirements for mission-critical B2B processes. Many enterprises continue to experience issues with system outages having a high impact on customer operations, especially because legacy B2B integration platforms are frequently hosted in environments that have few single points of failure without proper disaster recovery mechanisms. These outages and failures lead to increased downtime and pose a significant risk to customer SLA compliance. With an in-house approach, enterprises will need to undertake significant investment to realize improvements in this aspect of their B2B processes. Cloud-based B2B integration services inherently offer high availability, to the tune of 99.99x% uptime. This is augmented by comprehensive support services, ensuring timely resolution of critical issues, including incident and exception management. Key messages Changes in customer expectations and stringent regulatory compliance mandates are driving major B2B integration infrastructure modernization initiatives. Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 2
A major share of growth in this market is expected to come from modernization initiatives involving the migration and consolidation of legacy B2B integration platforms and processes onto cloud-based B2B integration services. Despite several vendors claiming to offer B2B integration managed services, only a few have a compelling value proposition across core B2B integration and managed services capabilities. The state of B2B integration managed services market Enterprises should consider cloud-based B2B integration services for greater agility at a lower cost of ownership There are two facets to a shift to an "integration-as-a-service" model. The first one relates to the value proposition of flexible infrastructure provisions along with high availability and disaster recovery, which help in meeting customer SLA requirements. The second relates to the economics of using B2B integration services delivered via the cloud and the greater predictability of costs this provides. The value proposition of cloud-based B2B integration services is particularly attractive for enterprises struggling to support heavy transaction loads with existing B2B/EDI platforms. Likewise, it is a good option for enterprises that need to support varying transaction loads with major peaks for a significant period. Cloud-based B2B integration services offer preconfigured templates that significantly reduce trading partner onboarding time and costs. This is a key factor for enterprises that need to onboard dozens of new trading partners and customers every month. Decisions to outsource B2B integration are often driven by the need for IT cost reduction and predictability. Moreover, it is quite common to see enterprises struggling to support rapid trading partner onboarding and to meet customer SLAs with traditional B2B/EDI solutions, more so in cases of expansion into new market segments and geographies. Cloud-based B2B integration services under a managed services model add the benefits of cloud economics and infrastructure flexibility to traditional integration outsourcing arrangements to offer a compelling value proposition. Indeed, more than 18% of respondent enterprises showed an inclination to adopt this approach to B2B integration. One the key benefits is that it allows internal resources to focus on more strategic and higher-priority initiatives. EDI is a mature integration discipline, and enterprises can struggle to maintain the requisite level of talent and expertise to support B2B processes. As per a survey conducted by Ovum in 2016, about 13% of respondent enterprises have considered replacing existing B2B integration as a result of scarcity of expertise in legacy B2B/EDI solutions. With cloud-based B2B integration services delivered under a managed services model, enterprises can have on-demand access to B2B integration and process expertise across a range of areas, including program management B2B integration flow/map development trading partner onboarding and community management infrastructure and systems administration Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 3
support services. From a broader perspective, cloud-based B2B integration services under a managed services model deliver people, process, and technical expertise with significant cost and performance advantages over internal approaches. Enterprises can think of this approach as an outsourced B2B integration competency center. Ovum analyzed cost-of-ownership figures for B2B integration managed services against the proposition of maintaining an in-house B2B integration team with the requisite expertise and found that cloud-based B2B integration services under a managed services model can reduce operating costs by 30% to 40%. Selecting a B2B integration managed services provider Ovum has closely tracked the B2B integration managed services provider landscape over the last four to five years, and we have used these observations as the baseline for inclusion or exclusion in this report. See the Ovum report Selecting a B2B Integration Managed Services Provider (November 2016) for detailed information on individual evaluation criteria for technology assessment. Ovum advises enterprises to consider a range of factors for short-listing a B2B integration managed services provider, including evidence that the vendor is interested in pursuing a progressive strategy that helps ascertain viability and applicability to a range of B2B integration use case scenarios availability of cloud-based B2B integration services under a managed services model reliance on system integrator partners or other managed services providers for the delivery of B2B integration managed services. evidence that the managed services offering is not applicable to just a few specific vertical industries evidence that the vendor is interested in expanding the offering's features and capabilities to cater to the requirements of emerging use cases and exploit new market trends growth in B2B integration managed services business over the last couple of years partnerships with other vendors or service providers aimed at defending market position improvements in terms of offering development, architectural innovation, geographic expansion, and marketing. Vendor profile Axway Axway is a specialized B2B integration middleware vendor with a growing managed services business. Although Axway entered the B2B integration managed services market later than the other vendors included in this evaluation, it has developed a good proposition. B2B integration managed services represent a growing business for the company, and the share of revenue from this business is expected to significantly increase over the next two to three years. Axway is undergoing rapid transformation, and recent announcements indicate a customer-centric approach to product development and a greater focus on execution. Its managed services business is Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 4
well placed to benefit from these strategic advances. As a B2B integration managed services provider, Axway enjoys good brand recognition in Europe and increasingly in the US. Table 1 provides Axway s scores across different criteria groups covered under "technology" and "execution and market impact" assessment dimensions, and in comparison, to the maximum score for each criteria group. Table 1: Technology and execution and market impact assessment, Axway Source: Ovum Strengths and market positioning Axway is a major vendor in the B2B integration middleware market, and its managed services offering exploits the technological strengths on the software side to offer a substantial value proposition. Axway's B2B integration portfolio brings significant product innovation to the market, and recent announcements indicate a more cohesive product strategy and a greater focus on execution, which augur well for its managed services business. Axway should be short-listed for selection of a B2B integration managed services provider. It has significant geographical coverage and a growing customer base, especially in Western Europe and North America. Potential customers should consider Axway's recent advances in terms of its product or offering strategy and roadmap, and how these align with their specific requirements. Its B2B integration managed services business is at an inflection point, with a growing pipeline and scope for significant growth over the next two to three years. Core strengths in B2B integration capabilities are critical for achieving success with a managed services engagement, and Axway has a good and evolving proposition in this regard. Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 5
Appendix Methodology The views expressed in this report are based on Ovum's ongoing research into the global middleware market and take into account observations from briefings with middleware vendors, as well as analysis of the opinions of integration practitioners, developers, and solution/enterprise architects, including those available on public communities and forums. Author Saurabh Sharma, Senior Analyst, Infrastructure Solutions saurabh.sharma@ovum.com Ovum Consulting We hope that this analysis will help you make informed and imaginative business decisions. If you have further requirements, Ovum s consulting team may be able to help you. For more information about Ovum s consulting capabilities, please contact us directly at consulting@ovum.com. Copyright notice and disclaimer The contents of this product are protected by international copyright laws, database rights and other intellectual property rights. The owner of these rights is Informa Telecoms and Media Limited, our affiliates or other third party licensors. All product and company names and logos contained within or appearing on this product are the trademarks, service marks or trading names of their respective owners, including Informa Telecoms and Media Limited. This product may not be copied, reproduced, distributed or transmitted in any form or by any means without the prior permission of Informa Telecoms and Media Limited. Whilst reasonable efforts have been made to ensure that the information and content of this product was correct as at the date of first publication, neither Informa Telecoms and Media Limited nor any person engaged or employed by Informa Telecoms and Media Limited accepts any liability for any errors, omissions or other inaccuracies. Readers should independently verify any facts and figures as no liability can be accepted in this regard readers assume full responsibility and risk accordingly for their use of such information and content. Any views and/or opinions expressed in this product by individual authors or contributors are their personal views and/or opinions and do not necessarily reflect the views and/or opinions of Informa Telecoms and Media Limited. Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 6
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