Answering the question of how much system integration costs is not straightforward. Integrating systems is a form of software development, and we have previously discussed why estimating the cost for such projects is challenging.
First and foremost, the cost depends on the type of system integration your company chooses. There is a significant difference between merely integrating two systems with a point-to-point integration and developing and implementing an entire integration platform. Even so, the former can range from a small task costing 150,000 SEK, while a complex integration project can cost many times this. The price depends on various factors such as the system's architecture, the vendor, and data formats.
When investing in an integration platform, there’s two main options to choose from: iPaaS (Integration Platform-as-a-Service), a pre-built cloud-based platform that enables companies to develop, execute, and govern integration flows, or a custom-built integration platform, built for your company’s specific needs.
Despite an iPaaS more or less being an off-the-shelf solution, the price ranges heavily, mostly depending on the vendor you choose and what they offer.
The cost of an iPaaS can depend on several factors:
Different vendors charge different amounts for their solutions. This can, amongst other things, be related to their licensing model, and they may charge monthly or per year.
The cost can vary depending on the number of users accessing the system, the number of systems to be connected, and the total data volume being handled.
Even if it goes by the name of an integration platform, the functionality between different iPaaS solutions can vary significantly. Some have more advanced features and greater scalability, which often drives up the price.
The cost of maintenance and support may be included in the subscription price for the service but may also be billed as a separate cost.
The price may vary depending on how long you commit to the integration platform.
If you are interested in an iPaaS, there are several providers with varying pricing models. Some major ones include Mulesoft, Jitterbit, and Workato. A few of them have a rather complicated pricing model as the cost is based on usage, making it difficult to get an overview. Often though, they provide a starting cost, which can at least give an indication of the expected cost. Usually, you pay per month, and typical iPaaS services cost at least 10.000 SEK per month as a starting point, often considerably more.
When developing a custom integration platform, pricing can be divided into two parts, one relatively predictable, and the other somewhat less so.
The predictable part is the core of the integration platform. It consists of things like communication technology, monitoring, and the deployment flow (taking the software from a test environment to a live production environment) and does not need to be adjusted much depending on the customer. This is custom built for the specific company, but is in broad terms essentially the same type of components.
The other, somewhat less predictable part relates to your company’s individual systems and comes into play when everything above has been built. In essence, it depends on what type of systems you have in your business today which will become part of your integrated data flows. This part is not much of a problem if you have relatively up-to-date systems, but if you have old legacy systems, it can involve considerably more work when the integration platform is being built.
A legacy system refers to an outdated system that is still in use, even though its days are numbered. The system is or has been vital to the business, and even though it’s clear it’s passed its expiration date, it lingers on. It cannot be updated, monitoring and security for the system are virtually nonexistent, and integrating it with other systems is something one would prefer to not even think about. As a result, it makes system integration considerably more challenging. If you have a legacy system, developers will need to spend significantly more time on the integration platform, which will affect the price.
There are several more factors, apart from the presence of old legacy systems, that can affect the price of a custom integration platform.
Mixed environment
As a result of mergers and acquisitions, many companies have a mixed environment when it comes to systems and technologies. This means that they have systems from several vendors built with different technologies, which means varying interfaces and data formats for the integration platform to handle.
Global operations with different systems
Similar to the above factor, global companies often have different systems and solutions in the countries they operate in, often for the same purpose. New systems are also often launched in waves, which means that not all countries start using the programs at the same time. This diversity of systems provides a more complex environment with more systems communicating with each other.
Technical debt
Building custom solutions to get things to work as you want is not uncommon and is often done for legacy systems. However, too many quick fixes can lead to difficulties in getting an overview of the systems, and the accumulated technical debt can make integration work more difficult.
All of the above factors contribute to the technical complexity of developing and implementing a custom integration platform – and thus lead to higher costs. Factors such as flexibility, number of business partners and vendors, as well as data volume and traffic volume can also affect the final cost.
As with all types of software development, it is difficult to set a definite price on an integration platform. However, an initiative like this will generally cost anywhere from one million SEK. As always, the work is divided during the development of the solution. Many of our customers also choose to split the work with the platform so that things are built gradually, instead of doing everything at once.
Once the integration platform is up and running, an additional monthly cost may arise for hosting the solution in the cloud, depending on how your current infrastructure looks.
If you are more interested in the benefits of an integration platform, you can read more about it here or contact us.
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