What is Data Integration, its Advantages, and Why is it Important?
Data integration is the process of combining data from multiple sources into a unified system to enable easier analysis, access, and utilization. Timely, secure, and accurate data exchange is crucial for businesses and organizations to coordinate effectively, ensuring our economies function efficiently and at high speed.
Just as content is king when it comes to selling your services, data is queen for making any business decision—regardless of your industry or sector.
While issues with content are often solvable with a bit of good structure and SEO magic, data poses a significantly larger challenge (even though content itself is just a form of data). This is especially true when you need to gather information from various systems.
We’re not just talking about individual systems you might initially think of—such as the data stored across different ecosystems where we work.
Data Integration in the Context of Business
To make timely and sustainable long-term decisions for your business, you’ll need more data than what individuals store on personal devices or in the cloud. Accessing, collecting, and analyzing this data is greatly simplified with the help of IT specialists.
For example, making an informed decision about the profitability of a product (whether new or existing) requires considering a broader context:
- Supply chain insights and associated factors, including external collaborators you might work with.
- Distribution data.
- Integrated billing data from all your payment systems.
- Insights into labor costs, including operational expenses, employee wages, and the cost of systems they use. Often, B2B expenses are overlooked in calculations despite their significance.
- Marketing costs, which are part of a complex process stretching from market research, consumer behavior studies, defining client profiles, and presenting your product.
This is only a fraction of the data you’ll need to make an informed decision about an investment’s profitability.
However, these data points often reside in isolated and poorly connected systems. Attempting manual collection and processing would take years, leaving you with outdated, unusable data by the time you finish. This is where data integration tools become indispensable.
What Does Data Integration Entail, and Why Do You Need It?
Data is stored in diverse locations and formats. To centralize these “data islands”—or silos—you need tools capable of automating retrieval, translation, and structuring. This enables specialists to analyze the data effectively and base their decisions on accurate insights.
The process involves several key steps:
- Identifying data sources: Locate the various databases, spreadsheets, APIs, or other sources you want to integrate.
- Extracting data: Retrieve or process the required data using appropriate tools.
- Mapping data: Align terminologies, codes, or structures from different sources to enable smooth communication between datasets.
- Validating data accuracy: Ensure the data is complete and reliable for seamless system operation.
- Transforming data: Convert and structure the data into a unified format.
- Loading data: Consolidate the processed data into a central repository (e.g., a data warehouse).
- Synchronizing data: Keep your data up-to-date through updates or by integrating new information.
- Ensuring security: Implement mechanisms to comply with data protection regulations, especially when dealing with sensitive information.
- Managing metadata: Provide context and meaning to the integrated data for easier interpretation.
- Accessing and analyzing data: Use analytics tools to interpret the data and make informed business decisions.
Whether your focus is Enterprise Data Integration (EDI)—to combine business system data—or Customer Data Integration (CDI)—to analyze customer insights, these steps are fundamental to any type of data integration.
Advantages of Data Integration
The market for data integration software was valued at $13.2 billion last year and is expected to exceed $30.2 billion by 2030.
While large corporations often lead in adopting data integration, small businesses should not overlook its potential. The digital era, bolstered by advancements in generative AI, generates an unprecedented volume of data.
For context, approximately 328.77 million terabytes of data are produced daily, translating to 120 zettabytes annually. By 2025, this number is expected to rise to 163 zettabytes annually.
Key benefits include:
- Improved Decision-Making: Integrated data ensures consistency, clarity, and accessibility across teams, enabling faster and more informed decisions.
- Cost Reduction: Though initially an investment, data integration reduces operational inefficiencies and long-term costs.
- Enhanced Data Quality: The integration process guarantees precise, complete, and high-quality data for optimal business outcomes.
- Minimized Errors: Automation reduces human error and streamlines repetitive tasks, allowing teams to focus on strategic projects.
- Increased Security: Centralized data storage simplifies data protection, particularly when handling sensitive or regulated information.
How TIS Implements Data Integration
At TIS, we’ve successfully implemented IBM Sterling solutions for clients in finance, distribution, and other industries. These solutions, including IBM B2B Integrator, Sterling File Gateway, and Connect:Direct, offer superior performance, security, and adaptability—whether on-premise or cloud-based.
If you’re interested in securely collecting, processing, and sharing critical data with your partners, contact our Sterling experts for a free workshop to diagnose your data integration needs!
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