Any budget crunches that hit organizations this year may not directly affect enterprise data management initiatives, but EDM and associated middleware will be called upon to help businesses through turbulent times.My colleague here at the EDM site, John Schmidt, just posted some excellent insights on the importance of middleware and integration in the eyes of executives, especially if a budget crunch were to hit.

As John points out, the business value of middleware and integration would surely be held up for scrutiny if companies are forced to re-examine their IT spending over the coming year. He concludes that while middleware investments represent money well spent, IT and data managers need to do a better job of selling these investments to their businesses. “Integration is perceived as a ‘technical necessity’ rather than a ‘business requirement,’” he cautions.

In fact, as John very astutely points out, issues around building corporate support for middleware and integration run deeper than avoiding budget cuts when things tighten.

Recession or no recession, these are actually upbeat times for technologies within the enterprise data management middleware orbit – from SOA to data warehouses to BI. In fact, many analysts say these areas will likely be unscathed if an economic downturn curtails overall IT spending over the coming year.

For example, Forrester Research predicts that software investments will come through the 2008 slump “in good shape with eight percent growth,” mainly driven by service-oriented architecture initiatives. Software spending in these areas will strengthen even more in 2009, to 11% growth. By contrast, other areas of IT spending – such as hardware and communications equipment – will see less than three percent growth.

Enterprise data warehousing and business intelligence likewise also appear to be ignoring the doom-and-gloom predictions for economy and keep growing through 2008. In fact, Gartner predicts the worldwide market for BI platforms this year will grow by more 11%.

Even within the distressed financial services community – the epicenter of the current economic troubles – many firms still plan to keep buying into enterprise data management middleware and platforms. A survey conducted at the end of 2007 by Wall Street & Technology found that 58% intend to improve data management as a top IT priority, while 42% intend to pursue application integration and business intelligence solutions.

What is apparent from these and similar projections for the market is that as things tighten, businesses are trending toward increasing their reliance on various EDM and middleware solutions to streamline operations and sharpen their competitiveness. This is an opportunity for IT and enterprise data managers to prove the mettle of these new approaches in providing a better view of the business to decision makers, as well as reducing redundant and siloed systems.

It should also be noted that it doesn’t take a slow economy to make such initiatives necessary. In fact, a turbulent economy may merely accelerate the demand for greater flexibility and visibility that EDM and associated middleware can offer.

Here are forces impacting EDM that will likely be accelerated in a turbulent economy:

Greater globalization: Economic slowdowns tend to be regionalized – economists predict markets such as Asia Pacific may not feel the effects of a US downturn. Likewise, North America did not feel the effects of the Asian financial crises in the late 1990s. There will be an even greater emphasis on exporting products and services across borders, as businesses seek to better diversify their revenue bases. Companies will also continue to source international markets for materials and talent at more competitive prices. EDM and middleware initiatives can provide greater near-real-time business intelligence and analytics from various regions of the globe.

Deeper customer engagements: Many consumers may be exercising greater caution in spending. Businesses need better and more informed insights on what customers want and what they will want in the near future. There is now plenty of data within the enterprise to be mined on purchasing patterns. However, even more insights are available from data outside the enterprise walls. More businesses are looking at the Web 2.0 and social networking model for developing more insightful and interactive relationships with customers and partners.

Faster time to market, time to value: A tighter economy demands tighter and better-integrated business processes. For example, slow cash flow could cripple business operations. Typical order-to-cash processes touch a range of processes, from quotation and purchase orders to fulfillment and customer care. A tighter economy will create more demand for better integration and standardization of stovepiped systems and data.

More reliance on automation: In a tighter economy, there will be tremendous pressure to do more with less. There will be an increased push for automation of enterprise data management functions, especially for more route functions, in lieu of hiring and maintaining additional staff members.

Higher-level tasking: As more routine data management tasks are automated, IT and enterprise data managers are going to be increasingly called on in a greater consulting capacity to the business. Managers will need to act more as data stewards versus administrators, working directly with the business to demonstrate the value of key applications to meet new business goals.