When Companies Do the Mash

Corporations from IBM to Google to E*Trade are jumping onboard the trend of mixing and matching software from different sources

by Rachael King

Richard Hababou scouts out technology deals for the corporate venture arm of French banking giant Société Générale. Yet the nine-hour time gap between Hababou's San Francisco office and Société Générale's Paris headquarters can make communicating about multimillion-dollar transactions a big challenge. For years, Hababou and some 1,000 colleagues have used an online portal where they can collaborate, share documents, and track progress on deals.

As useful as it was, the portal needed a facelift. Hababou wanted to add several features to the deal-tracking application and ditch others. So, in mid-October, he brought in software company ActiveGrid, which added a host of tools, from Yahoo! (YHOO) news feeds to Google (GOOG) Maps to AltaVista's Babel Fish for on-the-fly English-French translation. Best of all, the upgrade took all of three days, compared with the three months it took to build the application at the outset. "It's all the applications I need, but simplified," Hababou says.

That makeover is known in software circles as a mashup, or the combination of disparate software or Web-based applications, often from completely different sources. Mashups aimed at consumers trace their roots at least to early 2005, when Paul Rademacher created HousingMaps.com, a combination of Google Maps with real estate listings from Craigslist (see BusinessWeek.com, 7/25/05, "Mix, Match & Mutate").

Companies Raise Questions

Now, the tools are beginning to take hold with businesses. Companies see enterprise mashups, also known as composite applications, as a faster, cheaper way to create customized applications. Already, companies such as E*Trade (ET), Siemens (SI), JDS Uniphase (JDSU), Pfizer (PFE), GlaxoSmithKline (GSK), and Realogy (H) subsidiary Coldwell Banker Commercial are using enterprise mashups in some capacity.

Yet, mashups are far from a slam dunk among enterprises. For starters, IT executives need to make sure mashups are secure, reliable, and able to be applied on a sufficiently large scale. "It's very difficult for a company like Société Générale to bring in some new technology and put it into production like that," says Hababou. While he was impressed with ActiveGrid's presentation, Société Générale has yet to become an ActiveGrid customer. Many companies are similarly testing the waters. Dun & Bradstreet (DNB), for instance, is testing IBM's (IBM) Enterprise Mashup Maker, also known as QEDwiki.

For any company mulling mashups, there's a growing variety of case studies. Caryn Truitt owns Cookies, a small Seattle shop that sells cookie-baking gear. She keeps track of inventory using an accounting program sold by Microsoft (MSFT). Now that Microsoft has woven eBay's (EBAY) auction tools and PayPal payment service into Microsoft Office Accounting 2007, Truitt can upload items for sale onto eBay directly from her accounting software in just a few mouse clicks. Truitt hadn't sold on eBay before, but it looked so easy that she decided to try it. "It was something I had always planned to look into, but being a small-business owner there are always too many things to do," she explains.

Software Vendors' Services

Other software makers also use mashups to build new tools for business customers. Intuit (INTU) integrated certain Google (GOOG) services into its small-business accounting software package, QuickBooks 2007 (see BusinessWeek.com, 9/14/06, "Google, Intuit Pair Up Against a Foe").

Several vendors offer tools to help clients build their own mashups. These include some of the biggest names in software, such as IBM, SAP (SAP), and Salesforce.com (CRM), as well as newer players Nexaweb, JackBe, ActiveGrid, and Above All Software. A handful of companies—including Salesforce.com, SugarCRM, WebEx (WEBX), StrikeIron, and Rearden Commerce—are creating marketplaces where companies can buy various services that are either pre-mashed or can be easily integrated into existing applications.

Having someone else do the heavy lifting can take a lot of time and cost out of developing just the right set of software tools for a business, says ActiveGrid CEO Peter Yared. "We're about five to 10 times faster than previous technology," he says. Shrinking into one month a project that would otherwise take a programmer five months to complete can save in the neighborhood of $50,000, he adds.

When software becomes easier and cheaper to develop, suddenly it's possible to create many more customized applications than before. Some IT departments don't have the time or resources to develop requested applications that can number more than 1,000. "Previously, you had to have a problem that was big enough to warrant a project manager and five or six months to staff it up," says Dion Hinchcliffe, president and chief technology officer of consulting firm Hinchcliffe & Co.

Adding Resources for Sales

For some, the challenge isn't more software, but less—or at least making better use of existing programs. Many companies sell multiple services to the same customer, winding up with multiple representations of that customer in different databases, sometimes with slightly different spellings. That can make it difficult to offer services like integrated billing or get a holistic view of a customer's activities.

Jefferies & Co. (JEF) wanted a common database for its investment banking customers. So it tapped Nexaweb to build business productivity and research applications that mash up customer information from a common database. "Once you have the data standardized, you can slice and dice it the way you want," says Omer Soykan, a senior vice-president at Jefferies.

Enterprise-security vendor PGP Corp. went a similar route to create a master customer records list. Above All helped PGP mash up existing customer records with standardized company information from Dun & Bradstreet. Now, when salespeople add new accounts, the mashed-up application automatically fills the screen with relevant company information culled from Dun & Bradstreet, saving data-entry time. "The effect was that we got cleaner data," says David Burnett, director of informatics at PGP.