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Cloud-first strategy speeds spinoff of American Express' travel unit

Given just months to spin off a $20 billion operation into a new, independent company, American Express Global Business Travel turns to the Dell Boomi cloud integration platform.

American Express famously admonishes its customers, "Don't leave home without it." For its recently spun-off global travel business, however, the newly independent company had no choice but to leave nearly all of its IT systems behind.

The challenge of moving out and setting up a new IT operation was not an easy one: When American Express spun off a 50% interest in its business travel unit in 2014, the massive new entity was something rare -- a startup built upon on a cloud-first strategy, with $20 billion in annual revenue and operations in nearly 120 countries. It's not your ordinary to-the-cloud migration. The challenge was surmounted, in part, through the implementation of the Dell Boomi large-scale enterprise integration platform as a service (iPaaS).

Prasant PanickerPrasant Panicker

"We had just months to stand up a clean slate of all new enterprise corporate systems for HR, payroll, procurement and finance, and get them to talk to each other," said Prasant Panicker, director at American Express Global Business Travel -- GBT for short, with the American Express name now used under license. "This had to be a complete break from American Express." Those corporate applications were tackled first, with customer-facing travel applications slated to be dealt with in a later phase.

The drive to implement similar migration projects is gaining momentum. According to a December 2016 study published by MarketsandMarkets, the worldwide iPaaS market is forecast to hit $2.99 billion in 2021, up from $528 million in 2016 -- an impressive compound annual growth rate of 41.5%. Aside from business agility, scalability and cost-savings benefits, a key growth factor cited by the report is an increase in awareness of iPaaS capabilities among enterprises

Cloud first, but not cloud only

Like any contemporary startup, going cloud only was deemed the most desirable strategy for GBT. However, that notion turned out to be impractical, Panicker said. This was, after all, a travel company with considerable legacy baggage.

GBT's suite of internally developed, proprietary, legacy applications, all designed in the precloud era, were not suited for cloud migration due, in part, to their design and the high transaction volumes they generate. Consequently, they continue to run on premises.

Brett StinemanBrett Stineman

"There's a lot of IT built into those legacy applications," Panicker said. The entire portfolio of core travel applications also runs on premises for now.

It is on the administrative side where a cloud-first strategy came into play. The software-as-a-service HR, payroll and other applications GBT chose are all cloud-hosted by their respective providers. Yet, they all had a need to interact and share data -- the very definition of iPaaS.

IPaaS is a way to help organizations move, manage and govern data that is crossing different applications, different systems and different data stores.
Brett Stinemandirector of product and partner marketing at Dell Boomi

"IPaaS is a way to help organizations move, manage and govern data that is crossing different applications, different systems and different data stores," said Brett Stineman, director of product and partner marketing at Dell Boomi, based in Berwyn, Pa.

As part of their digital transformations, businesses are not only migrating to cloud computing, but also creating multichannel applications, along with efforts built around communities and connected devices, Stineman said. The result is a compounding of needed connections.

"Organizations that are trying to get these diverse systems and apps to work together often attempt a homegrown, coding-based approach that requires development of many individual connectors," Stineman said. "What iPaaS does is provide a single-pane-of-glass, unified approach to managing all of those integration and connection points."

Massimo Pezzini, a vice president and fellow at Gartner, agreed. "By 2019, I believe iPaaS will be the integration platform of choice for new integration projects," he said. "It will overtake more traditional, software-based integration."

Large-scale undertaking

Implementing the mammoth migration to the cloud followed by developing a series of interconnection pipelines in a short timespan required both a large-scale enterprise integration platform and cool heads. Fortunately, Panicker, it turns out, was no panicker.

"Making a completely clean break with American Express provided us with an opportunity to adopt a cloud-first strategy using a greenfield approach," Panicker said. "But, to do that, we needed to find [an]  integration platform to service our immediate need of having these different cloud apps to talk to each other."

A second major consideration played into the cloud-first strategy for administrative apps. "HR and payroll do not differentiate us in the marketplace, so there was no reason to invest critical IT resources developing those applications," Panicker said.

Following consulting engagements with Forrester Research and Gartner, GBT ultimately chose the Dell Boomi enterprise iPaaS. Key considerations, Panicker said, included the availability of ready-made connectors for the hosted apps being used, quick time to market, scalability and security.

Having survived GBT's cloud migration puts Panicker in a position to offer advice for others in a similar situation. "You need to have a good understanding of your landscape and use cases," Panicker said. "We did that by making a full inventory of all our use cases."

API and iPaaS will meet more frequently

Just as businesses like GBT continue to advance the demand for melding cloud migration and integrations is a single mesh-like project, IPaaS technology itself is moving ahead. Not surprisingly, all roads eventually lead to API technology.

"API management is an area that will become synonymous with iPaaS," Stineman said.

Pezzini characterized iPaaS as a key enabler for API strategies, ultimately driving expansion of the so-called API economy. "APIs are implicit to facilitating digital, mobile and IoT [internet of things], and API-first integration is increasingly in vogue.”

Joel Shore is news writer for TechTarget's Business Applications and Architecture Media Group. Write to him at jshore@techtarget.com or follow @JshoreTT on Twitter.

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