Understanding the Variety of System Integration Companies: SI, VAR, OEM, ISV and MSP

When a company faces the need to transform digitally and tries to find ways to implement and partners to help with system integration, it steps to the uncharted territory full of confusing terms. The difference between company types is sometimes so subtle and the partnership model is so complicated even for technical experts. Understanding what a system integrator, value-added reseller, independent software vendor, managed service provider and original equipment manufacturer is may clear the fog of uncertainty and help to choose the system integration partner matching your business needs.

The structure of technology partnership

As a business stakeholder, you know that a company can’t take all the markets and sell to one hundred percent of customers. There are various demands, tastes and environments, and one offering is not capable of satisfying them all, especially when dealing with technology. When a company wants to change business processes through digital solutions, it may call for custom functionality to match industry-specific, business-specific or company-specific requirements. Customer expectations drive the development of the infrastructure of resellers, distributors and partners capable of tailoring custom solutions.

What is a system integrator

System integrators (SI) are companies competent in combining different third-party software and hardware components into enterprise-grade systems and possessing capacities to build complex business solutions. Solutions that may comprise multiple technologies, providing consulting, business and system analysis and maintenance and support services according to customer requirements and business needs. System integrators usually serve large-sized companies, industry leaders and enterprises and are not limited by the exclusive partnership agreement from selected vendors or manufacturers. An integrated system consisting of several ready-made software products provided by multiple vendors, custom-developed software, legacy modules and the latest hardware functioning smoothly together to solve business tasks is what a system integrator does.

What is a value-added reseller

Value-added resellers are resellers of third-party hardware and software of a particular vendor or manufacturer that enhance the products they sell with additional services, software or functionality and make these combinations their key business offerings. VARs work in the field that is overlapping in terms of some operational activities with system integrators as they may offer customers some customization or additional functionality. However, the major difference is that such resellers usually focus on a single third-party vendor or on adding business value to just some selected hardware. Also, value-added resellers may be limited by the vertical they operate in or by vendor’s partnership agreements. And they usually concentrate on providing solutions based on specific products rather than on integrating ad-hoc products and solutions compared to system integrators. Customers of VARs are often small and middle-size businesses.

What is a managed service provider

Managed service providers’ key offering is a technology service provided for a recurring fee. Their customers pay for ongoing propositions, including implementation, repair, help-desk support, and everyday administration, etc. MSPs function as IT departments but outsourced ones. Managed service providers usually target small businesses.

What is an independent software vendor

An independent software vendor is a company that owns a solution that is beneficial to use together with software of other technology vendors. ISVs are independent of hardware manufacturers or big software corporations. They produce and sell software for a wide range of end-users. Independent software vendors usually do not develop custom software for another company, they also do not deliver software for a hardware manufacturer, such as drivers. Software corporations usually provide special programs for ISV and authorized platforms to place and sell products. Examples of such platforms for ISVs are Apple store or Google Play and Atlassian Marketplace. Microsoft, IBM, SAP, Cisco, Hewlett-Packard, Oracle, Salesforce and other corporations have such platforms for ISVs.

What is an original equipment manufacturer

Original equipment manufacturers build, embed or package a product of a vendor often combined with a solution from the same or another vendor as a unique offer under some of the vendors' brands. A laptop of a famous brand with the pre-installed third-party vendor’s software is a widely known case of such a partnership.

Pros and cons of partnering system integrators

Your choice of a partner guiding you through the challenge of digital transformation is always based on your business requirements and goals.

The main advantage of all the mentioned types of companies engaged in system integration is that they all will help your business with a solution tailored to your needs. A partner of any type will provide you services beyond and in addition to a primary vendor offering.

On the contrary, primary vendors are focused on the development of their core products and services. They depend on different system integration partners to reach niches, markets and customers that their main offering does not cover.

So having a variety of forms of system integrators, every business can find the best choice, depending on business size and its specialization.

Among the disadvantages of purchasing technological solutions indirectly, the most critical may be the lack of control from primary vendors. On the one hand, a customized solution may help solve an industry-specific task; on the other, this customization may not comply with some standards established by a primary vendor.

And one more thing to point out, if you buy something in addition to a primary vendors’ offering, it will cost you more. It is not a disadvantage. Your business gets additional value from technology working on you, and system integrators would like to get their profit. Does it sound like a fair deal?

We are a consummate IT partner

SYTOSS is a full-cycle and full-stack custom software development company with 10+ years of experience in implementing complex integrated enterprise-grade solutions for several major businesses working in Telecom, Fintech, Real Estate, Shared Economy, Publishing and Digital Commerce verticals. We have tailored over 50 mid- and large-scale software solutions for markets in ten countries. Long-term partnerships and addressing clients’ business challenges is the approach that brings us ninety percent of our repeat clients.

Every digital transformation starts with the new business challenge, and we start solving it with the analysis of the business environment. And if you look for an IT partner to assist you from the very beginning, from the decision that your business requires system integration, we, at SYTOSS, may consult you on available methods, ways and vendors, and develop solutions for your specific needs.