Bridge the gap between business and IT

There has been a lot of hype as to the opportunities that a Service-Oriented Architecture (SOA) approach can bring. It has been the ‘next big thing’ for the last 5 years. However, despite the volume of copy on the subject, and the view that this is Business Oriented Architecture, the discussion rapidly turns to Web Services, protocols and standards. There are brief mentions of ‘obvious’ business benefits from agility and flexibility, before deep diving again below the Business Process Layer.

Key challenges
At one level it is easy to describe the business benefits in terms of agility and flexibility. If our business processes are delivered by loosely coupled, autonomous services, then we can easily reconfigure them to change the way we do things. To use a simple analogy it is like the difference between buying a doll’s house, and building one from Lego. It’s easy to modify the Lego house, or even use the bricks to build something completely different. What this means in the business world is, for example, if we want to introduce a new sales channel or customer offering, then we can select the relevant services and put these in place.

Solution
One of the biggest benefits of an SOA approach is that it can bridge the gap between Business and IT. As IT has become more complex and, naturally, as business has become more dependent upon it, managers have struggled to keep up. Many have learnt the hard way not to modify the package solutions and to accept the way they work. SOA offers the opportunity to break up the wall to wall solutions. Business Managers and IT meet at the business process level, with the Business Manager defining the why and what of the process, and IT ensuring the how.

In the long term SOA delivers tangible benefits of agility and flexibility, and lower costs associated with reuse and reduced development time. However, reuse is not confined to new Web Services, but can also be applied to reusing the functionality in existing applications by service enabling and linking these to new processes and new ways of working. This means that SOA can deliver benefits from the outset. For example, if a company wishes to introduce a new online ordering service for customers, this can link to the existing order management application, the inventory system and the credit checking agency all via standardised web services.

Benefits
An SOA approach provides rapid integration of applications, within the company and with trading partners, and supports rigorous transaction control and visibility, which is especially important in a regulated environment. Data can be extracted in real time from applications and turned into a management information dashboard.

Application of an SOA approach can deliver business benefits from:
 

• Increased revenue from new sales and service channels.
• Increased revenue and margin from better customer service, improved intelligence and targeting of products and services.
• Reduced costs from process standardisation, automation and elimination of manual interfaces and rework.
• Increased shareholder value e.g. ability to handle M&A activity, and deliver information for regulatory compliance and investors.
• Reduced IT capital and operating costs.

Having identified generic benefits, it is necessary to identify the right place to start. It is important to have the right governance and strategy for SOA, especially as it is implemented by a programme of projects. The identification and prioritisation of these projects should be driven by the business needs and benefits. Business processes provide the framework, for example, in the form of a Component Business Model, and heat maps, to identify areas of greatest need and opportunity.

Once the governance is in place SOA can be used to start to make dramatic and profound improvements to the way in which IT improves business value and performance.