SOA Consortium Insights

SOA Adoption and Value Survey -- MIT’s Center for Information Systems Research

The SOA Consortium continues to build strategic relationships with leading organizations.   Today, we are pleased to extend an invitation from Jeanne W. Ross, MIT Sloan Center for Information Systems Research, to participate in a survey investigating SOA adoption and value.  The survey is open through the end of May and all participants will receive a copy of the results. 

Jeanne’s invitation follows.

“The survey asks architecture leaders to share their views in 4 key areas: SOA adoption, current practices, value and results, and barriers to SOA success. We also intend to understand linkages, if any, between SOA initiatives and company financial performance. Our objective is to help those responsible for architecture better understand how their organizations stack up on a variety of key SOA metrics: investment, progress, reuse, and others.

The survey – which will take 10-15 minutes to complete – is available here.   The survey will be available on line through the end of May.

This survey is a joint effort of MIT’s Center for Information Systems Research and Diamond Management and Technology Consultants.  All responses will be kept completely confidential. Only research team members will know the responses from any organization, and findings will be reported only in aggregate. Of course, you will receive a complimentary copy of the full report."

Please consider participating in this survey.  I'm looking forward to the results, especially on the linkage of SOA initiatives and company financial performance.

SOA 2008 - It's the economy...

This morning’s dismal US Jobs Report and the ensuing analysis  laden with the “R-word” reminded me of a conversation our community-of-practice had on our December 4, 2007 call that I’ve been mean meaning to post on. During that call, prompted by an earlier discussion with Surekha Durvasula, I asked our members the following:

“What does the ensuing (or on-going) economic downturn mean for SOA in 2008? Will the economic downturn and associated budget cutbacks drive organizations to, or away from, SOA in 2008?”

In general, the group on the call spoke of the need for a SOA approach to respond to changing economic (and political) conditions. However, they do foresee changes in implementation investment philosophies, particularly at the resource (application and infrastructure) layers. In respect to garnering investment in tight times, organizations need to approach SOA as a joint business-IT strategy, directly linked to business initiatives.

What follows are excerpts from our call. For member confidentiality, names and organizations are not included. 

Industry practice leader - “It depends on how critical the business direction is that would be inhibited by not doing SOA. In other words, if in order to succeed in the downturn there is a business direction a company has to take that they can’t accomplish right now because of way it is functioning, like it or not, expense or not, they are going to move forward… they might be more selective in how they manage the waves of work they need to do.

I expect to see SOA going forward. Because it is based on – or should be based on -- business value, rather than just technology direction.”

Chief Architect 1 –“In the government sector, a new administration is coming on board. So, a lot of change is coming on many levels. This will create increased spending in IT and SOA specifically.

In the commercial sector, the economic situation might be a downturn mostly from a consumer perspective. Businesses will be looking at emerging and overseas markets to diversify and respond to the dollar bottoming out – manufacturing and portfolio investments. That type of business change is ripe for the development of a SOA approach.

I think we will continue to see SOA. Instead of just composite application development, we’ll see more choreography as it relates to peer-to-peer business interactions. Organizations will open up infrastructure to allow business peers to develop and consume SOA based business services.”

Technology Director – “The financial industry is definitely cutting back. But, other industries, such as telecommunications with the spectrum auctions and Verizon opening its network will continue to invest. As well, enterprises are beginning a rush to Web 2.0 and social networks, similar to the ecommerce rush. With the growth of Web 2.0/Social Networks (Google, Facebook, Yahoo!), enterprises, especially in consumer markets, will need to catch up. Both of these will result in the implementation of SOA. SOA is the backend.”

Industry practice leader – “While SOA will continue to grow, we might see cutbacks related to transformation beneath the services  because that is expensive to do. It’s a bit dangerous. But, I suspect companies might try to limp along – putting services on top of old applications. Depends on how dramatic the requirement is to transform. Such as, is the platform going to die? On the surface there will be services, cutbacks might be lower level.”

Chief Architect 2– “If you are a company faced with global competition or cost-cutting measures, you’ll still be service-enabling. But, I can see a move towards the prior point -- that underlying resource investments (applications and infrastructure) may be put off. Although, that wouldn’t be my preference.”

Business Strategist – “From a business standpoint, I think the downturn and budget constraints may help the SOA cause. I believe that people will look harder at the benefits. From that perspective, people will start to believe in SOA more from a point of necessity.”

Industry practice leader – “In other words from a downturn people will have to be more creative, and will turn towards SOA”

Join our discussion. What is your view on economic conditions and SOA? Please leave a comment, or post with a trackback. Thanks!

Ashok Kumar of Avis Budget and the SOA-C answers "SOA's 6 Burning Questions"

Ashok Kumar, Architect and IT Director at Avis Budget Group and SOA Consortium Co-Chair, answers SOA's 6 Burning Questions in a recent JavaWorld article.  In the article, Ashok shares his perspective on SOA skills, solution performance, security, and generating business value: 

"1. Is anyone saving (or making money) using SOA?

Ashok Kumar of Avis Budget Group says he is. Avis began using SOA about two years ago in portions of the company to open new channels with travel partners. “They can now do direct business with us without having to go through a middleman. So it’s saved them a couple bucks, saved us a couple of bucks,” says Kumar, who is based in New Jersey and is director of services architecture information technology. “The cost of bringing on new partners is down to nothing now because of SOA.”

Avis Budget can now bring on a new partner in a day instead of a month, he says, because with SOA it is just a matter of configuring a service rather than making large application changes. “When we started that the cost of bringing on a new partner was anywhere from $40,000 to $50,000, now it’s down to $3,000 or $4,000,” he says."

According to the article, Avis Budget's success is in the "real money" category:

"There are two kinds of payback with SOA, says Mike West of Saugatuck Technology. The first comes when IT can reduce the amount of money it spends providing services. West believes SOA adoption is still in its early stages, and that perhaps only 10% to 15% of businesses are using SOA and doing it in such a way to save money.

An even smaller percentage of companies are using SOA in such a way that they are improving earnings, he says.

The world is full of projects that can be done quickly and cheaply and offer no long-term benefit, West notes. SOA is a radically different approach to building and managing systems that create a foundation for rapid change, he says.

“The real money gets saved or gets made when you have this flexible business foundation so your business can be more profitable on a top-line basis – not just IT savings being subtracted so the top line is smaller,” West says."

Emphasis is mine.  Check out the full article.

Welcome to SOA Consortium Insights, where SOA Means Business

Welcome to the SOA Consortium Insights blog.  The intent of this blog, written by  SOA Consortium members and leaders, is to promote our core messages around the value and attainment of business-driven SOA.  In addition, we'll use this blog to highlight our working group activities and by-products, industry event participation, and SOA Consortium hosted events.

As the SOA Consortium's Program Director, I'll be your moderator, sharing insights from the working groups and SOA-C activities, and engaging the broader community in conversations around business-driven SOA. 

Expect to see frequent contributions from Richard Soley, the Executive Director of the SOA Consortium.  He is moments away from posting on the SOA-C member panel at last week's Gartner ADI conference. 

Most importantly, our members will make guest contributions here, and the bloggers amongst them will continue the conversation on their own blogs.  See the right side bar for our member blogroll. 

To best express what we mean by 'business-driven SOA', I'll end with an excerpt from our SOA Executive Summit whitepaper we published in April: 

SOA Means Business

All of the CIO and CTO participants were extremely business-focused, and in complete agreement with the SOA Consortium’s underlying premises, that:

• Service Oriented Architecture adoption is a key enabler for the 21^st century enterprise

• Service Oriented Architecture is perceived by business executives as an IT integration and productivity story, but is really a business agility story.

• Achieving the benefits of Service Oriented Architecture requires significant changes for both IT and business executives

21st Century Enterprise, Business Agility and SOA

For the CIO and CTO participants, the 21^st century business environment of globalization, constant connectivity, dynamic value chains, continuous innovation, and incessant change translates to a requirement for increasing both business and IT agility. To meet the agility challenge, these executives are employing SOA principles, practices, and related technologies.

SOA has a Business Story

Although the Summit attendees find the relationship between business agility and SOA to be self-evident, they expressed concern regarding the current industry focus on wire protocols and products, rather than business value generation and the necessary business and IT changes for sustainable SOA success. The industry – vendors, press and practitioners – must “elevate out of the technical weeds” in order to engage the business on SOA.

During an exchange of techniques on “selling SOA”, one CTO recounted early, failed attempts to interest her business executives in “a next generation architecture that provided IT flexibility and code re-use”. Her executives were not interested. Convinced that a service-oriented strategy was right for her business, the CTO changed her approach. She began speaking to business pain points, specifically in terms of business processes, activities, cost, quality and schedules. Gaining executive attention, she then explained how a service-oriented approach resolved these pressing business problems. That time, she received sponsorship and funding.

SOA Success Requires Business and IT Collaboration

For SOA success, securing funding and sponsorship is only the start of business involvement. There must be true collaboration between business and IT from strategy through business solution delivery...

Business-Smart IT Organization

To collaborate effectively, business and IT professionals must speak a common language. Historically, business professionals have been encouraged to increase their IT literacy. This has proven successful at the project execution level. However, collaboration on strategy and architecture is a business conversation first.

“Our entry is always the process and that’s what we actually talk about – how to optimize the process, how to drive the process…When I hear business people talk about systems and they mention System A, System B, System C, I know we’re in trouble. Because basically that means to me is that we are locked into the constraints of the environment.” – CTO during SOA Executive Summit

The CIO and CTO participants encourage business-smarts in their IT organizations. IT professionals, particularly senior leaders and enterprise architects, must understand the business, and be able to relate IT capability to business value generation.