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Information Management Finally Goes Enterprise
CIO Operational Excellence – Built to Run
Service Oriented Architecture (SOA) grew as a technical answer to an age-old question: How do companies gain agility and flexibility – especially in a world increasingly dependent on complex, interconnected IT systems?
Unfortunately, the potential of SOA has been constrained by its very definition. By confining SOA to the realm of IT, opportunities have been largely limited to Service Oriented (Software) Architecture. In 2010, look for SOA to move powerfully outside of IT into business strategy, organization design, and governance models. It’s what some call Service Oriented (Business) Architecture – and it’s a new way to manage the relationship between business and IT. This holistic approach is the essence of Services Thinking.
With Services Thinking, organizations focus on what capabilities each part of the business needs to compete effectively. They then decompose those capabilities into more manageable, independent pieces to enable rapid prioritization and alignment. The solution is operationalized through a series of service-oriented activities tied to underlying information and IT systems.
The technology behind SOA has reached maturity. Package vendors have opened their architectures and supported integration standards, removing the technical barriers to inter-application communications. Forward-thinking organizations are now applying these powerful tools to their overall IT delivery models and to their business strategies. They are finally starting to tap into SOA’s long-touted potential.
History Repeating Itself?
Don’t make the mistake of relegating Services Thinking to the technology domain – especially to the narrow area of Service Oriented (Software) Architecture. The power of the concept lies in applying the principles to the business and to managing the “business of IT.”
| What were the challenges? | What’s different in 2010? | |
|---|---|---|
| Service Oriented Architecture | SOA’s hype cycle was especially steep. Lofty promises were met with disillusionment. Misperceptions remain around the potential and track record of SOA. Misalignment between service-oriented technology and stove-piped business operating models made it difficult to position and govern true technology-enabled business services. Early SOA suffered from lack of maturity in orchestration, security, distributed messaging and processing logic. Limited support for standards across commercial off-the-shelf package players underscored uncertainty and risk. |
The hype curve has moved on to cloud. SOA success stories are quietly replacing the backlash from early experimentation. Services Thinking helps address SOA misalignment – establishing skill-based competencies and a capability-driven business delivery model. Tools and open-standards have evolved – including out-of-the box support from almost every IT vendor in the software, platform and operating environments. |
| IT Services Management (ITSM) | Scope was constrained by design to lower-level technology capabilities. Though ITSM has been adopted by many IT organizations to improve the business of IT, it has not directly addressed the business of the business – strategy, alignment, or agility. | Organizations have the ability and mandate to apply service management principles outside lower-level infrastructure and application support – into other dimensions of IT and business operations. There is a shift toward measuring performance in terms of defined business outcomes and long-term value objectives. |
| Business Process Reengineering (BPR) | Though it promised dramatic efficiency gains, the wave of 1990’s BPR did not have sophisticated technologies to support recommended implementations. The big-bang implementation model made it difficult to selectively address specific capabilities – and challenging to realize positive change in manageable increments. |
Supporting technologies have evolved – with mature tools for integrating and managing information, productivity, collaboration, process automation, workflow and integration. Organizations are able to use an incremental, federated approach to business or functional scope and associated IT elements. Advances in data management and integration mean organizations can retain appropriate pieces of legacy systems in their end-to-end processes. |
Technology Implications
Underneath the business and operational considerations of Services Thinking lie important technology components to support an integrated, agile enterprise. These components are grounded in the idea that organizations live in a service-oriented, event-driven world. Of chief importance:
| Topic | Governance |
|---|---|
| Governance | Business process management Orchestration and automation of multi-step, complex business processes – typically bundled with a business-rules engine for managing logic and workflow tools for managing manual interactions. Enterprise architecture Services Thinking promotes re-use of technology assets across initiatives. This requires processes for shaping solutions and enforcing standards, as well as service registries and asset repositories for managing dependencies across IT components. |
| Applications | Enterprise service bus Advanced integration platforms allow scalable, secure, reliable messaging with dynamic routing and distributed features. This enables process choreography, transformation, mediation and management – ideally through a standards-based approach. Master data management Coordination of core business entities across internal and external business services requires master data normalization and governance. |
| Infrastructure | Extended value Infrastructure in traditional terms supports the services, functions and tools used to execute SOA solutions. In terms of service orientated architectures specifically, there are no major technology implications for infrastructure per se. However, SOA does promote leveraging existing assets and investments. |
Where To Start?
With a broad innovation like Services Thinking, it’s easy to make things too complicated and over-spend up front. That said, it still makes sense to start with the end in mind. Make sure you define the goals and vision sufficiently to guide both initial and incremental investments.
In the year ahead, consider targeting specific functions and processes where the business is constrained because of complexity. Identify compartmentalized, commodity business functions where repeatability and efficiency matter most. By treating these core capabilities as services, companies can expand sourcing options to include out-of-the-box ERP, legacy systems, BPO, or cloud offerings.
In addition, focus on opportunities to drive competitive advantage by improving agility and operational flexibility. These areas require solutions that anticipate and enable frequent change, be it from market or regulatory forces, competitive pressures, or internal innovations.
Once a roadmap for functional scope is determined, move on to foundational layers. Be sure to build in a plan for measuring impact. Many successful organizations adopt a “just in time build-out” model – creating just enough business, organizational, and IT infrastructure to meet early objectives, without diluting future growth. Manual workarounds and governance can be used in many areas up front, though they’ll eventually give way to automation and policy engines. The journey to Services Thinking is marked with a cadence of demonstrated value, even as the groundwork is being laid for future realization.
Bottom Line
By late 2009, most forward-thinking companies had made some investment in SOA – but few had realized the promised outcomes. That’s because the technology tenets of SOA are mostly evolutionary improvements to long-standing software development principles. Same wine, different bottle.
The real potential comes from crossing IT’s boundaries. For Services Thinking to drive real impact, it requires an end-to-end services mentality. Instead of focusing on business process design, shift to identifying, prioritizing, and decomposing services which make up business capabilities. Look at packages and large-scale legacy systems not as black-box absolutes, but as collections of discrete, re-useable services that enable agility.
Lofty ideas? Perhaps. But the major commercial off-the-shelf (COTS) providers are investing billions to make it a reality. That shows that Services Thinking is more than the technology flavor of the month. It’s a smart new way to help drive more business value.
Services Thinking
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