Realizing a healthy SOA system to deliver business value quickly

Marie WieckVice President, IBM Middleware and SOA Services

IBM Global Technology Services

HUNGRY FORCHANGE

INNOVATIVE BEYONDCUSTOMERIMAGINATION

GLOBALLYINTEGRATED

DISRUPTIVE BY NATURE

GENUINE, NOT JUST GENEROUS

IBM’s 2008 CEO Study - The Enterprise of the Future Is:

In-depth study taking the pulse of over 1100 CEOs

Global CEO Study 2008 | April 2008 3

The CIO Implications of the CEO Study… Role of CIO as Change Leader Success in a global economy requires diversification and integration

– Mature versus emerging markets– Existing versus new clients

Organizations are recognizing the need to manage differently and invest in new techniques for communications and collaboration – Aging workforce, availability of skilled resources– Explosion of mobile employees– Increased use of global resourcing– Regulatory compliance requirements

Market demand for corporate social responsibility is forcing a hard look at ‘green’ IT – Global energy crisis– Exponential growth in data volume, network sprawl and mobile devices– Aging data centers

….the compounding effect is forcing change

SOA is a Core Enabler of the Enterprise of the Future

1. Hungry for change

2. Innovative beyond customer

imagination

3. Globally integrated

4. Disruptive by nature

5. Genuine, not just generous

Core Traits How SOA Can Help?

Source: IBM Global CEO Study 2008

SOA improves business agility and increases IT infrastructure flexibility

Customer Interaction and self-service are among the top SOA projects with rapid ROI

SOA is a best practice for horizontal business integration within the enterprise & externally with customers and partners

BPM is a key SOA technique for business process/model assessment and redesign

SOA services for dynamic IT management enable NEDC/Green tracking

Three common business goals and related SOA benefits

Providing new services to customers and/or partners Benefit: increased revenue from new channels and

services

Attaining a single view of the customer Benefit:

– Higher customer satisfaction– Higher revenue through better cross-sell/up-sell activities and

customer loyalty/value/buying habits analysis

Integrating and automating processes Benefit:

– Faster process cycle times– Alleviation of manual intervention and its associated errors– Lower costs for maintaining redundant systems supporting redundant

processes– Faster time to market with newly acquired services

HUNGRY FORCHANGE

GENUINE, NOT JUST GENEROUS

INNOVATIVE BEYONDCUSTOMERIMAGINATION

GLOBALLYINTEGRATED

DISRUPTIVE BY NATURE

Foundational ExtendEnd-to-End Transform Adapt

Dynamically

Experience based on 6550 customers across Smart SOA**# of Customers using our SOA offerings*# of Customers using our SOA offerings

750 Lessons Learned 650 Best Practices

IBM Academy of Technology deep dive analysis of 100 case studies selected from over 250 submissions:

Valuable regardless of Where You Are in the SOA Continuum

SOA Best Practices White Paper Now Available

Smart SOATM leverages IBM’s client experiences Driving the transformation of SOA Services

Follow Proven Best Practices

Linking business and IT

from the beginning

Develop an architecture with a vision for the

future

Maintain end-to-end operational

visibility

Built on skills within culture and governance

Scalability and process

integrity are key

Aberdeen Group Study: Organizations not adopting SOA- Can’t justify the investment or don’t have the skills

18%

18%

13%

20%

28%

53%

0% 10% 20% 30% 40% 50% 60%

We don’t see a need to move toSOA

We are not convinced about thebusiness value of SOA

Doesn’t fit our environment

We’re waiting for our mainvendor to lead us

The IT organization does nothave the capabilities required for

SOA implementation

We cannot justify the initialinvestment required for SOA roll-

out

18%

18%

13%

20%

28%

53%

0% 10% 20% 30% 40% 50% 60%

We don’t see a need to move toSOA

We are not convinced about thebusiness value of SOA

Doesn’t fit our environment

We’re waiting for our mainvendor to lead us

The IT organization does nothave the capabilities required for

SOA implementation

We cannot justify the initialinvestment required for SOA roll-

out

Source: How SOA Is Changing IT – What CIOs Should Know

Aberdeen Group

IBM can help build a business case to establish and measure the ROI and value gained

A step-by-step approach that is:

Demonstrable

Quantitative

Focused on Metrics

Flexible

How to build a case for improvement?

1. Determine the area for greatest impact- Benchmark against others in your region or industry

- Align to business initiatives

- Determine Savings others have seen

2. Determine your state of maturity

3. Determine the savings metrics for your organization- Risk Adjusted Return on Investment (RA ROI)

- Return on Investment (ROI)

- Net Present Value (NPV) savings

- Internal Rate of Return (IRR)

- Payback period

4. Create your own business case based on your data

IBM can help you establish target KPI benchmarks for the project with the IBM Benchmark Wizard

Based on real client experiences

Allows for industry specific views

Provides real average results and target benchmarks

Covers multiple project domains

Cost, time, efficiency, quality and agility metrics

SOA deployments are delivering measurable returnsCompanies globally are realizing . . .

An electronics company reduces IT Costs by 7% by

deploying a flexible SOA infrastructure

A major Bank estimates avoidance of US$1 billion in IT costs due to SOA approach

Retailer of home improvement products •Has 286% ROI on SOA project

Municipal government improves citizen services via SOA integration of 27 departments’ application platforms

Automotive company expect20% cost reduction of IT Operations during next 5 years due to new SOA Infrastructure

University increase collaboration, responsiveness and student moralfrom Portal and SOA integration

Insurance company reduces application integration cost

by leveraging SOA integration

A chemical and petroleum company• 5 percent increase in oil and gas production •30 percent reduction in costs

Leveraging SOA to deploy multi-play solutions

Connect 10M customers in 910 cities and extend reach to rural areas

Extend multiple services across new, connected broadband network

single touch activation capability from time of ordering to activation of subscriber services : customer satisfaction call center load

Scalable network to handle 50% growth

Leveraged IBM SOA Integration services

MOST IMPORTANTLY - BSNL GIVES BACK TO THE COMMUNITY

At affordable price high speed connectivity to the most rural parts of the country

Provides opportunity to consumers to collaborate and learn

Methods to deliver remote education over secure VPN

Design Projects with the SOA Reference Architecture

Business Services

Dev

elo

pm

ent

Ser

vice

s

Ser

vice

Man

agem

ent

Infrastructure Services

Enterprise Service Bus

PartnerServices

Business App Services

AccessServices

InteractionServices

ProcessServices

InformationServices

Infrastructure

Establish and Maintain your SOA Health

Service Use and Governance

Application ReuseSecurity

FlexibleInfrastructure

Middleware ServiceManagement

Applications and Services Healthchecks

for SOA

Infrastructure Healthcheck for SOA

WorkshopsAssessmentsSpecialized Diagnostics

Infrastructure Architecture Healthcheck for SOA

SOA architecture decision acceleratorFaster time to value, less risk through proven recommendations

Repository of Architectural Decisions

– Decision Tree based

– Navigation/search by role, project phase, scope, etc.

– Decision identification and making based on prefilled alternatives

Patented web 2.0 approach

– Governance on accepted architecture decisions

IBM Global Services architecture decision accelerator for SOA

- 100 practitioners involved- Over 320 decisions captured

Architectural Decision Knowledge Wiki for Clients

– Web 2.0 tool & model for capturing decision available on alphaWorks with 20 sample decisions: http://www.alphaworks.ibm.com/tech/adkwik

– Can address any IT domain including SOA

Process Integrity for the Stresses of Volume and Time

• WebSphere Virtual Enterprise• WebSphere eXtreme Scale• SOA Integration Services

for Process Integrity

White Paper: “Realizing business value from an integrated service-oriented architecture system in a multivendor world

IBM SOA Integration Services -– Connectivity and Reuse

Create a robust, scalable runtime SOA infrastructure that can effectively enable and support SOA applications and Web services

– Portal Infrastructure ServicesDesign and implementation services to engineer an

integrated, flexible and reusable portal infrastructure to support Web, SOA, and Java applications

– Web Application ServerEngineer an integrated, flexible and reusable application

infrastructure that supports Web, Java or SOA applications

– Web Optimization and VirtualizationOptimize and virtualize a client’s IBM WebSphere

Application Server and non-IBM application server

IBM Global Technology Services announces:IBM SOA Integration Services for Process Integrity

Process Integrity In Action: Order Management

14,000 Service-Calls/Min

100,000 completed

orders / DayThrough WebSphere

Process Server

Services from Customer Management, Provisioning, & Billing Systems

Major EuropeanTelecomCompany

New economics

Rapid service delivery

Aligned with business goals

The New Enterprise Data Center – built on an SOA infrastructure

IT energy use doubling every 9 – 24 months

By 2011, clients will spend $1 on power

& cooling for every $1 on hardware

100 units of energy production 3 units for productive IT

IT accounts for 2% of anthropogenic CO2 emissions

IT energy crisis has data centers at a tipping point

Stages of Adoption

Drives IT efficiency

Rapid deployment of new infrastructure and

services

Highly responsive and business goal driven

This transformation spans across people, process, information . . . and technology

Skills shift from operations (break / fix) to IT Business Analysts

Break down silos and organize around IT service delivery

Paradigm shift toward shared environment

Standardization Disciplined Repeatable and documented processes

– Change and configuration management– Process automation

Leverage information for business optimization

– Deliver trusted information real time and in context

– Reduce risk and improve visibility into business operations

Open standards– Open management across server,

storage, and networking– Open networking standards

Role of systems & networking in recentralization

Automation

Our experience points out 5 key “focus areas”

Focus Area / Pain Points

Infrastructure Health Check for SOA

Infrastructure Readiness Assessment for SOA

Simplify & save money

Virtualization / Consolidate

Relieve constraints

Green

Business compliance

Business Resiliency /

Security

Deliver quality service

Service Management

Priority:

Getting Started:IT Optimization Strategy & Planning

Virt./ Consolidation Assessments

Data Center Energy Efficiency Assessment

Data Center Rationalization Services

Security Assessment

Resiliency Assessment & Planning

Service Mgmt Strategy & Planning

Business of IT Exec. Dashboard

Decouple application logic

from infrastructure

Flexible Infrastructure

for SOA

IBM Data Center Evolution

Dramatic reduction in operational costs thru consolidation, virtualization, optimization

Project Big Green

2X capacity, no increase in consumption or impact

$1 saved on energy $6-$8 operational savings

The New Enterprise Data Center

Increased quality of service delivery

ROI of less than 2 years

A service oriented approach to data center design

IBM’s own data center transformation1997 Today

CIO’s 128 1Host data centers 155 7Web hosting centers 80 5Networks 31 1Applications 15,000 4,700

• Provision new services in minutes

• Triple asset utilization

• System outages down 58%

• Reduce floor space by 80%

• Reduce power usage by 40%

• Up to 60% heat reduction

Results customers have realized *

IBM Service Management for SOA

Monitor SOA Services, Events

and Dependencies

Visibility Control Automation

Provide Secure and Compliant Quality SOA

Service Delivery

Support Dynamic Runtimes and

Service Lifecycles

IBM’s Service Management Capabilities Combined expertise in service management and SOA

Strategy and planning creates an approach that’s aligned with business objectives

Design and implementation is based on a proven approach and framework

Proven reference architectures and leading practices accelerate the design process

Driving results (on average)

• 58% reduction in System Failures

• Downtime reduction of 80%

Design Implement Run

Managed servicesIT Asset ManagementHelp DeskSelf-enablement portal

Business of IT executive workshop

Service management design

Service management strategy and planning

Service management implementation – accelerators for service and asset management

Business of IT dashboard

Service management implementation services

Strategize and plan

Clients describe the key benefits they derive from leveraging IBM implementation services

Productivity Improvements 28%

Quality Benefits 39%

Labor Savings

33%

•Quicker Time to Benefit

•Labor Savings

•Quality Improvement

•Process Savings

•Performance Enhancement

“Thanks to this new

information, never before

available, we were able to

dramatically demonstrate

the importance of

improved monitoring and

management of the

airline’s IT systems to the

business side of the

enterprise.”Masayuki Kurosawa,

Vice President, IT Service and Planning

Major airlines reduces IT outages to improve operations Combined expertise in service management and SOA

Dramatically improved overall quality of service - reducing system failures 58 percent, IT interruptions 39 percent, and downtime 80 percent

Improved overall quality of service by reducing outage-related operational delays

Provided JAL management with greater understanding of how IT affects its business through unprecedented visibility into the current state of its IT systems

Summary• Companies in every industry are exploiting

advanced technology to gain competitive advantage

• Infrastructure and information complexity are driving a change to Service Oriented Architecture and leveraging Agility to drive Innovation for the business

IBM has the experience and knowledge to

help you realize more quickly the full value

of your SOA deployments

Today's Business Landscape is Undergoing Rapid and Transformative Change

Are you prepared?

Thank you