Think business transformation, not code reuse

The worst CIO misunderstanding about service-oriented architecture (SOA) is thinking of it as only another technical initiative for software reuse. Although SOA's reuse potential is real and good, its business impact goes much further: In Forrester surveys, 38 percent of Global 2000 SOA users say they are using it for strategic business transformation. SOA's true source of power is in its business design models, not its technology - and this means that SOA provides a broad foundation for a much larger shift in business technology (BT) architecture that goes far beyond SOA itself. By correctly understanding SOA, CIOs can lead their organizations on a solid and well-managed path toward a strategic technology future and greater business value.

Forrester defines SOA as a business-focused approach to solution design and software architecture. By providing open, flexible access to the business capabilities and transactions buried within an organization's applications, SOA makes it easier to adapt existing software to new business requirements. CIOs who think of SOA merely from a technology perspective will miss this business view of SOA, and they'll miss an opportunity to lead their organizations forward. SOA is the foundation of a much broader shift in the future of business-focused IT architecture, which means that those who get SOA wrong will have a poor business foundation for many years to come.

Sixty-eight percent of enterprises say they are using SOA or will be using it by the end of 2010. Fifty-six percent are using SOA now, and that number jumps to 74 percent when considering only Global 2000 organizations. All this SOA usage is not just industry hype and experimentation, either. SOA has been delivering tangible results that make IT executives want more of it: 52 percent of current enterprise SOA users say it has delivered enough benefit that they plan to expand its use, while only 1 percent of SOA users say they are cutting back on SOA because they see little or no benefit. For the rest, it's either too early to tell or they are struggling to get the benefits - often because they approach it as only a technology.

The key points CIOs must understand about SOA are:

• SOA aligns your software with your business. While it is true that SOA is fundamentally an approach to software architecture and design, which makes it sound tech-oriented, the most important SOA concept is to design software around the business capabilities you need to run your organization. Each SOA-based business service performs a complete business unit of work, hiding the complexity of your IT applications behind a pluggable digital software interface for a specific, targeted business capability such as "submit order" or "distribute sales lead."

• SOA creates a portfolio of business capabilities. By designing for the business capabilities your organization needs, a business-oriented approach to SOA creates a coherent portfolio of business services that directly reflect the design of your organization's major business transactions and processes. These services build upon and leverage your existing base of siloed and overlapping applications, insulating your business from the existing complexity by providing a service layer where business alignment is built directly into your software.

• SOA brings business capabilities where they are needed. With a portfolio of SOA business services, your organization can quickly connect your business capabilities to any business process, employee, customer, partner, supplier, government entity, mobile device, or anything else as needed to adapt to changing business conditions and implement business improvements.

There's more: SOA's business services provide a foundation for further innovation and business optimization. Four examples include:

• BPM for business responsiveness. Business process management (BPM) and business activity monitoring (BAM) solutions can use the business data flowing through your SOA services for business visibility and rapid response.

• Event processing for early warning. Event processing solutions can identify patterns in business service flows to provide early warning for potential business problems.

• Predictive analytics for action that anticipates future problems. Predictive analytics can operate over near-real-time flows of data from your SOA services or data services, or from event streams flowing through SOA infrastructure to event-processing solutions, to predict future business problems from patterns that emerge from mathematical modeling of system behavior.

• Rules and policy for business flexibility. Business rules and policy management technologies can provide the means to quickly adapt the operation of the digital business represented by your business services.

There is benefit in SOA itself, and there is further benefit in the foundation for business process intelligence and adaptability that SOA provides. It is not simply about using SOA together with other technologies: Unless SOA is the foundation of a larger architectural vision, adding on other technologies only creates more technology integration issues. Building on top of SOA, Forrester integrated vision for Business Capability Architecture, Digital Business Architecture, Dynamic Business Applications, and more embody a future where the architecture of your solutions matches the design of your business. SOA is the foundation for achieving a broader strategic future.

Randy Heffner is a vice president at Forrester Research, and is a leading expert on architectures and design approaches for building enterprise applications that are secure and resilient in the face of continuous business and technology change.