Intelligent Enterprise

In an article two years ago, I wrote that service-oriented architecture (SOA) was technobabble, not strategic technology. In 2006 I noted that SOA was moving beyond chatter. Well, in later May IBM hosted Impact 2007 – an SOA event where people finally talked about it not only from an IT perspective but as real customers who have used SOA to deliver business value to their organizations. That’s good progress. Also CIO Magazine recently did a survey that found that CIOs who have embraced SOA earn higher compensation and have larger budgets as a percent of company revenue than those who do not support it.

So something is finally happening. We are starting to see software utilizing SOA technology and architectural principles. And the first wave of early adopter organizations is demonstrating their promise and potential. Are you ready for it?

Just about every vendor claims to have an SOA “solution,” but many organizations still are not sure what to do with it. The rationale for moving to SOA is obvious – to connect business more nimbly with its processes, information and people. But getting there from many established IT environments isn’t easy. I have seen many organizations struggle to adapt their IT planning to a service orientation. A decade of developing GUI-based applications for the Web, along with buying and deploying application suites for enterprise resource planning (ERP) and customer relationship management (CRM), have left little room for reuse and the design principles of SOA.

No one has the budget to SOA-enable everything, but evolutionary steps can gradually modularize your systems for more streamlined IT and business efficiency. Keep in my mind, however, that in the short term, some of your existing information technologies will not interoperate in an SOA environment. About 60 to 70 percent of IT budgets are spent on labor, so companies we must find methods for improvement. SOA can build repeatable processes and reuse of developed interfaces and components of applications to help escalate new applications or changes.

SOA has come a long way in two years, from technobabble to business-based discussion about refocusing existing IT investments and providing systems and applications that can accelerate the efficiency of your business processes. The question is whether SOA software from IBM, Oracle, SAP and other providers can really work together without significant integration and interfacing – more systems complexity when organizations would like less. I will be keeping an eye out for examples of this really happening.

Let me know your thoughts.

Mark Smith is CEO And Senior Vice President of Research at Ventana Research. Write to him at mark.smith@ventanaresearch.com.