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HOW TO BUILD A SERVICE-ENABLED DIGITAL ENTERPRISE

APPLICATIONS WHITE PAPER

JANUARY 2017

A SERVICE-ENABLED DIGITAL ENTERPRISE IN FOUR STAGESAs digital technologies transform every industry, organizations understand that they must embrace digital innovation to create and sustain competitive advantage. From banks and insurers to manufacturers and healthcare provid-ers, companies see the benefits of going digital, and they see their customers expecting the kinds of services that digital technologies can help to provide.

The challenge, of course, is that many of these companies are heavily invested in previous generations of IT, and their applications are running on older platforms, older systems and older networks. Plus, getting to digital isn’t simply about adopting new technology components — software, devices or some other clever technology. It’s about embracing an entirely new business model that allows real-time collaboration among all parties within new business ecosystems.

Any modernization strategy has to take all this into account. CSC has developed a four-stage, trimodal approach to building a service-enabled digital enterprise that reduces complexity and cost, while enabling a more agile infrastructure and modern applications (see sidebar, “From Bimodal to Trimodal”). Our trimodal, or three-track, approach will:

• Accelerate your digital transformation

• Create new business value through deft use of digital innovation

• Exploit changing market and business opportunities through continuous delivery

• Increase business insights and consumer experiences by mining data and information with advanced analytics

STAGE 1: DIGITAL VISION

A digital vision can deliver the agility a business needs to align with rapidly shifting market trends and expectations, so as to meet the needs of ever-more savvy and demanding customers. There are two primary considerations in establishing a digital vision:

• Becoming more effective through business model reinvention, enabled by the “create the ecosystem” track (2) (see sidebar)

• Becoming more efficient through business process optimization, enabled by the “select the platform” track (1) and “connect the legacy” track (3)

Sets the foundation for successful application

transformation

Business-led approach to transform application

portfolio and infrastructure, including a comprehensive roadmap and business case

Adapt processes, procedures and governance for new cloud-based agile IT

environment

DIGITALVISION

DIGITALSTRATEGY

DIGITALTRANSFORMATION

PLAN

DIGITALTRANSFORMATION

2 | HOW TO BUILD A SERVICE-ENABLED DIGITAL ENTERPRISE

FROM BIMODAL TO TRIMODALCompanies often talk about a “bimodal” approach to IT. Mode 1, traditional and sequential, is focused on cost, risk mitigation and compli-ance. It preserves everything good about current systems. Mode 2 is a more adventurous strategy, epito-mized by a continual reinvention of business and policies. The risk of Mode 1 is obsolescence; the risk of Mode 2 is throwing out the known for the unknown.

The differences between Mode 1 and Mode 2 can be reconciled with a trimodal strategy:

1. Select the platform. Use a foundation through which all the key internal and external resources (people, places, objects and information) can come together to create business value. Subject to an agreed-upon governance model, the platform allows everyone and everything to share business value. This stands in contrast to the old business model where value is created and pushed to customers.

2. Create the ecosystem. Key resources (people, places, things and information) interact in a way that delivers significant business value. Value may be generated outside an organization, across and/or within the business boundary. The ecosystem is a dynamically configurable, net-work-based value chain that can respond fluidly to transient events. This is a major change for many companies.

3. Connect the legacy. All business value in existing systems is unlocked and made available, under controlled conditions, to the ecosystem. Often, information unlocked in this way can be mined to gain further business insights and provide additional value.

This three-track approach is well suited to your company’s journey to a service-enabled digital enterprise. The journey itself takes place in four primary stages (Figure 1).

Figure 1. Four-stage framework: Journey to the service-enabled digital enterprise

Create the Ecosystem Through Business Model Reinvention

Businesses traditionally have used a provider-to-consumer (push) model, in which IT helps the business deliver its goods and services. In this model, IT includes systems of record (Enterprise Resource Planning [ERP] systems), transaction-processing facilities (e.g., mainframe banking software and custom applications to implement specific functions) and user interfaces. The value of IT has been measured in terms of its ability to satisfy the specific needs of the business — not necessarily the needs of the customer.

In the digital era, the proliferation of mobile devices and cloud-based consumer apps has changed the focus of IT from the business to the consumer. Products and services are now valued by new measures of customer reaction and satisfaction, such as the ease of a transaction, personalization of services or ability to track the shipment progress of recent purchases.

It’s no wonder, then, that IT systems originally designed to meet the needs of the business are ill-prepared to meet the entirely new requirements of the digital consumer. In the mobile-enabled digital era, traditional business models are no longer seen to be as relevant as they once were, and consumers are much more ready to switch to newer digital providers. Business effectiveness now demands that companies deliver the right value at the right time at the right price to ensure a wonderful user experience. In the digital era, this is the only way to create and retain customer loyalty.

To deliver the experiences digital consumers demand, organizations must reinvent their business model, joining a broader collaborative ecosystem of providers that are connected through a modern platform extending well beyond simple traditional IT platforms.

Amazon Marketplace sellers serve as an example of an ecosystem-based digital business model. While often maintaining their own websites, Marketplace sellers use the Amazon platform and supply chain processes to offer the same products and services. For a fee, these ecosystem members connect to a wide, loyal Amazon customer base. They gain integrated access to credit card companies and PayPal, as well as shippers, independent product reviews, and more. These features enable them to offer a better customer experience than they could deliver alone.

Creating or operating within such an ecosystem requires an integration-first strategy, which we’ll discuss later.

Select the Platform and Connect the Legacy Through Business Process Optimization

In the digital era, the ecosystem and information surrounding a product may be as valuable to the consumer as the product itself, providing insights into the value chain and opportunities for business process optimization.

For example, what motivates a consumer to purchase one perfume over another? The decision-making process may be based as much on ancillary factors as on the product itself — the product’s origin (e.g., “green credentials”), celebrity endorsements, social media comments and where it might be found in stock. Today, 50 percent of a tomato’s price is based on its associated product data. Consumers want to know where the tomato was sourced, whether it’s organic, its freshness, health value, etc. This information is often available only by capturing process information and data from other value providers within the supply chain ecosystem.


THE ART OF THE POSSIBLEThe digital vision part of the frame-work (Figure 1) is where firms can consider all opportunities to reinvent and optimize a business to operate efficiently and effectively within modern digital ecosystems.

Example 1: Leveraging IT Within a Digital Business Model

While the business fundamentals of “doing the right thing and doing it well” haven’t changed, the ability to leverage IT within a digital business model takes these aspects to a whole new level. Combining real-time sensor data with service-related information such as part numbers, stock levels, suppliers, location information, test procedures, etc., a trucking company can optimize the value of its truck by maximizing road time and on-time delivery, while minimizing breakdowns and downtime.

Example 2: Creating an Omnichannel Experience

Business processes often deliver a monochannel experience rather than a collaborative, coherent response. Consider a modern banking scenario: Banking customers want instant access to records, or the ability to apply for a loan on a Sunday night via a mobile device and learn instantly whether they are approved. Nimble, digital-only banks — with no brick-and-mortar operations — are rapidly emerging to satisfy this consumer demand.

The solution for an established bank is to provide consumers with an omnichannel experience in which time-based contextual information is persistent and properly leveraged to optimize the user experience, regardless of device, time or engage-ment method adopted (e.g., mobile device usage, visit to store, Internet, virtual assistant, etc.).

STAGE 2: DIGITAL STRATEGY

Select the Platform

Once you’ve established your digital vision, you will need to select the modern platform that will digitally connect your business with others, allowing you to collaboratively build products and share services within the wider ecosystem, rather than just within the confines of your own firm. Application platform technology in the cloud offers new opportunities to develop and deliver the multichannel apps and services that can accomplish these goals.

Two aspects of platform technology are of specific interest:

1. Development Platform as a Service (DPaaS). Driven by the business need for rapid, agile, continuous delivery of new products and services

2. Integration Platform as a Service (iPaaS). Driven by the need to support distribu-tion of services and interoperability and connection of value chain processes across the ecosystem

The platform should be seen as the foundation of digital business, but unlike traditional building foundations, it doesn’t need to be procured and constructed as a fixed asset. Rather, it can be consumed as a service to meet the evolving needs of the business.

CSC’s DPaaS supports DevOps principles, provides multiple technology choices and integrates with the CSC Agility Platform™ for automated deployment.

CSC has implemented new digital business models for our clients via an integration-first approach that leverages modern iPaaS technology, such as that from MuleSoft. Initially, many clients tend to focus on physical integration issues, perhaps a holdover from the days of middleware. However, digital business requires the integration of business processes and data across an extended value chain, as well as business process orchestration and not just physical connectivity.

Business process orchestration is a component of iPaaS that centrally coordinates the execution of different services involved in the overall operation. The advantage of the iPaaS/business process orchestration architecture is that the constituent services do not need to know they are contributing to a higher-level business process. This means that services can be made smaller, more modular and efficient and can be orchestrated in different ways to meet the changing needs of the business. This is a key factor in providing business agility — that is, the ability to quickly adapt to changing needs and circumstances — and building the service-enabled digital enterprise.


Figure 2. Essential constituents of a DevOps IT platform

RTRequirementsTraceability

ATAutomated

Testing

CIContinuousIntegration

WGWorkflow

Governance

CDContinuous

Development

CMContinuousMonitoring

OMOperationalManagement

In a series of in-depth position papers CSC details the technology shifts driving digital transformation. Learn more at csc.com/digital.

Create the Ecosystem

Once you’ve established a modern platform to enable your digital business journey, creating your business ecosystem will become an evolutionary process that will focus on one or more of the following strategies:

1. Business Model Reinvention to Fit Your Business into a Digital World. Reinventing your business model spurs innovation, which enables you to introduce new or enhanced solutions and improve consumer experiences more quickly. This strategy typically focuses on enabling the exchange of value across the business/partner ecosystem to deliver better products and services and to provide ubiquitous anytime/anywhere access to business functions. Security between and across business domains is an important factor to take into account.

2. Business Process Optimization to Create New Value in a Digital World. Modern business processes are designed to connect people, places and things to create new and more valuable business process threads across the ecosystem. The goal is to enable the creation of new, more valuable products and services, including those involving nonhuman users, such as smart devices. Business process optimization will encompass supply chain efficiencies and steps to improve the omnichannel user experience.

3. Adaptations to Exploit Changing Market Opportunities. The modern ecosystem must be able to respond to rapidly changing market conditions. Retailers could respond to seasonal events or climatic conditions in new ways. Agricultural companies could alter growing conditions or crops in response to changing weather or market circumstances, or they could respond to crop infections.

4. Analytics to Improve Business Value and User Experience. Omnichannel processes and applications can integrate new sensor technology or data sources with back-office data. For example, capturing trends and user feedback from surveys or social media could help optimize the design of new products and services. A hotelier could increase revenue and profitability with a demand-based pricing tool to adjust room rates on an hourly or daily basis, using near-real-time data to optimize pricing based on demand. Data about a customer’s circumstances and preferences could be leveraged to offer additional, more personalized services, such as transport from the nearest train station, easier car parking, preferred meal options, spa services, entertainment and a personalized welcome.

As an example: In a trucking system, the ecosystem might look something like that shown in Figure 3, which identifies the constituencies in the ecosystem and the data (implied, rather than included here) that each provides or consumes as part of the value chain(s) within the ecosystem.


Figure 3. Example constituencies of a trucking ecosystem

Truck PartsData

Truck Diagnostics

Truck Location

Truck Driver

Truck Driver’sMobile

Truck

Truck Driver’sFamily

Customers

Trucking Company’s

Service Team

Local TruckParts Supplier

Trucking Company HQ

TruckingLogistics System

Fleet Management System

(reliability data/service records)

THE ECOSYSTEM

By thinking first about what is possible before focusing on the solution, the company could then arrive at a conceptual architecture (Figure 4).

To get real value out of this conceptual architecture, a company would have to orchestrate business processes across hybrid applications and systems — and, of course, we would need to be able to do that in a configurable event- or data-driven way. This is why we need to include, importantly, an agility and orchestration platform and a business process management system (Figure 5). We can now start to envision some new disruptive digital business models.

DispatcherTransport

Company 1

Client Fleet Mgmt. App Store

Client Fleet Mgmt. as a Service

BPMS Process Orchestration Platform

Agility & Orchestration Platform

DispatcherTransport

Company 2SupplierPartner

Client Business& IT

Truck Driver Repair Assistant Partner (RAP)

Service Desk

Value–AddServices


Figure 4. Example conceptual architecture of a trucking ecosystem

BUSINESS PROCESS

MANAGEMENT SYSTEM

AugmentedReality (AR) App

Notification(Pushover)

Task-In Box

Mobile Device

AugmentedReality System

AR Server

Car Connect

Car Connect Server

GoogleMaps

Fleet MgmtSimulation

Service Center UI

Driver

Driver notified that self repair task details

have been sent

Driver receives task to use AR app to attempt

repair

Driver attempts repair

AR app provides the driver with assistance in repairing a defect

himself

The mobile app downloads the vehicle AR information. URL is determined from the

type of problem

Provides the position of the truck and its ID as well as the problem code when the truck

has a defect

Alternative mapping and

real-time analytics

Provide maps for the service sta� to locate the defective

truck

ServiceCenter

Simulate the integration with the

FMS application. O�ers services, i.e.:• Register incident• Provide AR data

location• Clear incident• Find nearest RAP

External RepairAssistant Provider

(RAP)

integrates the components and executes the business process

CSC OmniLocation

Service Center personnel are available to monitor the

situation

External roadside assistance

provider called if the driver cannot fix the problem

Figure 5. Illustrative business process management system for a trucking ecosystem

Each constituent engages with the ecosystem via published APIs, allowing much easier and quicker reconfiguration of the business model as required. This “system of systems” architecture — the orchestrated set of services operating to support the required ecosystem value chains — is at the heart of building an agile service-enabled digital enterprise.

Building your ecosystem, by means of an integration-first strategy, will typically leverage the scalability and elasticity of cloud solutions. That may well mean replacing point-to-point integrations and letting enterprise applications coexist with newer technologies.

A key implication of the ecosystem model is that the CIO and the IT department will have a new objective: to push capability not just within the firm but also out to the enterprise’s boundary, allowing internal and external constituencies to interoperate. The traditional model has two objectives:

1. Factor out common business functions — such as human resources, commercial and legal — organizationally

2. Provide governance for a standardized portfolio of business applications to serve the needs of the business and support its user base

The new shared-services model adopts an everything-as-a-service approach and makes these functions — and, more importantly, the value they provide — available to a wider set of constituents at the boundary of the enterprise and of the ecosystem to which the firm is contributing value. Companies can do this by deploying platforms and apps that enact the services in digital form, allowing the services to be consumed on demand, as required. To provide the greatest flexibility and agility, this concept will inevitably take you into the realm of a microservices architecture to achieve high cohesion and loose coupling of business services, in stark contrast to the big, customized applications that have dominated in the past.

We see shared services emerging as the strategy for CIOs to provide IT as a Service (ITaaS) in support of Mode 1 delivery within the firm, as well as to provision Mode 2 platforms for innovation at the edge of the enterprise (see sidebar, “From Bimodal to Trimodal”). ITaaS implies leveraging the best services from the most innovative organizations via an as-a-service model. This approach is entirely consistent with the new digital business ecosystem model, in which everything will be built around services and consumer needs.

Connect the Legacy

Having built a modern platform and an ecosystem to enable the digital business journey, you now need to connect with your legacy systems and unlock the value from legacy data by mining it to identify valuable new information and insights. Fortunately, many iPaaS solutions provide connectors into both legacy systems and modern systems to extract data. However, additional wrapping or mapping facilities may be needed.

As application modernization is critical to this effort, CSC has developed an application modernization “factory” to industrialize and accelerate modernization (Figure 6).

To generate true business value, we need to optimize services and APIs to pull data to suit the ecosystem’s changing needs and not simply resort to pushing out data that may or may not be of interest to the consumer — while remembering that another service may actually be mining and collating data from multiple sources. This requires a model that makes potentially useful data available, rather than one that has a preconceived, more limited view of its value.


The Economist Intelligence Unit surveyed more than 500 executives on their digital journeys. Get key insights from the research at csc.com/digitalenterprisesurvey.

By way of a simple example: Amazon and YouTube include published APIs in their data. The Amazon API allows you to extract information about a product that it is selling and extract information pertaining to associated customer reviews. YouTube allows you to search for videos based on a product keyword search term. By combining the data from these two disparate sources, you can now provide additional value to a potential buyer by making related videos available directly to that consumer. This leads to a better user experience than would be the case if the user had to separately search for disparate information from disparate sources across the Internet. This is an example where value arises from providing speed to useful information in support of a buying decision.

Thus, modernization (Mode 1) unlocks the useful value. In our simple example, it makes customer reviews and videos available through readily accessible modern cloud technology and APIs, while the new ecosystem service (Mode 2) consolidates the information from the disparate sources and provides it as a more valuable package of information to help users make a buying decision. Modernization, then, provides a new channel to market for the product — in this example, by being an Amazon market supplier. This example is also useful for illustrating the platform’s significance — in this example, the Amazon Web Services (AWS) digital platform.

STAGE 3: DIGITAL TRANSFORMATION PLAN

In this stage of the framework, we establish a business priority-based set of projects or continuous delivery changes in support of the proposed transformation. As with any transformation program, this will typically involve changes across several domains, including organization and leadership, as well as technology.

This paper explains the journey to the service-enabled digital enterprise at a high level, with an end-to-end view; however, companies can rarely execute their vision and strategy in such a neat, convenient and logical way. Budget constraints, business pressures, lack of skills, culture, maturity and many other factors will complicate the journey. At face value, what many firms are actually doing can appear to be at odds with the journey. The simple two-dimensional representation shown in Figure 1 can be taken to mean a linear left-to-right plan. But more often, companies employ a jagged “wave-front” of progress — a set of parallel initiatives that may or may not be joined up.


EXTRACTING VALUEAn intelligent application modernization approach separates the valuable from the dross, so that connecting legacy systems adds business value. Several modernization treatments can be used to accomplish this:

• Revamping and simplifying the portfolio to reduce technical debt, retiring applications that no longer provide business value

• Replatforming systems to eliminate the use of obsolescent infrastructure or old technology that presents a significant business risk

• Replacing applications or components of systems that fall short in delivering a required capability, or where newer versions can extend the lives of those systems

• Extending the portfolio to add functionality or provide new interfaces and APIs to support the growing needs of consumers or of the extended ecosystem

REPLACE AND EXTEND

ERP Simplification

& Modernization

SaaSEnablement

MicroServicesand MobileEnablement

IoT and Analytics Integration

Manage - Transform - Manage

REPLACE EXTEND

CodeSimplification

End-of-Life Upgrade

Archive

Decommission

Consolidate

REVAMP &SIMPLIFY PARTNER

SOLUTIONS

CSC TOOLS

TARGETPLATFORMS

REPLATFORM Rehost Legacy

Convert COBOL to

Java

Legacy DBto RDBMS

P2V and V2V

UNIX to LINUX

Microsoft Migration

COTS Migration

OFF MAINFRAME CLOUD MIGRATION

Migration Planning and Roadmap

Move Groups

Assessment and Heatmap

Application Attribution

Data Center Discovery

ASSESSMENT AND DISCOVERY

Dependency Analysis

U2L Migration Assistant U2L Assessment Tool

CFML2NetVB2Web, VB2.Net

Wrapper for Enterprise Library

QTE

MâCS

Figure 6. CSC’s application modernization “factory”: Providing the platform for creating value from a company’s current portfolio

In working with many clients, we typically find that the digital transformation plan manifests as a series of parallel client initiatives:

• Making decisions around major business “levers,” for example, selecting platforms and moving to the cloud. CSC has worked with clients to adopt an integration-first approach using an iPaaS solution to join up many disparate and disconnected services. This allows companies to start to switch their “asset” view from a focus on their applications portfolio to a focus on valuable end-to-end business processes. This approach provides new building blocks for constructing and improving services.

• Trying to protect intellectual property and investments, while adopting new solutions to reduce capital expenditures on data centers in favor of operational expenditures on services. CSC has provided new as-a-service consumption models for our clients that cover many traditional service offerings, including Testing as a Service, Application Management as a Service and Development Platform as a Service. Switching to an as-a-service model provides greater flexibility and cost savings. In the case of Application Management as a Service, for example, we have introduced a new model that aligns application management costs more directly with business risk, as opposed to the traditional blanket support agreements that characterize many SLAs. This approach allows variable and more effective support during peak workloads — e.g., those associated with seasonal events — without incurring premium fees outside these periods.

• Seeking to grow rapidly, retain customers and improve their experience, for example, through mobile applications. CSC has built mobile applications that provide new customer engagement opportunities, ranging from ordering coffee to reporting potholes in roads. These have opened new engagement channels between providers and consumers — leading to new revenue streams and greater customer satisfaction.

STAGE 4: DIGITAL TRANSFORMATION

The digital transformation stage is where the journey to the service-enabled digital enterprise moves from paper, planning and aspiration to digital reality. It’s the stage where the business priority-based set of projects or continuous-delivery changes are executed.

We don’t mean to imply that this is the last stage or that all projects and activities are equal. The digital era demands a fundamental relook at what is often assumed. Waterfall-based projects that take months to implement, or project plans that are constructed for total robustness, aren’t going to succeed. The digital era demands a “succeed fast or fail” mind-set, so implementation has to be centered on speed to value and on improving the ability of the business to rapidly change course as the market demands. In simple terms, this requires a three-dimensional approach:

1. The “Town Planner” dimension, in which the best aspects of risk, security, governance and compliance are retained but modernized for the digital world

2. The “Pioneer” dimension, in which the focus is on experimentation and developing new capabilities, typically, using agile methods

3. The “Settler” dimension, in which the new and the old are operationalized and maintained

This approach will flex continuously in a collaborative environment. This flexing is where we see DevOps becoming preferred, with its emphasis on speed, priority, continuous improvement, change management and quality in a collaborative governance model. While DevOps requires cultural changes to succeed, our Development Platform as a Service (DPaaS) offering is an example of a platform-based business lever that will enable the changes to happen.


© 2017 Computer Sciences Corporation. All rights reserved. MD_9846a-1 01/2017

ACCELERATE YOUR DIGITAL TRANSFORMATION

CSC provides a full range of application services that include modernization, integration, testing, development and management, all of which are aimed at delivering digital business platforms and solutions for the service-enabled digital enterprise. We also offer deep industry experience in insurance, healthcare, banking, manufacturing and retail, among other industries. CSC’s application services include a number of innovative as-a-service consumption models and outcome-based pricing schemes.

Our trimodal approach of “Select the Platform, Create the Ecosystem and Connect the Legacy” is fully supported by our digital transformation framework. This approach leverages our strong technology partner ecosystem — which includes SAP, Oracle, IBM, AWS, ServiceNow, Microsoft and others — across a full range of consulting, modernization, integration, testing, development and management services.

In a world characterized by unprecedented digital disruption, digital skills shortages and, in many cases, lack of clear direction on how to succeed in the new digital reality, we encourage you to engage with us now to address your needs.

ì Learn more at csc.com/digital.

Regional CSC Headquarters

The Americas1775 Tysons Boulevard Tysons, VA 22102 United States

Asia, Middle East, AfricaLevel 9, UE BizHub East 6 Changi Business Park Avenue 1 Singapore 468017 Republic of Singapore +65.6809.9000

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