Jason Weisser, PHDCTO, Vice PresidentSOA Advanced TechnologyIBM Software

How a Service Oriented Architecture Delivers An On Demand Advantage

Creating the Real-time Enterprise

Apr 20, 2023Apr 20, 2023

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Information Age Evolution

Client / ServerClient / Server

On Demand EraOn Demand Era

MainframeMainframeAdministrative ProductivityAdministrative Productivity

Personal & Departmental ProductivityPersonal & Departmental Productivity

Organizational ProductivityOrganizational Productivity

1960 1970 1980 1990 2000

Source: U.S. Department of Commerce

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Buying, not browsing...working, not surfing, …..

Integrate InternallyAccess Publish Transact Integrate Externally Adapt Dynamically

Access EnterpriseIntegration On Demand

Optimize operations...Connect to the Internet...

An on demand business is an enterprise whose business processes – integrated end-to-end across the company and with

key partners, suppliers and customers – can respond with speed to any customer demand, market opportunity or external threat

e-business Evolving to On Demand

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E01-EDI

Data Warehouse(Interfaces to and from theData Warehouse are not

displayed on this diagram)

G02 - GeneralLedger

A05 - AP

S01 - SalesCorrections

I01 POReceiving

I03 Return toVendor

I06 WarehouseManagement

Mainframe

PC/NT apps Unix apps

3rd Party Interface

S06 - Credit App

P15 EES EmployeeChange Notice

OTHER APPS - PCAP - Collections/Credit

TM - Credit Card DB

ACCTS REC APPS - PC990CORBad Debt

Beneficial FeesBeneficial Reconcile

JEAXFJEBFAJEBKAJEDVAJESOAJEVSAJEVSFNSF

TeleCredit Fees

INVENTORY CONTROL APPS - PCCode Alarm

Debit ReceivingsDevo Sales

Display InventoryIn HomeJunkouts

Merchandise WithdrawalPromo CreditsRTV Accrual

ShrinkAP Research - Inv CntrlAP Research-Addl Rpts

Book to Perpetual InventoryClose Out Reporting

Computer Intelligence DataCount Corrections

Cross Ref for VCB DnldsDamage Write OffDebit Receivings

DFI Vendor DatabaseDisplay Inventory ReconcileDisplay Inventory Reporting

INVENTORY CONTROL APPS - PCDPI/CPI

IC BatchingInventory Adj/Count CorrectInventory Control Reports

Inventory LevelsInventory Roll

Merchandise WithdrawalOpen ReceivingsPI Count Results

PI Time Results from InvPrice Protection

Sales Flash ReportingShrink Reporting

SKU Gross MarginSKU Shrink Level Detail

USMVCB Downloads

Journal Entry Tool Kit

Scorecard - HR

L02-ResourceScheduling(Campbell)

P09 - P17Cyborg

M02 - Millennium

M03 - Millennium 3.0

Banks - ACH and Pos toPay

Cobra

B01 - StockStatus

S03-Polling

P14 On-line NewHire Entry

CTS

Plan Administrators(401K, PCS, Life,

Unicare, SolomonSmith Barney)

D01 Post LoadBilling

I04 HomeDeliveries

I02 -Transfers

Arthur Planning

I07 PurchaseOrder

I12 EntertainmentSoftware

I05Inventory Info

E13E3 Interface

S04 - Sales Posting

V01-Price ManagementSystem

I10 Cycle PhysicalInventory

I55 SKUInformation

K02Customer Repair

TrackingI35 Early Warning

System

B02 MerchandiseAnalysis

I13- AutoReplenishment

U18 - CTO

Intercept

I09 Cycle Counts

E02-EmployeePurchase

Texlon 3.5

ACH

Stock Options

I17 Customer PerceivedIn-Stock

U16-Texlon

SiteSeer

C02 - CapitalProjects

F06 - FixedAssets

US Bank ReconFile

Star Repair

EDICoordinator

Mesa Data

NEW SoundscanNPD Group

AIG Warranty Guard

Resumix

Optika

Store BudgetReporting

P16 - Tally Sheet

Cash Receipts/Credit

S05 - HouseCharges

Ad Expense

L01-PromoAnalysis

V02-PriceMarketingSupport

BMP - Busperformance Mngt

StoreScorecard

I11 PriceTesting

Valley Media

P09Bonus/HR

I15 Hand ScanApps

Roadshow

POS

S08 - VertexSalesTax

A04 - CustRefund Chks

Equifax

ICMS Credit

CellularRollover

S09 - DigitalSatelliteSystem

NPD,SoundScan

Sterling VANMailbox (Value)

I18SKU Rep

X92-X96Host to AS400

Communication

S02 -Layaways

Washington,RGIS,

Ntl Bus Systems

V04-SignSystem

I14 Count CorrectionsNARM

P01-EmployeeMasterfile

I06 - CustomerOrder

FrickCo

UAR - Universal AccountReconciliation

DepositoryBanks

S07 - CellPhones

S11 - ISPTracking

AAS

Fringe PO

Cash Over/Short

L60 MDFCoop

SKU SelectionTool

SKUPerformance

SupplierCompliance

1

I35 - CEI

ASIS

Misc Accounting/Finance Apps - PC/NTCOBA (Corp office Budget Assistant)

PCBS(Profit Center Budget System)Merchandising Budget

AIMSMerch Mngr Approval

Batch ForcastingAd Measurement

AIMS Admin

AIMSReportingAd

Launcher

V03- MktReactions

SpecSource

CTO2.Bestbuy.com

RebateTransfer

SignSystem

CopyWriter'sWorkspace

ELTPowerSuite

StoreMonitor

AIS Calendar

Stores & Mrkts

Due Dates

Smart Plus

InsertionsOrders

BudgetAnalysis Tool

Print CostingInvoice App

AIS Reports

BroadcastFilter

Smart PlusLauncher

GeneralMaintenance

Printer PO

PrinterMaintenance

VendorMaintenance

Vendor Setup

Connect 3

Connect 3Reports

Connect 3PDF Transfe

Spec SourceSKU Tracking

S20-SalesPolling

Prodigy

PSP

In-HomeRepair

WarrantyBillingSystem

Process Servers(Imaging)

Prepared by Michelle Mills

Complexity is Forcing Change

Actual Application Architecture for Consumer Electronics Company

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Controlled Transformation

Start is by deconstructing your business model - breaking it down into discrete business processes and functions

These processes and functions are what we call service components

Each service component serves a unique purpose and interacts with other service components in the business model, using agreed-upon cost structures and service levels

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BusinessOrchestration

Business ProcessManagement

BusinessChoreography

BusinessCollaborations

BusinessWorkflow

Business Orchestration

This process defines the control and data flow between web services to achieve a business process. Orchestration defines an

“executable process” or the rules for a business process flow defined in an xml document which can be given to a business

process engine to “orchestrate” the process, from the viewpoint of one participant.

Business Choreography

This process defines the sequence and dependencies of interactions between multiple roles to compose and implement a business Process composing multiple web services. Choreography

describes the sequence of interactions for Web services messages - it defines the conditions under which a particular web service operation can be invoked. WSDL describes the static interface and

Choreography defines the “Dynamic” behavior external interface from a global view.

BPEL4WS primarily focuses on orchestration, while WSCI focuses on choreography. With SWCA each participant in the message exchange defines a SWCI interface. With BPEL4WS you describe an

executable process from the perspective o one of the participants.

Business Collaboration

This process defines the sequence and dependencies of interactions between multiple roles to implement a business Process composing multiple web services. Choreography describes the sequence of interactions for Web services messages - it

defines the conditions under which a particular web service operation can be invoked. WSDL describes the static interface and Choreography defines the “Dynamic” behavior external interface from a global view.

BPEL4WS primarily focuses on orchestration, while WSCI focuses on choreography. With SWCA each participant in the message exchange defines a SWCI interface. With BPEL4WS you describe an executable process from the perspective o one

of the participants.

Business Process Management

This relates to the differential process of managing the various dependencies of interactions between and among multiple services, including security, policies, and web services.

Business process management includes the various activities both in the initial decomposition of the web services, and the administration of the security or event policy, all

within the context of a services framework.

Business Workflow & Coordination

This describes an extensible framework for providing protocols that coordinate the actions of distributed applications. Such coordination protocols are used to support a number of

applications, including those that need to reach consistent agreement on the outcome of distributed transactions. This process(es) enables an application service to create a context

needed to propagate an activity to other services and to register for coordination protocols. The framework enables existing transaction processing, workflow, and other systems for coordination

to hide their proprietary protocols and to operate in a heterogeneous environment.

Why does SOA Governance lie at the heart of any successful Solution?Why does SOA Governance lie at the heart of any successful Solution?

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StrategyStrategy

TacticsTactics

ExecutionExecution

Citizen Relationship

Citizen Relationship

ManufacturingManufacturing Supply Chain &Distribution

Supply Chain &Distribution

BusinessAdministration

BusinessAdministration

Category

P&L Management

Matching Supply and Demand

Effectiveness

Service Ideation

Marketing Execution

Service Directory

Category

Assessing Citizen Satisfaction

Citizen Insights

Account Management

Value-Added Services

Citizen Account Servicing

Retail Marketing Execution

Citizen Directory

Manufacturing Strategy

Supplier Relationship Management

Production and Materials Planning

Manufacturing Oversight

Supplier Control

Make Products

Plant Inventory Management

Manufacturing Procurement

Assemble/Pkg. Products

Distribution Oversight

Distribution Center Operations

Transportation Resources

En Route Inventory Management

Inbound Logistics

Corporate Strategy

Alliance Management

Line of Business Planning

Business Performance Management

External Market Analysis

Organization and Process Design

Legal and Regulatory Compliance

Treasury and Risk Management

Facilities and Equipment Management

IT Systems and Operations

HR Administration

Citizen Relationship Strategy

Citizenry Relationship Planning

Supply Chain Strategy

Supply Chain Planning

Outbound Logistics

Accounting and GL

Indirect Procurement

Corporate Planning

Concept/Service Testing

Service Development

Service Management

Citizen ServiceIn-store Inventory Mgmt

Tax ServiceTax Service

Deconstruct & Conquer: The Component Business Model

Example: eGovernment

1 First, break down your business into its components 3 42

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2

StrategyStrategy

TacticsTactics

ExecutionExecution

CustomerRelationship

CustomerRelationship

ManufacturingManufacturing Supply Chain &Distribution

Supply Chain &Distribution

BusinessAdministration

BusinessAdministration

Category/Brand Strategy

Brand P&L Management

Matching Supply and Demand

Marketing Development & Effectiveness

Product Ideation

Marketing Execution

Product Directory

Category/Brand Planning

Assessing Customer Satisfaction

Customer Insights

Account Management

Value-Added Services

Customer Account Servicing

Retail Marketing Execution

Customer Directory

Manufacturing Strategy

Supplier Relationship Management

Production and Materials Planning

Manufacturing Oversight

Supplier Control

Make Products

Plant Inventory Management

Manufacturing Procurement

Assemble/Pkg. Products

Distribution Oversight

Distribution Center Operations

Transportation Resources

En Route Inventory Management

Inbound Logistics

Corporate Strategy

Alliance Management

Line of Business Planning

Business Performance Management

External Market Analysis

Organization and Process Design

Legal and Regulatory Compliance

Treasury and Risk Management

Facilities and Equipment Management

IT Systems and Operations

HR Administration

Customer Relationship Strategy

Customer Relationship Planning

Supply Chain Strategy

Supply Chain Planning

Outbound Logistics

Accounting and GL

Indirect Procurement

Corporate Planning

Concept/Product Testing

Product Development

Product Management

Consumer ServiceIn-store Inventory Mgmt

Product Management

Product Management

Strategic differentiation

Strategic View

Competitive parity

Basic

Next, decide what’s differentiating and what is simply operating

Example: Consumer Packaged Goods

Deconstruct & Conquer: The Component Business Model1 3 4

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StrategyStrategy

TacticsTactics

ExecutionExecution

CustomerRelationship

CustomerRelationship

ManufacturingManufacturing Supply Chain &Distribution

Supply Chain &Distribution

BusinessAdministration

BusinessAdministration

Category/Brand Strategy

Brand P&L Management

Matching Supply and Demand

Marketing Development & Effectiveness

Product Ideation

Marketing Execution

Product Directory

Category/Brand Planning

Assessing Customer Satisfaction

Customer Insights

Account Management

Value-Added Services

Customer Account Servicing

Retail Marketing Execution

Customer Directory

Manufacturing Strategy

Supplier Relationship Management

Production and Materials Planning

Manufacturing Oversight

Supplier Control

Make Products

Plant Inventory Management

Manufacturing Procurement

Assemble/Pkg. Products

Distribution Oversight

Distribution Center Operations

Transportation Resources

En Route Inventory Management

Inbound Logistics

Corporate Strategy

Alliance Management

Line of Business Planning

Business Performance Management

External Market Analysis

Organization and Process Design

Legal and Regulatory Compliance

Treasury and Risk Management

Facilities and Equipment Management

IT Systems and Operations

HR Administration

Customer Relationship Strategy

Customer Relationship Planning

Supply Chain Strategy

Supply Chain Planning

Outbound Logistics

Accounting and GL

Indirect Procurement

Corporate Planning

Concept/Product Testing

Product Development

Product Management

Consumer ServiceIn-store Inventory Mgmt

Product Management

Product Management

Deconstruct & Conquer: The Component Business ModelThen, analyze costs 3

High capital area

Financial View

High cost area

High cost & capital area

Example: Consumer Packaged Goods

1 42

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Finally, prioritize your transformation initiatives

StrategyStrategy

TacticsTactics

ExecutionExecution

CustomerRelationship

CustomerRelationship

ManufacturingManufacturing Supply Chain &Distribution

Supply Chain &Distribution

BusinessAdministration

BusinessAdministration

Example: Consumer Packaged Goods

Category/Brand Strategy

Brand P&L Management

Matching Supply and Demand

Marketing Development & Effectiveness

Product Ideation

Marketing Execution

Product Directory

Category/Brand Planning

Assessing Customer Satisfaction

Customer Insights

Account Management

Value-Added Services

Customer Account Servicing

Retail Marketing Execution

Customer Directory

Manufacturing Strategy

Supplier Relationship Management

Production and Materials Planning

Manufacturing Oversight

Supplier Control

Make Products

Plant Inventory Management

Manufacturing Procurement

Assemble/Pkg. Products

Distribution Oversight

Distribution Center Operations

Transportation Resources

En Route Inventory Management

Inbound Logistics

Corporate Strategy

Alliance Management

Line of Business Planning

Business Performance Management

External Market Analysis

Organization and Process Design

Legal and Regulatory Compliance

Treasury and Risk Management

Facilities and Equipment Management

IT Systems and Operations

HR Administration

Customer Relationship Strategy

Customer Relationship Planning

Supply Chain Strategy

Supply Chain Planning

Outbound Logistics

Accounting and GL

Indirect Procurement

Corporate Planning

Concept/Product Testing

Product Development

Product Management

Consumer ServiceIn-store Inventory Mgmt

Product Management

Product Management

Deconstruct & Conquer: The Component Business Model

Seek external provider / external utility

Transformational View

Consolidate and/or create internal utility

Integrate and redesign

4

No action

1 32

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The Vertical Silo Problem

Division “A” Division “B” Division “C” Division “D” Division “E”

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Where Are We Heading – Service Oriented Architecture

Outsourced

SupplierSupplier

Shared ServicesShared Services

Division (s)

CustomerCustomer

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Need for a Services Oriented Architecture

Monolithic Business Applications – built historically Must periodically synchronize on inventory information Pricing information into each inserted differently based on application structure No common customer database, inventory or flexibility in business processes

Web OrdersWeb Orders Sales Orders& Supply ChainSales Orders

& Supply Chain

Pricing

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Component-based Architecture is Not Enough

Services defined as units of business logic, but …. Flow of control – bound into service logic Transformation of data formats bound into service logic Tight coupling between services makes them fragile

Web OrdersWeb OrdersInventoryInventory

SalesOrdersSales

OrdersShipments

CustomersCustomersPricing

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Move IT Logic Out of Services

Services defined as units of business logic separated from ….. Flow of control and routing Data transformation and protocol transformation

InventoryInventory

SalesOrdersSales

OrdersShipments

CustomersCustomersPricing

Web OrdersWeb Orders

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MessageQueuing

Abstracts the connectivity

logic from the application

MessageBrokering

Abstracts the connectivity +

mediation logic from the

application

ServiceOrientation

Reduces application to its core business

functions(i.e. a service)

ApplicationApplication ApplicationApplication

Degree of Flexibility and ReuseDegree of Flexibility and Reuse

DirectConnectivity

All connectivity, mediation and additional logic

buried in the application.

ApplicationApplication

Lin

es o

f co

de

Lin

es o

f co

de

Application Services

Application Services

Connectivity,Mediation and

Additional Logic

Connectivity,Mediation and

Additional Logic

Mediation andAdditional LogicMediation and

Additional Logic

Additional LogicAdditional Logic

Connectivity LogicConnectivity Logic

Connectivity andMediation Logic

Connectivity andMediation Logic

Connectivity,Mediation and

Additional Logic

Connectivity,Mediation and

Additional Logic

SOA: The Next Step on the Connectivity Evolution

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Services(SOA)

Services(SOA)

Monolithic

Architectures

Pre 1950’sTo 1960’s

1970’s to mid 1980’s

Mid 1990’s toEarly 2000’s Today Late

1990’s

Increasing Modularity to Achieve Flexibility Increasing Modularity to Achieve Flexibility

Sub-routines/ Remote

ProcedureCalls

RemoteObject

Invocation

Message

ProcessingEAI

1980’s toMid 1990’s

IT’s Architectural Evolution: Making IT More Responsive

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Traditional Business*

Today’s World-Class Business*

*Sources: CBDi

Economics: globalization demands flexibility

Business Processes: changing quickly and sometimes outsourced

Growth: at the top of the CEO agenda

Reusable Assets: can cut costs

Information: greater availability

Crucial for flexibility and becoming an On Demand Business

Why SOA for Business Flexibility and Reuse?

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Gather requirements Model & Simulate Design

Discover Construct & Test Compose

Integrate people Integrate processes Manage and integrate

information

Manage applications and services

Manage identity and compliance

Monitor business metrics

Financial transparency Business/IT alignment Process control

How Are Customers Thinking Technically About SOA?The SOA Lifecycle

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IBM Integration Reference ArchitectureModular product portfolio built on open standards

Simple to develop, deploy and manage

Integrated role-based tools for development

& administration

Functionally rich, adopted incrementally

…delivering the value of SOA,

today

Robust Capabilities Connected in an Open, Flexible Manner

Infrastructure Management ServicesInfrastructure Management Services

Business Innovation & Optimization Services Business Innovation & Optimization Services

Business Application

Services

Business Application

Services

Development ServicesDevelopment Services

Partner ServicesPartner

ServicesApplication

and Information

Assets

Application and

Information Assets

Connectivity ServicesConnectivity Services

ProcessServicesProcessServices

Information Services

Information Services

Interaction Services

Interaction Services

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IT Service Management

Business Innovation & Optimization Services

Business App Services

Development Services

Partner Services

App & Info Assets

Connectivity Services

ProcessServices

Information Services

Interaction Services

Portal

App EJBs SAPAdapter

OracleAdapter

FederatedQuery

DBAccess

DBAccess

CommunityManager

Business Innovation & Optimization

improves Composite Applications

Business Dashboard

IT impacton processes

Composite Application Development Through SOA

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MainframeMainframe Client ServerClient Server

NetworkCentric

NetworkCentric On DemandOn Demand

Computing Styles Evolve Over Time Providing

Ever Increasing Value

Increase revenue Provide flexible business model Drive down cost Reduce cycle times Integrate across the enterprise Reduce business risk & exposure

Business Process + Standards + Technology is Driving Change

Business DrivenBusiness Driven

SOA EnabledSOA Enabled