Selling SOA to Your CEO

Michael Liebow, Vice PresidentBusiness Development, Global Consulting & SOAIBM Global Business Services

IBM SOA

We spoke to 1,130 CEOs and conducted in-depth analysis to determine the characteristics of the Enterprise of the Future

How are organizations addressing: New and changing customers – changes at the end of the value chain Global integration – changes within the value chain Business model innovation – their response to these changes

ANALYSIS

Quantitative and Qualitative

Current behavior Investment patterns Future intent Choices of financial outperformers Case studies of excelling organizations

SCOPE & APPROACH

1130 CEOs and Public Sector Leaders

One-hour interviews 78% Private, 22% Public Sector 32 Industries 33% Asia, 36% EMEA, 31% Americas 80% Established, 20% Emerging

Economies

IBM SOA

CEOs see significant change and opportunity ahead, and in response radically change their business designs

CEOs are

Expecting significant change (increased by 33%), while the ability to manage change has not kept pace – 39% feel unprepared

Investing heavily in engaging newly prosperous, more informed and collaborative, and socially aware customers

Moving aggressively toward global business designs, deeply changing their capabilities, partnering more extensively and using M&A to grow

Making bolder moves if they are from financial outperforming companies

Findings from 1130 interviews

IBM SOA

How do you maximize future flexibility and growth potential by adopting a business-driven framework?

Focused on process improvement by consolidating disparate systems

Ensured back-end processes support business goals like improved mobile account activation

Improved enterprise wide business intelligence with an integrated view of the customer to respond to needs more quickly and increase customer satisfaction

Bharti

IBM SOA

Differences in Culture Languages Priorities

Complex Infrastructure No Business Architecture

& Blueprint

Inhibitors for Alignment of Business and IT

IBM SOA

Companies Want IT to Deliver More Business Value

Today’s IT

Desired IT

IncreaseIncreaseValue CreationValue Creation

DecreaseDecreaseMaintenance &Maintenance &

DeliveryDelivery

30%30%New New

CapabilityCapability

70%70%Sustaining & Sustaining &

RunningRunningExistingExisting

CapabilityCapability

45%45%New New

CapabilityCapability

55%55%Existing Existing

CapabilityCapability

IBM SOA

SOA is a Business Based approach to designing IT systems that enables…

5… Business flexibility

4… Better business processes

3… Easier integration

2… Reuse of assets

1… Reduction of risk

“Anything that changes can do that much better if the system is architected in SOA.”

Gartner

How Can SOA Help Your CEO?

IBM SOA

Yansha Department Stores How do you get 1,800 national and international suppliers to buy into a new, more efficient way of doing business?

Reduced order lead time from 2.5 days to 4.5 hours

Improved order acknowledgement rate from 80 to 99%

Reduced order error rate from nine to one percent

Achieved ROI in nine months

IBM SOA

Don’t Call It SOA

Pick Projects with Tangible Benefits

Focus on Solutions

Build a Value Focused Business Case

Things to Remember When Talking SOA to Your CEO

1

Reference Thought Leaders

2

3

4

5

IBM SOA

Explain the value and benefits in business terms that reflect the organization's goals –

cost reduction

productivity

competitive advantage

– before diving into a technical conversation

Don’t Call It SOA – Speak the Right Language1

IBM SOA

Benchmark the Value with Key Agility Indicators

270 KAIs in the Benchmark Wizard

Time to establish new risk policy

60 days

21 days

Time between order delivery and order generation

24 hrs

48 hrsAverage time to locate

critical skills

8 wks

12 wks

IBM SOA

Pick Projects with Tangible Benefits

When selecting those small test projects, choose to integrate and automate those business processes that can have the most widespread, positive impact across the organization

2

IBM SOA

Process entry point

80% reduction in time to market for customized services

Partner externally in broad processes

98% of transactions in sub-second

Greater satisfaction

For example…

Foundational ExtendEnd-to-End Transform

AdaptDynamically

Transform online channel

30% increase in transactions

60% increase in online conversion rate

Pursuing acceptance & processing of filings and payments via any time, source or channel

Distinct Value with Every StyleRegardless of Where You Choose to Engage

IBM SOA

Position SOA enabling business solutions that tackle the key challenges faced by your business

Focus on Solutions 3

Industry Name

InsuranceOperations of the Future

Insurance Self Service

Chemical & Petroleum

Information Integration Framework

Banking Customer Care & Insight

Energy & Utilities Intelligent Utilities Network

Government

CBRM - Identity Mgmt

NCO - Mission Execution

Intelligent Transportation System

Integrated Case Mgmt.

Healthcare

Clinical Information Systems

Pandemic Mgmt

Healthcare Plan Modernization

Telecommunications Service Assurance

Examples

IBM SOA

Generali GroupInsurance Operations of the Future

Life Insurance division needed increased efficiencies across multiple legacy applications and infrastructure

Business processes optimization and automation, input and work management needed

Key reuse and business flexibility focus – SOA was the how

20%-30% productivity improvement with SOA implementation

IBM SOA

Cite external views on the growth and adoption of service oriented architectures and point to relevant SOA success stories within your industry (and by your competitors)

Reference Thought Leaders 4

IBM SOA

Learn How SOA Provides Value to Your Industry

http://www-935.ibm.com/services/us/index.wss/itservice_library/igs/a1002583

Insurance Healthcare Supply Chain Management

BankingBiopharmaceuticalElectronics Retail

Government

IBM SOA

Outline the immediate and long-term results from this strategy while avoiding discussions about specific version numbers and technical jargon

Build a Value Focused Business Case 5

IBM SOA

You need: Customized Component Business Model

Map SOA Reference Architecture SOA Vision and Strategy SOA Business Case SOA Governance Operating Principles &

Framework SOA Roadmap

Reduced Risk

Compliance

Increased Profitability

Improved Flexibility

Reduced Risk

Compliance

Increased Profitability

Improved Flexibility

Guiding principles for applying the SOA benefit framework

Develop an SOA Strategy, Architecture, Business Case, Governance Framework, and Roadmap to guide the transformation of an organization and systems towards a service-oriented model

Business needs context and vision to understand your approach to SOA

IBM SOA

WW Experience Sharing

Defining an SOA Project with Business Case

Project Implementation

RelationshipBusiness Value

Quantified

Business Problems Defined

ProcessDesigned

IBM Workshop

WWExperiences

LocalExpertise

ExecutiveSupport

IBM IndustryRoadmap

Process ImprovementBranchResidential

customersContact Centre

Portals

Customer CSR CSR Teller

I nternet BrowserI nternet Browser Rich clientI nternet Browser

I nternetI ntranet

Customer Portal

RelationshipBuilder

Oregon Reference dataOrigination Data

I nternet Banking

X-

Staff Portal

SOL X-

Enterprise Service Bus

NewComponents

Systemmanagement

& security services

EAI Layer

Mainframe- CI S

- CAFÉ- Front Offi ce

- Term Deposits (TY)- Trading Bank (TX)

Channels

BPM & Process Choreography

Core Banking

Systems

Pre-sales Off er Activate Fufi llProvide TAOApplication

Profi le

Conduct TAO Needs Based Conversation

Provide TAO Application

Off er

Activate TAO

Application

Provide TAO Application Completion

ProvideAccount

Conditions

Presentation Services

Relationship Builder

Service RegistryESB

Customer i.e. Customer Creation

Sales (i.e. Opportunities

Needs Conversation)

Originations (i.e. Decisioning,

Applications)

Servicing (i.e. Account Maintenance)

Payments

Marketing (i.e. Leads, Talking

Points)Reporting

Finance & Administration

Human Resources

Business Services

IFW (process models, business object models, interface design models)Common models

BranchResidential customers

Contact Centre

Portals

Customer CSR CSR Teller

I nternet BrowserI nternet Browser Rich clientI nternet Browser

I nternetI ntranet

Customer Portal

RelationshipBuilder

Oregon Reference dataOrigination Data

I nternet Banking

X-

Staff Portal

SOL X-

Enterprise Service Bus

NewComponents

Systemmanagement

& security services

EAI Layer

Mainframe- CI S

- CAFÉ- Front Offi ce

- Term Deposits (TY)- Trading Bank (TX)

Channels

BPM & Process Choreography

Core Banking

Systems

Pre-sales Off er Activate Fufi llProvide TAOApplication

Profi le

Conduct TAO Needs Based Conversation

Provide TAO Application

Off er

Activate TAO

Application

Provide TAO Application Completion

ProvideAccount

Conditions

Presentation Services

Relationship Builder

Service RegistryESB

Customer i.e. Customer Creation

Sales (i.e. Opportunities

Needs Conversation)

Originations (i.e. Decisioning,

Applications)

Servicing (i.e. Account Maintenance)

Payments

Marketing (i.e. Leads, Talking

Points)Reporting

Finance & Administration

Human Resources

Business Services

IFW (process models, business object models, interface design models)Common models

Arch DevelopmentValue Assessment

Time to open an account

0

10

20

30

40

50

60

70

1 2 3 4

AsIs vs ToBe

Tim

e (m

ins) Time taken to set up

product features

Time taken to openaccount (end to end)

Time to open an account

0

10

20

30

40

50

60

70

1 2 3 4

AsIs vs ToBe

Tim

e (m

ins) Time taken to set up

product features

Time taken to openaccount (end to end)

Break Even - Total Cumulative Costs

$-

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

Quarters

Total

Cost

WebSphere

Current Approach

Break Even - Total Cumulative Costs

$-

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

Quarters

Total

Cost

WebSphere

Current Approach

SolutionElaborated

Project Definition

SOA Rapid Value Assessment Tool

IBM SOA

Contact your IBM representative – They can help!!

Stop talking about SOA. Start doing it.