Extracting Value from SOA
Presentation Title | Date | Page 1
Demonstrating the ROI for SOA
Presentation Title | Date | Page 2
What’s your ROI for SOA?
Yes
14%
Have you constructed a solid ROI
Assessment for SOA?
No
86%
Surveys from attendees to previous
webMethods SOA Masterclass
Presentation Title | Date | Page 3
Business Case Basics …
Vo = Vn – [£ + T + W]
The Value of Opportunity =
+ New Value Created
– Lifecycle Cost of Effort
– Time to Implement
– Waste & Residual Garbage
Presentation Title | Date | Page 4
SOA Promises ... Reduced costs
Vo = Vn – [£ +T + W]
Lifecycle Cost of Effort reduced
Time to Implement reduced
Waste & Residual Garbage reduced
Cost Reduced
Value Increased
Technical Consistency
Reuse of Assets
Composition Rather
Than Dev
Reuse
Presentation Title | Date | Page 5
The Cost of Delivering Applications with Reuse
“By adopting an SOA platform from
webMethods, Superpartners is
benefiting from the ability to re-use a
number of services.
Development
Cost ($)
x
We have already seen 30% – 40%
re-use of interfaces and services
created along with reduced
maintenance costs and effort to
support business change”
App #1
App #2
App #3-
App #n CIO Superpartners.
Gary Evans,
Time
Presentation Title | Date | Page 6
SOA Governance Benefits …
SOA Governance Benefits
Cell entries can be changed to see how they affect results.
Cell contains derived results and is locked, but can be copied and pasted into other spreadsheets
Productivity
Increased design and
development productivity is
achieved with SOA
governance via role and
policy enforcement, service
contracts, and easy access to
service specifications.
Number of Services to be Developed
Development Effort Each without webMethods SOA
Reduction in Development Effort Using webMethods SOA
Labor Cost
Productivity Savings
Total Productivity Savings
Amounts in
Thousands (1,000)
Year 1
Year 2
Year 3
Year 4
Year 5
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
5
15
30
10
30
60
20
60
120
30
90
180
30
90
180
(hrs)
697
287
216
697
287
216
697
287
216
697
287
216
697
287
216
(%)
5%
10%
10%
5%
10%
10%
5%
10%
10%
5%
10%
10%
5%
10%
10%
75
79
83
87
91
($/hr)
13
32
49
27
68
102
58
142
214
91
224
338
95
235
354
($K)
94
197
414
653
685
($K)
Testing*
Testing time is reduced due
to design policy enforcement
and dependency
management. Efficiencies in
unit testing offset slightly
more complicated system
testing due to modularity.
Number of Services to be Developed
Testing Effort Each without webMethods SOA
Reduction in Testing Effort Using webMethods SOA
Labor Cost
Testing Savings
Total Testing Savings
Year 1
Year 2
Year 3
Year 4
Year 5
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
5
15
30
10
30
60
20
60
120
30
90
180
30
90
180
(hrs)
349
144
108
349
144
108
349
144
108
349
144
108
349
144
108
(%)
10%
8%
5%
10%
8%
5%
10%
8%
5%
10%
8%
5%
10%
8%
5%
75
79
83
87
91
($/hr)
13
13
12
27
27
26
58
57
54
91
90
84
95
94
89
($K)
38
80
168
265
278
($K)
Reuse
Typically the key driver of
SOA savings, reuse
leverages clear specifications
and documentation of
granular services to avoid
recoding of similar
functionality. The amount of
services reused will differ by
industry.
Number of Services to be Developed
Incremental Portion of Services Reused
Development Effort Each without webMethods SOA
Reduction in Development Effort Using webMethods SOA
Development Effort Savings when Reusing a Service
Labor Cost
Reuse Savings
Total Reuse Savings
(%)
(hrs)
(%)
(%)
($/hr)
($K)
($K)
Total Design Time Savings
($K)
Operations/Support
At run time, support effort is
significantly reduced due to
more granular visibility, built-in
SLA management, load
balancing, and controlled
access to services. Reuse
factors in here too because of
common components.
Number of Services in Production
Operations/Support Effort Each without webMethods SOA
Reduction in Ops/Support Effort Using webMethods SOA
Labor Cost
Operations/Support Savings
Operations/Support Avoidance Due to Reuse
Total Operations/Support Savings
Year 1
Year 2
Year 3
Year 4
Year 5
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
3
8
15
10
30
60
25
75
150
50
150
300
80
240
480
(hrs)
24
8
6
24
8
6
24
8
6
24
8
6
24
8
6
(%)
50%
50%
50%
50%
50%
75
79
83
87
91
($/hr)
3
2
3
9
9
14
25
25
37
52
52
78
88
88
131
($K)
0
0
1
0
1
3
1
2
7
3
5
16
4
9
26
($K)
10
37
98
206
346
($K)
Maintenance
Risk and effort associated
with planned maintenance is
reduced with SOA
governance because of runtime version management,
built-in dependency
management, access control,
and reuse.
Number of Services in Production
Maintenance Effort Each without webMethods SOA
Reduction in Maintenance Effort Using webMethods SOA
Labor Cost
Maintenance Savings
Maintenance Avoidance Due to Reuse
Total Maintenance Savings
Year 1
Year 2
Year 3
Year 4
Year 5
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
3
8
15
10
30
60
25
75
150
50
150
300
80
240
480
(hrs)
240
78
57
240
78
57
240
78
57
240
78
57
240
78
57
(%)
40%
40%
40%
40%
40%
75
79
83
87
91
($/hr)
22
19
26
76
74
108
198
193
283
417
406
594
700
683
998
($K)
2
3
8
6
11
32
15
29
85
31
61
178
53
102
299
($K)
78
306
803
1,687
2,835
($K)
Total Run Time Savings
($K)
Design Time
Year 1
Year 2
Year 3
Year 4
Year 5
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
Complex Moderate Simple
5
15
30
10
30
60
20
60
120
30
90
180
30
90
180
5%
10%
20%
5%
10%
20%
5%
10%
20%
5%
10%
20%
5%
10%
20%
697
287
216
697
287
216
697
287
216
697
287
216
697
287
216
5%
10%
10%
5%
10%
10%
5%
10%
10%
5%
10%
10%
5%
10%
10%
80%
85%
90%
80%
85%
90%
80%
85%
90%
80%
85%
90%
80%
85%
90%
75
79
83
87
91
11
28
88
22
59
186
47
123
390
74
194
614
77
204
645
127
267
560
882
926
259
544
1,142
1,799
1,889
Run Time
88
343
901
1,893
3,180
Presentation Title | Date | Page 7
SOA – Additional Opportunities
Vo = Vn – [£ + T + W] – Change the balance, change the decision
Multi-channel consistency (web, call centre, mobile ….)
Assist the move to process centric operations => BPMS + SOA
Better context for business users
Eliminate duplicate applications/Enable application replacement
Customer bonding
Presentation Title | Date | Page 8
Presentation Title | Date | Page 9
Improved Information Access
ISSUE:
Accurate Inventory Data
Nissan Europe achieved integrated SOAbased supply chain via a cost-effective
multiphase modernization process, and
contributed to an overall vehicle
inventory reduction of almost
35% within 3 years.
Presentation Title | Date | Page 10
Delivering Business Improvement To Cox
Rapid application delivery
Flexible platform for delivering on
competitive improvements made
in field service capabilities
The end result – Significant
improvement in customer
satisfaction and productivity
improvement for FSRs
Presentation Title | Date | Page 11
Learning from Success in Multiple Industries
Solution Focus
Telecom
Financial Services
Business Process
Management
Service Oriented
Architecture
High Tech
Government
Proven
Methodology
Presentation Title | Date | Page 12
SOA and BPM
Presentation Title | Date | Page 13
BPM Technology: The Catalyst
Process Analytics
& Monitoring (BAM)
Automated decision-making
Business Rules
Real time visibility
$
Analytics
Automation
& Coordination
Composite
Application
Framework (CAF)
What If?
Process
Execution
Codeless Development
&
Productive Workspaces
Collaboration, concensus
Leave
& Layer
Process
Simulation
Process Modeling
& Design
SOA & Integration
Presentation Title | Date | Page 14
Delivering BPM requires access to services
Becoming dependent on a service
•
•
•
•
•
•
•
Where are they?
How to find the right one?
Is it the right one to use?
Will it meet my projected usage?
Will it it be stable?
Will it be impacted by other consumers?
Can I trust it?
Creating re-usable services
• Services need constructing/exposing
• Business programme gives visibility to future consumers and needs
Presentation Title | Date | Page 15
The value of BPM and SOA
Both SOA and BPM have strategic value to an enterprise
•
But together they provide a more holistic approach to development and
operational management
Both focus on a business value proposition and focus on a business
oriented view into their respective worlds
Both create new opportunities for business:
•
•
•
Example: 3 week concept to retirement
Business cannot waste time in requirements documents, specifications, etc
Losing 1 day to get into production is 5% of overall revenue
•
•
•
IT must not be in the delivery process
IT must have the governance framework in place to assure success
Operations must have the governance controls to assure production responsiveness
Presentation Title | Date | Page 16
Agility and flexibility
Which of the following would you regard as significant business level drivers for
investing in SOA?
0% 10% 20% 30% 40% 50% 60% 70% 80%
More rapid and flexible IT response to
changing business needs
Enhanced ability for IT to drive and/or
support business innovation
Cost savings from more efficient delivery of
IT
Protection of past and future IT investments
by delaying obsolescence
Improved operational service levels to the
business
Experienced adopters
All respondents
Source: Freeform Dynamics/MWD Survey,
May/Jun 2006 (Sample 1332)
Presentation Title | Date | Page 17
SOA business value
Beyond system flexibility to processes and relationships.
A service-based approach enables an environment
in which system value can be readily understood
by the business
4.
A service-based approach enables an environment
in which IT capabilities can be easily understood
and specified by business analysts
Value visibility
3
Comprehensibility
End-to-end management of the
service lifecycle which “joins up”
activities from design to operation
A development lifecycle that
promotes
reuse of services
Reusability
Flexibility
An architecture approach that
promotes service designs which
are business-meaningful
2
A service-based approach creates software assets which
can be reused across projects, making systems cheaper and
lower-risk to build
1
A service-based approach creates modular systems which
are easier and quicker to change
Presentation Title | Date | Page 18