Extracting Value from SOA_tcm62-50330

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					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]                Cost Reduced
                                               Value Increased



                                              Technical Consistency
           Lifecycle Cost of Effort reduced   Reuse of Assets


           Time to Implement reduced          Composition Rather
                                              Than Dev

           Waste & Residual Garbage reduced     Reuse




                                               Presentation Title | Date | Page 5
 The Cost of Delivering Applications with Reuse




                                     “By adopting an SOA platform from
                                       webMethods, Superpartners is
Development                          benefiting from the ability to re-use a
  Cost ($)
                                              number of services.
          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-   Gary Evans, CIO Superpartners.
                                                   App #n

                            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

                                                                                                                                                                                                                                      Amounts in
Design Time                                                                                                                                                                                                                   Thousands (1,000)
                                                                                                                  Year 1                     Year 2                     Year 3                     Year 4                     Year 5
     Productivity                                                                                        Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple
     Increased design and                 Number of Services to be Developed                                   5       15       30       10       30       60       20       60      120       30       90      180       30       90      180
     development productivity is          Development Effort Each without webMethods SOA          (hrs)      697      287       216     697      287       216     697      287       216     697      287       216     697      287       216
     achieved with SOA                    Reduction in Development Effort Using webMethods SOA    (%)         5%     10%       10%       5%     10%       10%       5%     10%       10%       5%     10%       10%       5%     10%       10%
     governance via role and              Labor Cost                                              ($/hr)            75                         79                         83                         87                         91
     policy enforcement, service          Productivity Savings                                    ($K)        13       32       49       27       68      102       58     142       214       91     224       338       95     235       354
     contracts, and easy access to        Total Productivity Savings                              ($K)              94                        197                        414                        653                        685
     service specifications.
                                                                                                                  Year 1                     Year 2                     Year 3                     Year 4                     Year 5
     Testing*                                                                                            Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple
     Testing time is reduced due          Number of Services to be Developed                                   5       15       30       10       30       60       20       60      120       30       90      180       30       90      180
     to design policy enforcement         Testing Effort Each without webMethods SOA              (hrs)       349     144       108      349     144       108      349     144       108      349     144       108      349     144       108
     and dependency                       Reduction in Testing Effort Using webMethods SOA        (%)        10%       8%       5%      10%       8%       5%      10%       8%       5%      10%       8%       5%      10%       8%       5%
     management. Efficiencies in          Labor Cost                                              ($/hr)            75                         79                         83                         87                         91
     unit testing offset slightly         Testing Savings                                         ($K)        13       13       12       27       27       26       58       57       54       91       90       84       95       94       89
     more complicated system              Total Testing Savings                                   ($K)              38                         80                        168                        265                        278
     testing due to modularity.
                                                                                                                    Year 1                     Year 2                     Year 3                     Year 4                     Year 5
     Reuse                                                                                                 Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple
     Typically the key driver of          Number of Services to be Developed                                     5       15       30       10       30       60       20       60      120       30       90      180       30       90      180
     SOA savings, reuse                   Incremental Portion of Services Reused                  (%)           5%     10%       20%       5%     10%       20%       5%     10%       20%       5%     10%       20%       5%     10%       20%
     leverages clear specifications       Development Effort Each without webMethods SOA          (hrs)         697     287       216      697     287       216      697     287       216      697     287       216      697     287       216
     and documentation of                 Reduction in Development Effort Using webMethods SOA    (%)           5%     10%       10%       5%     10%       10%       5%     10%       10%       5%     10%       10%       5%     10%       10%
     granular services to avoid           Development Effort Savings when Reusing a Service       (%)          80%     85%       90%      80%     85%       90%      80%     85%       90%      80%     85%       90%      80%     85%       90%
     recoding of similar                  Labor Cost                                              ($/hr)              75                         79                         83                         87                         91
     functionality. The amount of         Reuse Savings                                           ($K)          11       28       88       22       59      186       47     123       390       74     194       614       77     204       645
     services reused will differ by       Total Reuse Savings                                     ($K)               127                        267                        560                        882                        926
     industry.
                                          Total Design Time Savings                               ($K)                259                              544                             1,142                            1,799    1,889


Run Time
                                                                                                                  Year 1                     Year 2                     Year 3                     Year 4                     Year 5
     Operations/Support                                                                                  Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple
     At run time, support effort is       Number of Services in Production                                     3        8       15       10       30       60       25       75      150       50     150       300       80     240       480
     significantly reduced due to         Operations/Support Effort Each without webMethods SOA   (hrs)        24        8        6       24        8        6       24        8        6       24        8        6       24        8        6
     more granular visibility, built-in   Reduction in Ops/Support Effort Using webMethods SOA    (%)              50%                        50%                        50%                        50%                        50%
     SLA management, load                 Labor Cost                                              ($/hr)            75                         79                         83                         87                         91
     balancing, and controlled            Operations/Support Savings                              ($K)         3        2        3        9        9       14       25       25       37       52       52       78       88       88      131
     access to services. Reuse            Operations/Support Avoidance Due to Reuse               ($K)         0        0        1        0        1        3        1        2        7        3        5       16        4        9       26
     factors in here too because of       Total Operations/Support Savings                        ($K)              10                         37                         98                        206                        346
     common components.
                                                                                                                  Year 1                     Year 2                     Year 3                     Year 4                     Year 5
     Maintenance                                                                                         Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple    Complex Moderate Simple
     Risk and effort associated           Number of Services in Production                                     3        8       15       10       30       60       25       75      150       50     150       300       80     240       480
     with planned maintenance is          Maintenance Effort Each without webMethods SOA          (hrs)      240        78       57     240        78       57      240       78       57      240       78       57      240      78        57
     reduced with SOA                     Reduction in Maintenance Effort Using webMethods SOA    (%)              40%                        40%                        40%                        40%                        40%
     governance because of run-           Labor Cost                                              ($/hr)            75                         79                         83                         87                         91
     time version management,             Maintenance Savings                                     ($K)        22       19       26       76       74      108      198     193       283      417     406       594      700     683       998
     built-in dependency                  Maintenance Avoidance Due to Reuse                      ($K)         2        3        8        6       11       32       15       29       85       31       61      178       53     102       299
     management, access control,          Total Maintenance Savings                               ($K)              78                        306                        803                       1,687                      2,835
     and reuse.
                                          Total Run Time Savings                                  ($K)                 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 SOA-
                              based 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                     Service Oriented
     Management                             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        Automated decision-making
      & Monitoring (BAM)

                  Business Rules                         Automation
                            Composite                   & Coordination
Real time visibility        Application                                  What If?
        $                Framework (CAF)
    Analytics                            Process
                                        Execution                                          Leave
         Codeless Development                         Process                             & Layer
                   &                                Simulation
        Productive Workspaces
                                                         Process Modeling
                                                             & Design

                         Collaboration, concensus                    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                       Source: Freeform Dynamics/MWD Survey,
         All respondents                            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.

                                                                                                       Value visibility
                     A service-based approach enables an environment       3
                 in which IT capabilities can be easily understood
                                     and specified by business analysts

                                                                          Comprehensibility
                                                                                                             End-to-end management of the
                                                                                                            service lifecycle which “joins up”
A development lifecycle that                                                                               activities from design to operation
        promotes
     reuse of services
                                               Reusability                          An architecture approach that
                                                                                   promotes service designs which
                                                                                       are business-meaningful
                                                          2
                     Flexibility
                                                         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

				
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