1 Software architecture adjustments for a changing business

2 Business is Changing

3 Observations Business: Outsourcing Business Processes Outsourcing IT Integrating Internal and External Processes Focus on Core Competence and Compliance Mergers and Acquisition IT Architecture Innovation (SOA) Consolidation of Applications Focus on Integration and Flexibility Offshore activities

4 Pressure on IT

5 The CIO Challenge Pressure from various angles Reduce IT budget Ensure Regulatory compliance Provide 360° view of business Deliver new services, faster Lines of Business CFO Auditors CEO

6 Requirements Business Agility requires IT Flexibility IT Flexibility requires Flexible infrastructure Flexible infrastructure require SOA Successfull SOA requires Standards Application Integration Platform Data Integration Platform

7 The 3 adjustments for Success Integration and Innovation Projects Integration Competency Center (ICC) Approach Long Term Blueprint (SOA, EDA) Architecture Scalable and Flexible Platform Technology

8 The Evolution of Integration Legacy Applications Key applications functioned independently Data and application logic lumped together on isolated systems The mainframe era Integration not a priority ERP Applications Core back office functionality packaged into customizable modules Single-vendor providing tightly coupled applications Integration restricted to a few applications (CRM with Financials, etc.) Application and Data Integration Multiple vendors providing different critical application components Information assets distributed across heterogeneous systems Application and Data Integration become TOP priority

9 Data Integration for the Virtual Enterprise Legacy Migration Consolidation Synchronization Master Data Management Consolidated View Single View of Business Composite Apps SCM HR Custom PLM CRM ERP In-House Process Outsourcing: Increases Integration Complexity Strategic Value of Information Query & Reporting, Dashboards Data Warehouse Automation of Transactions & Operations Sales Force Automation Payroll Receivables Other Payables Service Provider

10 Silo based architectures of the past Mainframe DB CRMHR Fin OE Biz Logic

11 Dependencies between systems grew Mainframe DB CRMHR Fin OE Biz Logic

12 Resulting in the Accidental Architecture Mainframe DB CRMHR Fin OE Biz Logic

13 Technology confusion Vendors have delivered functionality in various forms and packages to meet these Integration needs over time: ETL (Extract, Transform and Load) MOM (Message Oriented Middleware) EAI (Enterprise Application Integration B2B (Business to Business) Workflow BPM (Business Process Management) BAM (Business Activity Management) EII (Enterprise Information Integration) ESB (Enterprise Service Bus) What technology or combination of technologies is right for my project?

14 Service-Oriented Architecture An integrated software infrastructure and design approach to expose business relevant data and application services in a loosely coupled, standards based form. SOA - Leverages web computing standards (XML, SOAP, etc.) Promotes wrap and reuse of existing IT assets Metadata-driven to maximize portability

15 Two Types of Integration Enterprises have two major type of IT assets they need to integrate These are two different integration problems which require different technologies & approaches Business LogicData Application & Process Integration Data Integration

16 Consolidate Customer Systems Outsource HR Integrate New Merger Upgrade Sales Comp Systems Integrate with Hewitt Complex integration environment increases costs and impedes flexibility Upgrade Risk Mgmt System Migrate Legacy Finance App. Consolidate Risk Systems Integrate Customer Analytics Data IT Initiatives Requirements for Accessing, Integrating & Moving Data Business Initiatives Reduce Lending Risk & Fraud Increase Customer Cross-sell & Loyalty Regulatory Compliance Mainframe Applications Databases XML Flat files Messages Unstructured Data Enterprise Data EAI App vendor tool FTP SQL Scripting Data Integration Custom code Hand coding BI ETL Tool SQL Scripting EAI App vendor tool SQL Scripting Custom code BI ETL Tool Incomplete, inconsistent view of data Costly, one-off development efforts High maintenance & administration costs No reuse of code or skill sets Brittle infrastructure hard to change

17 The Importance of Data Integration in SOA “Companies must build a solid data services layer; Otherwise SOA benefits will NEVER be realized” “The vast majority of companies must have a data integration strategy to accommodate change.” “SOA’s success is contingent on a data integration strategy” “SOA will fail if long-standing data quality, data redundancy and semantic inconsistency issues are not addressed.” “Organizations must address data integration issues during their SOA implementations.” AMR Research “Data Integration, Foundation for SOA”, September 2005 Gartner “Data Integration Is Key to Successful Service-Oriented Architecture Implementations”, October 2005 “In utilizing service-oriented architectures (SOA) for integration projects, IT departments should seek to avoid two commonly made mistakes: giving insufficient attention to how data will flow over the underlying architecture, and insufficient use of metadata.” Nucleus Research “SOA: The Two Biggest Mistakes to Avoid”, November 2005

18 Service-Oriented Enterprise Integration Mainframe DB Biz Logic FinSAP Backend IT Assets Data and Metadata Integration ( Data Access, Profiling, Cleansing, Aggregation, Transformation ) Application Integration ( Access, Reliable Messaging, Transactions ) Business Processes (orchestration) Portal Reusable Data Services (complex transformation, data quality check) Reusable Application Services (pub/sub channels, transaction monitor)

19 Conclusion Business forces IT to innovate Outsourcing increases complexity Adjustments in IT focus on SOA Regulations will push IT even more