The Future Of Business Interoperability Randy Heffner Vice President Forrester Research May 11, 2006 Download this presentation at:

3 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Major source of business pain: IT responsiveness Business is facing: »Global business models and competition »Rapid innovation and fast-changing industries »Regulatory compliance challenges »Increasing cost pressure IT’s response: »Slow delivery times »High maintenance costs »Brittle solutions

4 Entire contents © 2006 Forrester Research, Inc. All rights reserved. But SOA is the answer, right? The majority are using SOA They are quite happy and doing more SOA They look for it to have a big impact

5 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Shift to digital: How much IT is in your toothpaste? Physical world Digital world Total economic value 1950s2000s Accounting systems Inventory systems Scanners Data warehouses RFID 100% physical world stuff... Supply chain mgt

6 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Digital technology covers the business landscape Business depends on technology Business is embodied in technology

7 Entire contents © 2006 Forrester Research, Inc. All rights reserved. 10 stories, built 1884–85, Chicago Home Insurance Company Building Source: Encyclopædia Britannica 16 stories, built 1889–91, Chicago Monadnock Building (north half) Source: Wikipedia

8 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Future structure of IT: Digital Business Architecture

9 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Traditional solution delivery = frozen processes Business specs a system  IT hardcodes  Process gets frozen  Company becomes unadaptable 

10 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Digital business delivery = flexibility for change Business & IT design a process  Business design encoded as metadata  Metadata drives technology  Making company adaptable  Actively embody your business in your technology

11 Entire contents © 2006 Forrester Research, Inc. All rights reserved. BUSINESS METADATA CORE Business Metadata Core: Architectural center Presid ent & CEO Marke ting Sales Weste rn Diviso n Easter n Divisio n Partne r Chann els R&D Peopl e Produ ction Onsho re Offsho re Distrib ution Legal Security policy Data privacy & security Process definitions Organizational structure Metadata repositories Service policy, monitoring, etc. Standards play : Policy, business models, metadata integration SOA

12 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Business Services = your business in the digital world Standards play : SOA, policy, packaging, versioning BUSINESS METADATA CORE Composite services and data Digital world Digital business services Service delivery network Product inquiry Reserve inventory Schedule shipment Create customer order Create supplier order Schedule production Services can initiate digital processes Digital business processes SOA ERP CRM Vertical apps Custom apps SCM Data grids Rules engines

13 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Pervasive Interactions connect digital to physical Standards play : UI specs, full process, interaction integration BUSINESS METADATA CORE Pervasive Interactions Business Services Proactive care process Medical device Voice interface Content mgt Online charts End-to-end SCM process Point of sale Web services RFID Robots RFP process Collaboration Word processing Content mgt Mobile devices Movie night process Interactive TV Home content mgt Calendar Pizza Digital homeComplex salesMedical deliveryDistribution Unified Communications

14 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Unified Communications as “just another application” Standards play : Policy, collab services, channel integration BUSINESS METADATA CORE VoIP Collabor- ation Core apps “Role calling” IM promote-to-voice Auto-mp3 & transcript “We interrupt for a message about the Smith proposal” Critical event capture Enterprise content Security Pervasive Interactions Unified IP network Presence-based notification Voice + app collaboration Video sensor event Presence Location Context Policy

15 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Organic IT: Raise management to the business level Standards play : Policy-process-resource ties, config mgt BUSINESS METADATA CORE Configuration management database Storage Application server Digital business services Firewall Linux Digital business processes Order entry process Windows Supply chain process Server alarm sets off business alarm Smart resources for auto-config Automated management performs auto-recovery Virtualized resources are flexible and configurable

16 Entire contents © 2006 Forrester Research, Inc. All rights reserved. The virtual firm: True business interoperability Company B Unified Communications Pervasive Interactions Organic IT Infrastructure Business Services Business Metadata Core Unified Communications Pervasive Interactions Organic IT Infrastructure Business Services Business Metadata Core Company A Integrated business services Interconnected collaboration networks Unified cross- boundary processes

17 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Standards agenda for business interoperability Business metamodels and metadata integration Comprehensive, cross-boundary process specifications Specific policy types Deep configuration management and packaging Interaction specification and integration Collaboration and unified communications Standards for business embodied in the digital world

18 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Related Forrester reports “Digital Business Architecture: Harnessing IT For Business Flexibility” November 7, 2005, Best Practices “Survey Data Says: The Time For SOA Is Now” April 14, 2006, Trends “Digital Business Architecture: IT Foundation For Business Flexibility” November 7, 2005, Forrester Big Idea “How Composite Apps Will Change Enterprise Application Development” July 20, 2005 Trends “Market Update: SLM/BSM Technologies” November 9, 2004, Market Overview “The Big Strategic Impact Of Organic Business And Service- Oriented Architecture” June 18, 2004, Trends “Organic IT 2004: Cut IT Costs, Speed Up Business” May 18, 2004, Trends “Unified Synchronized Communications Arrives” February 24, 2004, Trends

19 Entire contents © 2006 Forrester Research, Inc. All rights reserved. Randy Heffner Thank you Download this presentation at:

Supplementary material

21 Entire contents © 2006 Forrester Research, Inc. All rights reserved. The mental model shifts of Digital Business Architecture From: First design your business, then design systems to support it To: Concurrently design your business and the systems that embody it From: Write application code to serve dedicated business functions To: Create digital business capabilities ready to deliver in a digital world From: Design a user interface for a business function To: Optimize physical world process endpoints as you connect your digital business to users & devices From: Find the right network on which to deliver a message To: Do multi-channel, cross- channel collaboration on a unified network From: Install my application on a server To: Allocate resources to my business process Overall Business applications User interfaces & sensors Communications & collaboration IT infrastructure

22 Entire contents © 2006 Forrester Research, Inc. All rights reserved. What do you do about Digital Business Architecture? STOPSTART STOP writing requirements documents for IT. START cross-boundary process governance, including IT. START optimizing business process endpoints. STOP designing user interface screens. START building process-ready digital business capabilities. STOP delivering applications for targeted functions. START joint business-IT analysis of business problems. STOP treating business and IT as two different worlds. START using architecture for strategic business flexibility. STOP using architecture merely for cost-saving standardization.