Commoditizing processes

Business process are in the process of being commoditized, according to a recent article by Thomas Davenport in the Harvard Business Review. That's an important trend as far as the continuing evolution of SOA is concerned.

Business process are in the process of being commoditized, according to a recent article by Thomas Davenport in the Harvard Business Review. That's an important trend as far as the continuing evolution of SOA is concerned. It promises to help lay the groundwork and build demand for new Web services that will enable the redesign, refinement and execution of standard business practices that deliver repeatable and predictable levels of business performance.

As I see it (and have written it), the fates of the SOA and BPM (business process management) movements are intertwined. After all, the services we speak of in this space (and in many recent business technology conferences) are essentially meaningless if they cannot be tied to business processes. Processes are the mechanism by which work gets done and value created.

Davenport has observed that some efforts to analyze, standardize and quality check business processes are moving faster than others. Software development processes, for instance, are being enshrined in the capability maturity model (CMM). The Supply Chain Council has its Supply Chain Operation Reference (SCOR) model. MIT has created an online library of more than 5000 processes. American Productivity and Quality Council has introduced a Process Classification Framework that describes nearly all of the most notable processes in an enterprise.

We are in the process of mapping out the wilderness of process-based activity. As the maps and measurements are refined, our ability to break down and outsource these processes will grow. In some cases, we will look to business process outsourcing (BPO) firms to take over the activities that we do not consider core. But, in other cases, we will merely invoke services that enable us to execute relevant processes. The services themselves, in fact, may embody large swatchs of the processes we seek to automate -- much as Amazon.com now exposes Web services that enable less advanced web retailers to execute advanced commerce services.

"Process standards could revolutionize how businesses work," writes Davenport. "They could dramatically increase the level and breadth of outsourcing and reduce the number of processes that organizations decide to perform for themselves. With objective criteria to evaluate whether a company can save money or get better process performance by outsourcing, it's likely that more firms will take advantage of external capabilities. As the global market for process services matures and providers learn what it takes to succeed with a process according to the standard, the number of providers will undoubtably increase, and the prices of their services will likely drop."    

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