Is SOA delivering value? We need to understand this better

Loraine Lawson just posted some thoughts about the results of a new qualitative study, sponsored by SAP and conducted in conjunction with the University of St. Gallen, which suggests that businesses are starting to see some results from SOA initiatives.

Most organizations simply don't know what business fruit their SOAs are bearing

There are two ways SOA is delivering value, the study observes. First is the IT-centric approach aimed at increasing the efficiency of IT operations through resource reuse and elimination of duplicated efforts, and second is the enterprise approach which seeks to enable greater business agility.

Of course, there are organizations leveraging SOA at both levels. Loraine points to an anecdotal account from the SAP-St. Gallen study of Burda Digital Systems, which saw both IT operational efficiencies as well as enterprise gains. Burda CEO Gerhard Thomas said SOA not only cut IT operational costs by 10-20 percent and IT project length by 20-30 percent, but "also helped increase process efficiency of between 10 to 30 percent, and also benefit from improved process quality due to consistent data and role-specific process design."

Burda not only had the advantage of a well planned -- and apparently well-governed -- SOA initiative, but also had the metrics that could show where and how SOA was improving the business. Developer productivity and IT operational costs are a fairly straightforward measure, and can be readily linked to SOA efforts underway. But measuring the impact on business process efficiency is another story. Burda captured this, but then seemed vague about the "benefit from improved process quality."

As detailed in previous posts here, some analysts say that demonstrable SOA success stories have been few and far between. (Just ask Anne Thomas Manes.) Why is this? First and foremost, most organizations are only in the initial phases of SOA, and are still evolving out of JBOWS architectures (and will be for some time). Second, SOA requires effective governance, and most organizations are just beginning to get their arms around the tools and structures necessary to make this happen.

Third, organizations don't know if their SOA is succeeding because they're not measuring it. SOA initiatives need the metrics or key performance indicators tying business success to their efforts. Burda, mentioned in the SAP release, seems to have been able to measure the impact of its SOA efforts on business process efficiency, but most organizations simply don't know what business fruit their SOAs are bearing.

Countless CIOs or IT managers I have spoken with know instinctively that they're seeing increased business user satisfaction and better integration, but few have had actual metrics.

A couple of weeks back, I had the opportunity to join SAP's Christian Hastedt Marckwardt in a Webinar (registration required) exploring the results of another recent survey SAP had commissioned in partnership with ebizQ to explore these very issues. The survey confirmed that even companies with the most advanced SOA deployments – in terms of enterprise reach and number of reusable services – have yet to formulate governance strategies or methods to measure the value of their SOA to the business.

The survey also found that only one out of seven companies currently have active governance efforts underway. Even among the most advanced sites, two out of three still do not yet have comprehensive governance programs in place. And many see their current or planned governance programs as being ineffective. In addition, few, only 17 percent, have even the most fundamental foundational metric -- enterprise reuse rates -- to help gauge the success of their SOA efforts.