Panel: SOA's new role in the coming economic expansion

'SOA is a response to being big, and how to manage IT in a climate where things are growing'
Written by Joe McKendrick, Contributing Writer

Quite a bit has been said about the role service oriented architecture plays in helping to streamline and consolidate IT operations in a tight economy. Now, as we move into a recovery and growth phase, it's time to look at the role SOA will play in business expansion -- and how to oversee that role.

'SOA is a response to being big, and how to manage IT in a climate where things are growing'

I recently had the opportunity to join Miko Matsumura, vice president and deputy chief technology officer for Software AG, and John Favazza, vice president of research and development for WebLayers, in a roundtable discussion about the role SOA will play in renewed business growth, and how effective governance can make this happen. (Listen to the audio Webcast here, or read the full transcript here.)

Miko and John agreed that predictions of the collapse of SOA endeavors in the recent economic slump did not pan out -- companies remained committed to moving forward with SOA. Now, with a recovery shaping up, SOA may play a key role in strengthening companies for the next growth phase. The challenge will be effectively governing the way SOA evolves.

John said that he saw some moderation of SOA efforts, but no one engaged in cutbacks of any kind over the past year. "We've seen [customers] maybe slow down the projects they are working on, so they push out their timetables," he related. Companies seemed to take two approaches to SOA during the economic slowdown, he observed.  "Some are locking things down and becoming more tactical," he said. "Then we have this other group of customers, a smaller group, who actually used this downturn to focus on strategic initiatives. Their plan was when the economy starts ticking back, they're going to be well prepared."

Miko also reported seeing more investment in SOA strategies to help prepare for the next economic upswing. "We see people who are investing in expanding their capacities and capabilities going forward." He also pointed out that as we enter a growth phase, governance will become critical as companies seek to apply SOA approaches to their siloed organizations and siloed technology infrastructures. "The thing that I think is really important from a growth perspective is this notion of complex demand, as an organization grows to a significant size," he said. "They experience market fragmentation, they have to expand to new customers, they have to start to verticalize, geographically localize, and offer more niche versions of products and services."

In turn, this leads to more complex consumption of IT capabilities, he continued. "It means you have more channels. You have more leverage. more reach. and more mass customization. You need capabilities to serve a much larger number of potential customer silos, which is part of the fragmentation that comes with the size of enterprise."

This complexity will demand more service orientation, and more comprehensive governance of resulting services. John added that "as the economy grows, there's going to be more pressure on the IT organizations that are there today. We're seeing a lot of them become more distributed. The reason we think that governance is so important is now there are teams all over the world, and there are all these technologies. The governance needs to be automated all these different groups to make sure the policy enforcement is done more appropriately."

Governance is even more critical as an organization grows and breaks into subgroups and silos. As the organization gets more complex, it may drag on growth and agility. This is where prudent SOA governance enters the picture, Miko said. "The SOA value is being able to sustain the competitive advantage of size, but also to be able to continue to compete in the marketplace."

There are benefits in bigness, of course, in terms of global reach and mass buying power, Miko added. "But unless you can really coordinate align multiple tribes and silos, you're going to be a failure competitively. As we move into the growth stage, the fragmentation of your market will be difficult to address, because you will have single-point solutions."

"SOA is a response to being big, and how to manage IT in a climate where things are growing," he added.

(Only 30% of IT executives in a new McKinsey & Company survey say their IT governance is business-ready. Details in my next post.)

John and Miko also discussed the potential of a greater role for the project management office -- and even procurement department -- in SOA governance. Miko Matsumura, for one, said he is "seeing some amazing alliances" between the PMO and enterprise architects in the sense that "PMO is sort of the approval choke point of all projects. That is actually now starting to potentially open up to EA with respect to this notion to getting architectural review."

This adds even more teeth to SOA governance as well, he added. "You have to answer to EA and PMO together."

Another party that is increasingly weighing in on SOA governance decisions is the procurement department, Miko continued. "Procurement is stepping up and saying, 'you're going to buy what to do what?'"  The procurement department also has teeth in the equation, since "ultimately at the end of the day the enterprise is going to have to pay the bill, especially when it comes to non-interoperable solutions that come from really scattered dispersed vendors."

John also is seeing more project management methodologies enter the SOA governance equation as well. "I do see that as eventually a lot of these project management tools and capabilities will merge with a lot of these governance technologies."

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