Business Technology and Enterprise Architects at Open Group SOA for Business Technology provide a overview of the recent white paper published in the presentation at Open Group Boston Conference today 07/22/2014, #ogBOS
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>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
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Overview: a world of SOAs
A slow but relentless revolution in which traditional technology management, historically delivered only by an IT organization, is changing to be pervasive technology use managed increasingly outside of IT’s direct control and measured by boosting business results.
• Business Technology
The coalescing of the Business Ecosystems and SOA Ecosystems are Business Technology real
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
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Overview: Some background
Modern business environments have evolved into an ecosystem of:‒ Internal “SOAs”, driven by internal IT‒ An external “ecosystem” of partners & customers with a Micro Services API environment‒ An external (and sometimes internal) cloud ecosystem of service providers and consumers
Organizations are naturally adopting “Service Orientation” as a way of doing business
‒ They are becoming “Service Oriented Enterprises”
This presentation is about Service Orientation and its:‒ Business & SOA implications ‒ Business and SOA alignment enabled by SOA‒ The impact of Business Structure and Culture SOA adoption
Service-orientation is a thought process closely related to value chain thinking with a focus on Business efficiency & effectiveness
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
• Business Executives and Management– Talking SOA to the Board– Talking to Line-Managers and Mid-Level executives
• IT Executives and Implementation– The SOA RA and OSIMM
• Enterprise Architecture– How do I handle this new ecosytem?
• Systems Integrators– A common understanding that the business and IT customers can share
What’s in it for me?!
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The coalescing of SOA and Business requires stakeholders from both IT and the business to think Service Oriented. This presentation should provide an introduction of the concepts involved.
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
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Some quick terms….
So what is a “Service Oriented Enterprise”?‒ A Service Oriented Enterprise is an organization that orients itself in a Service Oriented
manner, with the following characteristics It defines Business Capabilities in terms of Business Services Business Functions in terms of Business Processes It measures Business KPIs to determine success
"When I use a word," Humpty Dumpty said in rather a scornful tone, "it means just what I choose it to mean -- neither more nor less.“"The question is," said Alice, "whether you can make words mean so many different things."
A Service Oriented Enterprise (SOE), over time, becomes structured to operate based on services rather than organizational units
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
10
Some quick terms….
Some other terms…
‒ Business Services – those services that an organization considers its delivered services. The organization measures itself in terms of metrics related to these services, or consolidated metrics. Business Capabilities are composed of Business Services
‒ Business Functions – the operational functions which keep the organization running. Business Functions are composed of Business Processes.
‒ E.g. Provider Servicing with processes for claims submission, claims inquiry, etc.
‒ Business Process - A Business Process is defines the behavior from the ‘How’ (how work is done) perspective
Business Services are what the organization provides. Business Functions are what it does in order to provide Business Services. Business Processes are how business functions are done.
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
• Scorecards– Rolled up to an enterprise level, typically aligned on a Kaplanesque model to reflect factors of
business importance (customer satisfaction, employee satisfaction, revenue, etc.)– Business executive stakeholder understand and measure success based on these.– They can be tactical and strategic
• KPIs and Metrics– KPIs and metrics measurable attributes, typically at unit or program level, that can be rolled up
to the scorecards. They are often used to measure how an organization is aligning with its goals.
• Examples – Common scorecard measures for a Healthcare organization may be patient safety and
satisfaction– Common KPIs for a Healthcare organization may be raw mortality rate and patient
comorbidity rates
Businesses measure how they are doing..
The Business Perspective
Service Orientation is uniquely positioned as a business and technology architectural style to capture and compose metrics, and measurability is a key factor in modern businesses, especially due to its impact on efficiency and agility
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
• Strategic– The Strategic Pillar addresses organizational strategy, orienting the organization around the
organizational mission, vision and goals.
• Operational– The Operational Pillar addresses how an organizational executes. This includes the functions
and organizational structure to run the business. The underlying business processes and services to run the business.
• Operating Model– The Operating Model Pillar addresses the manner in which an organization is run. The
structure and culture of the organization are factored into this. It is a very effective tool in assessing organizational readiness to adopt the SOA Ecosystem. Governance, culture and metrics are key aspects of this.
A Reference Model for SOA in the context of SOA
The Business Perspective
A Service Oriented Enterprise measures how it operates. It uses Business Services as a paradigm to determine how and what it does. It uses a capability based Strategic Model to determine how it works and an Operational Model to run the organization. It uses the Operating Model to determine prioritization.
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
Pillar 1: Business Vision and Strategy
Business Vision & Strategy aligns mission, vision and goals around capabilities and Business Services
Activities + Org. Struct.
Operational Execution defines how an organization is run.
It is the “runtime” expression of a Service Oriented Organization.
In a Service Oriented Enterprise it translates to organizational structure and the business process required to run the organization.
Operational Execution
Activities + Org. Struct.
SOA Governance ensures consistency and alignment.
Business function alignment with the requisite organizational and process structure is enabled through governance frameworks
Alignment
Business Strategy expressed as Mission/ Vision/ Goal
Business Capabilities
Technical Capabilities
Business Vision & Strategy
Business Vision and Strategy in organizations gets defined in terms of organizational mission (the fundamental question of why an organization exists and why it is in business), vision (an aspirational definition of how the organization will approach realizing the mission) and goals (specific, quantifiable targeted activities that need to occur to realize the missions). These goals are expressed in terms of objectives or KPIs or measurable metrics. Strategies require capabilities to be realized, and business strategy can be expressed in terms of the business capabilities required to realize them. From an implementation perspective, there need to be corresponding Technical Capabilities and constraints – and the SOA RA and OSIMM provide a model with which to align with an organizational roadmap to realize organizational strategy – in a quantifiable and agile manner.
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
Pillar 2: Operational Execution
Size is not a factor. Most if not all business measure success. The How and What may vary.
Business Operations + Value Chain/ Supply Chain
Business Processes (enabled using the SOA RA capabilities)
Invoke Service Orchestrations & Workflows
Using Services from the Service Catalog
Activities + Org. Struct.
Business Vision & Strategy
In a Service Oriented Enterprise, the business orients itself around processes and Business services, with measurable metrics. Business strategists think in terms of business capabilities, KPIs and how business orientation can lead to business success. Mission, Vision and Goal mapping , measured in terms of KPIs drive this “service orientation”
The SOA RA in particular provides a generic set of technical capabilities by layer.
These capabilities enable the technical and business capabilities required to execute business vision.
The Business Vision and impact.
SOA Governance ensures consistency and alignment.
Business function alignment with the requisite organizational and process structure is enabled through governance frameworks
Operational Execution Alignment
The Operational Business Architecture is defined by the Business Functions required to support the Businesses Operations . The Business Functions are composed of Business Processes and enabling capabilities. The Business Processes in turn invoke Services (or other Business Processes) through orchestrations or workflows.
This is leads to service reuse and the business benefits of agility, cost reduction and information consistency.
Business Functions (in Operational Business Architecture)
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
Pillar 3: The Operating Model
Operating Models relate organizational structure and culture, providing a mechanism to assess priorities, and the governance fabric to execute the SOE. The SOA provides the enabling framework.
Activities + Org. Structure
SOA Governance Execution
Business Vision & Strategy
Operational Execution defines how an organization is run.
It is the “runtime” expression of a Service Oriented Organization.
In a Service Oriented Enterprise it translates to organizational structure and the business process required to run the organization.
Business Vision and Strategy in organizations gets defined in terms of organizational mission (the fundamental question of why an organization exists and why it is in business), vision (an aspirational definition of how the organization will approach realizing the mission) and goals (specific, quantifiable targeted activities that need to occur to realize the missions).
Goals are expressed in terms of objectives, KPIs or measurable metrics.
Strategies involve capabilities to be realized.
The SOA RA and OSIMM provide an initial set of capabilities and a model with which to align an organizational roadmap to realize organizational strategy in a quantifiable and agile manner.
Operating Models provide a background on which to help determine the fit for organizational structure, culture and help focus the areas in the SOA. Compliance and regulatory constraints, coupled with market, technical and business drivers, coupled with organizational cultural maturity help frame an organizational readiness and adoption model and a SOA Governance framework.
This forms the underlying basis for SOA adoption and transformation to a Service Oriented Enterprise.
The third pillar is the basis for the people and process part of SOA4BT – and an integral part of the creation of a successful SOE
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
• The Operating Model Pillar addresses the manner in which an organization is run.– Provides a governance fabric
• Fiscal Models– How they spend, who is accountable, and who approves
• Cultural Structure – How does executive management view the organization? How is it measured?
Pillar 3: The Operating Model
Define the governance framework to define how you will get the “people” part of your organization to execute. Use the operating model to decide what to focus on.
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
• Traceability from organizational drivers through service orientation starts with alignment on mission, vision and goals
• Vision is aspirational, mission lays out tangible direction and how it will be achieved
• Understanding business drivers is fundamental to effective transformation to a SOE
• Business drivers categories that SOA is especially suited for:– Speed and Time to Market/ Cost/ Agility
Business Drivers and SOA
The Role of Business Drivers in a SOA
Boards do not understand services created or components reused. However, they do understand improved customer service numbers, or improved time to market or cost.
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
• Regulatory • Disruptive (either due to technology or business reasons)• Innovation (leading to disruptive drivers)• Complementary capabilities achieved through partnerships (typically
establishing market drivers)• Substitute products (the threat of substitute products forces changes in
business models)• Established rivals (driving competition, threatening margins and value)• New entrants • Supplier bargaining power• Customer bargaining power.
Business Drivers
A Taxonomy of Business Drivers
Business Drivers change how a business must operate. They may change its business services. A Service Oriented Enterprise is uniquely positioned for this change.
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
• SOA RA is an enabler
• SOA OSIMM as a rubric
• SOA4BT to communicate and pervade
Success Factors
Success for a SOE
Moving to a Service Oriented Enterprise is a journey. However, modern business drivers of cost, globalization and agility make this easier to understand and justify
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
The Enabler: The SOA RA V1
The SOA RA
The SOA RA provides a reusable set of capabilities, architectural building blocks and an underlying framework to make SOA actionable
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The SOA RA consists of 5 “functional” layers and 4 “cross-cutting” layers
1. The SOA RA1 provides an industry standard set of capabilities and architectural building blocks for each layer, based on best practices and lessons learned from a number of global organizations of various sizes and line of business
2. We use the business capabilities, industry trends and drivers and best practices to further constrain and define the capabilities to be supported, and define solution architectures
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
The Enabler: The SOA RA V1 also be applied to other parts of the SOA Ecosystem, including the Cloud
The SOA RA and the Cloud Ecosystem
The Cloud is a particular expression of SOA. The SOA RA provides a fundamental fabric around which we can design cloud architectures
1 TOG 2012, Kumar (2012, 2011)
Private Cloud Hybrid Cloud Public Cloud Community Cloud
BPaaS e.g. LocationIndependence, Elasticity, Multi-tenancy, Meter for QoS
SaaS E.g. Meter for QoS –Chargeback
PaaS IaaS
The TOG SOA RA cross-cuts the matrix.Map it to your cell/s
Cloud Service Models
Deployment Models
C o n s u m e r I nt er fa ce s
B u s in e s s P r oc e ss e s
S e r v ic e s
S e r v ic e C o m p o ne n ts
O p e r a t io na l S ys te m s
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e1. Use the Matrix to determine which cell is appropriate. The Matrix has a set of characteristics* which typify the Cloud. These characteristics help identify which cells apply to you.
2. Use the SOA RA to determine your capabilities & ABBs
3. Ref ine it by applying the model and Constraints
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
The Enabler: The SOA RA can be used to derive solution architectures1
Actionable Execution
The process of translation to an actionable asset is expressed through the mapping of business capabilities and constraints to the creation of an actionable SOA
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
The Business Perspective
1 Kumar (2012)
• The TOG SOA RA and OSIMM enable Roadmapping – The OSIMM forms a rubric to assess conformance– The RA provides the what and how– Used together, you can plot how to evolve an RA and respond to change
Using It! Roadmapping
Business Capabilities
• Align against Business Drivers
Technical Capabilities
• The SOA RA provides an alignment to ABBs and Layers
>ApTSi TM – Applying Technology to Solve Business Problems TM
The Open Group Conference, Boston July 2014
Alignment and Traceability
Size is not a factor. Most if not all business measure success. The How and What may vary.
Enterprise Strategic Business Architecture
Balanced Scorecard
BU Balanced Scorecard
BU Balanced Scorecard
Scorecard (e.g. Kaplan variant) used to rollup into business significant measures:1. Map to specific organizational needs2. Reflect Kaplan-esque attributes
Scorecard (e.g. Kaplan variant) used to rollup into LOB measures:1. Map to specif ic LOB needs2. LOB Strategy3. LOB goals/ objectives/ KPIs
SOA integration with Enterprise Strategy
KPIs + Metric
SOA Governance decision process
Architectural decisions
KPIs/ Objectives:1. Roll up to organizational/ BU goals2. Have def ined metrics with units of measure and ways to measure
Maps to SOA governance and architecture decision points