perspectives on soa roi
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Karsun Solutions. Robert D. Bryan {[email protected]} Brand K. Niemann {[email protected]} Kartik Mecheri {[email protected]}. Perspectives on SOA ROI. April 8, 2011. Some Perspective On SOA. - PowerPoint PPT PresentationTRANSCRIPT
Perspectives on SOA ROI
April 8, 2011
Karsun Solutions
Robert D. Bryan {[email protected]}Brand K. Niemann {[email protected]}Kartik Mecheri {[email protected]}
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Some Perspective On SOA
"SOA is a natural step in the computing trend towards integrating and reusing capabilities rather than reinventing them, SOA holds the promise of making an IT portfolio more efficient and agile.“*
Departmental perspective - the investment required for SOA might indeed seem large.
Organization-wide perspective - the return on investment due to efficiency becomes evident.
“Instead of 10 different departments building 10 similar software services from scratch an organization can build it once, build it well, and share it.“
Success w/ SOA really boils down to "we are successful together or we fail together"
*Geoff Raines mitre.org/news/digest/enterprise_modernization/09_08/external.html
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Why You Do SOA ... In This Order
*Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010
Business Objectives - First ... Second ...etc. Technology Objectives Count For Little If No Business Outcome
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Gartner - What’s the Business Value of SOA?*
•SOA has an indirect impact on business outcomes
-SOA enables development of systems the organization needs to achieve its goals
-The business benefits of these systems are a second order outcome of SOA investment
•Comparisons across projects or organizations are problematic
•Baseline metrics are seldom available
*Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010
Difficult to build a generalized SOA business case
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Difficulty Proving the Business Value of SOA*
•In a 2009 Gartner survey, 36% of respondents say lack of business justification impedes SOA adoption
•Only 1% said they measured benefits
•Very difficult to measure value of a “SOA initiative”
•Requires TCO metrics (which few people measure)
•Much easier to measure the value of specific projects, although this undervalues SOA**
•SOA projects should be measured in business outcomes that translate into hard cash
•IT leaders must work with business leaders/finance to establish a solid business value metric system
*Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010**Companion Guide To Software AG’s SOA Value Assessment Using SOA And BPM To Drive Business Optimization – Forrester Research - 2007
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Others - What’s the Business Value of SOA?*
•Requires only 20% additional cost to build core reusable services (e.g., Relative Cost of Writing for Reuse - RCWR for Reuse=1.2)
•Save 90% of development costs for each reuse of a SOA service (e.g., Relative Cost of Reuse - RCR =.1)
•Quickly increase levels of reuse by 2.5x on applications.
•Lead to further, as yet to be quantified savings in quality, productivity, and time-to-market.**
*“ROI of SOA - Based on Traditional Component Reuse” – Poulin – 2006
** Query in to Poulin regarding more recent findings on time-to-market
SOA Experience
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Multiple Conflicted Views Regarding ROI
On One Hand : *ROI must be calculated uniquely for each organization, and it must address the financial implications of the following – there is NO single ROI formula for SOA:
• The number of siloed applications affected.• The number of business process (and nested sub-processes).• How much business logic needs to be separated from computer logic.• The amount of value currently contained in packaged applications.• The number of adapters and “black box” components needed; the amount of effort required to carve out and build in reuseability for each.• The scope of business applications that can be integrated.• The number of duplicate software processes that can be rationalized.• The number of data definitions that need to be harmonized.• The value in regulatory compliance and better audit procedures.• The value of increased agility or responsiveness to change; the value in being able to change business processes (and the related software processes) to meet strategic opportunities.• The extent to which future changes become easier (and less costly).• Changes in training requirements.• The time horizon for SOA development.
On The Other Hand : Some basic ROI calculations appear to be available - Jeffrey Poulin** (this has not been confirmed / tested)
*Companion Guide To Software AG’s SOA Value Assessment Using SOA And BPM To Drive Business Optimization – Forrester Research – 2007
**LM Certified Systems Architect, IEEE Certified Software Engineering Professional, Lockheed Martin, Owego, NY http://jeffreypoulin.info/html/reucalc_basic.html
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Recommendations from Gartner*•Don’t focus on proving the value of “SOA”
-SOA benefits are too abstract, hard to prove causally
•Do focus on proving the value of SOA projects-Use rigorous metrics to measure business outcome-Aggregation of SOA projects will eventually prove SOA value
•Define standard business value metrics -Work with business/finance -Measure impact on the bottom line
•Measure the business value of each SOA based business need that is met, then measure how SOA helped produce that value•Business value is seen in both positive metrics and cost avoidance•Decide upfront on the metrics for each project•Communicate the value of SOA on an ongoing basis
-Don’t wait for “big-bang” benefits; all results are good*Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010
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2009 Survey of SOA Objectives**
**Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010
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The Collision Course of Portfolio Bloat**
Maintenance is 92% of TCO *
*Andy Kyte. “A Framework for the Lifetime Cost of Ownership of an Application.” Gartner.30 March 2010
**Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010
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Immediately Available Tactical Ways Forward
Possible Ways Forward
• Systemically Compare Costs and Time**– Estimate Projects Using SOA– Estimate Projects Using Legacy
• Implement Measures of Effectiveness* (MOE) – $$$ For Innovation (Expanded Or Recapitalized Business Capabilities) vs. $$$ For
O&M– Cycle Time From Management Approval To Implementation Of A Solution
Could Be Integrated or Closely Aligned With PMO’s Portfolio Management Function)
*“Enabling the Mission” A Practical Guide to Federal Service Oriented Architecture p. 22-23
**Gartner AADI User Panel: Measuring the Value of SOA - June 2008 - http://www.soa-consortium.org/podcasts-webcasts/Gartner-08/podcast-p1.htm
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Examples Of Possible Efficiency Metrics*
*Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010
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Credible Reuse Metrics - Examples
Use Metrics That ‘Fit’ Your Organization And Focus Heavily On Business Outcomes* – Not IT Outcomes!
*Anne Thomas Manes – Gartner - SOA Symposium –Berlin -October 2010
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Top 10 Reasons SOA Fails*
*http://www.cio.com/article/438413/Top_10_Reasons_Why_People_are_Making_SOA_Fail?page=1&taxonomyId=3016
Failures Are Usually Due To People And Cultural Issues More Often Than For Technology Issues
Fail to explain SOA's business value - SOA needs to solve real business problems
Poor project management - If your organization struggles now, it will struggle twice as much
Underestimate the impact of organizational change - SOA brings massive amounts of change
Think of SOA as a project instead of an architecture - Gone are the days where one person is the SOA architect, developer, data architect, network architect and security specialist
Fail to secure strong executive sponsorship - SOA spans many departments and requires a strong executive with clout
Underestimate the complexity of SOA - It is not a hard concept to understand, it is hard to implement correctly
Attempt to do SOA "on the cheap“ - Middleware, governance tools, training, consulting, infrastructure and security are necessary
Fail to implement and adhere to SOA governance - The development effort will shift from building services to consuming services
Lack the required skills to deliver SOA - Specialized roles and skill sets are required
Let the vendors drive the architecture - Relying too much on vendors can be a disaster
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Typical Opportunities For Action
• Establish an active, substantive, senior-most executive-supported Community Of Practice (COP) from which SOA practitioners can build the necessary bridges across the organization
• Secure senior-most executive support / sponsorship for SOA
• Engage ‘the business’ and make sure they understand:– The potential for SOA but not ‘oversold’– The timeframe for SOA benefit realization (ensure expectations are
managed)
• Integration of SOA COP with the Corporate and CIO PMO / Portfolio Management function