If your organization is like nearly every other one I've talked to in the past 20+ years, you have a spaghetti chart of integration connections between all the siloed applications that run your business. Your customer is fractured across five applications. Your fulfillment process is broken across eight applications. Just try to pull together the data necessary to tell how profitable one of your products is. Or, as you implement mobile, external APIs, custom B2B connections, and more, how will you provide consistent, coherent access to your transactions and data?
Making sense of all the mess has been an important priority for years. The question is "how?" Forrester's latest research finds that it's time for a new kind of integration strategy. We call it "Digital Business Design":
A business-centered approach to solution architecture, implementation, and integration that brings business and technology design together by placing design priority on user roles, business transactions, processes, canonical information, events, and other business aspects that embody a complete definition of a business.
I attended the third annual Canonical Model Management Forum, May 14-15, 2012, hosted by DigitalML at the hip Washington Plaza Hotel again this year. I saw even more signs than last year that canonical models are key to API layers that many firms are building to promote integration. But first, let me share some data from Forrester’s last survey on canonical modeling adoption that I presented at the forum:
As our data shows, this practice is becoming increasingly widespread in firms publishing services that deliver information. Some of the trends I highlighted in last year’s forum post are even more evident this year, such as canonical models’ increasing use in data access layers, as I depicted with this slide:
Think of a medieval fortress: It was originally used for a small army, it has walls nine meters thick, and it’s surrounded by buildings hundreds of years old. Upon entering, you are confronted with the concept of eternity.
This fortress is located in the smallest state on earth — though it is also perhaps the best-known state in the world. The business housed within the fortress is what many might classify as a SME but with with complexity of a large enterprise, holy but busy, centralized but truly global — its work spans hundreds of countries with hundreds of currencies and hundreds of languages — and it serves very special and demanding clients.
Have a clue yet of where we are?
Zoom on Italy, then zoom on Rome, then zoom on Vatican City, and you can’t miss the round tower (Torrione Sisto V) where the Vatican Bank, or Istituto per le Opere di Religione (IOR ), is located. You won’t be allowed in if you are not a client, an employee, or part of a religious congregation. Change comes hard to institutions this steeped in tradition. To give you a clue, IOR’s previous managing director spent his entire career at IOR — 60 years — and retired at the age of 80. We all know it’s the soft and cultural aspects of transformation that are the hardest part for any organization.
Nevertheless, IOR has been going through a major change since 2008, working to replace its legacy IT system with a modern BT one. The new BT system brings more flexibility for the business, richer business functionality, and greater integration and development capabilities. Enabling fast change is the key driver for IOR’s IT transformation program from IT into BT.
I recently attended the second annual “Canonical Model Management Forum” at the Washington Plaza Hotel in Washington, DC (see here for my post about last year’s, first meeting, including Forrester’s definition of canonical modeling). Enterprise or information architects from a number of government agencies as well as several of the major banks, insurance companies, retailers, credit-card operators, and other private-sector firms attended the meeting. There was one vendor sponsor (DigitalML, the vendor of IgniteXML). There were a number of presentations by the attendees about their environments, what had motivated them to establish a canonical model, how that work had turned out, and the important lessons learned.
Last year I also had some recent Forrester survey results to share – we have not yet rerun that survey, but we are on the verge of rerunning it, so I’ll post some key results from that once the data is available.
Last year’s post is still the place to go to get the general overview about why to do canonical modeling, the main use cases, some areas of controversy (still raging), and a list of best practices I heard attendees agree upon.
What’s New In 2011?
Based both on what I heard at this meeting and on other recent interviews:
Forrester’s Forrsights Software Survey, Q4 2010 has quantified for the first time how enterprise demand is shifting from traditional licensing models to subscriptions and other licensing models, such as financing and license leasing. However, the shift to subscriptions for business-applications-as-a-service is the major driver of this change. Traditional enterprise licenses are slowly decreasing, and Forrester predicts that subscriptions for SaaS applications will drive alternative license spending up to 29% — as early as 2011. This demand-side change goes beyond front-office applications like CRM. In 2011 and 2012, enterprises will opt for “as-a-service” subscriptions for more back-office applications, such as ERP, instead of licensed and on-premise installations. Detailed data cuts by company size and region are available to clients from our Forrsights service.
Base: 622 (2007), 1,026 (2008), 537 (2009), and 930 (2010) software decision-makers predicting license spending for the coming year Source: Enterprise And SMB Software Survey, North America And Europe, Q3 2007; Enterprise And SMB Software Survey, North America And Europe, Q4 2008; Enterprise And SMB Software Survey, North America And Europe, Q4 2009; Forrsights Software Survey, Q4 2010
What does this means for existing independent software vendors (ISVs) and infrastructure vendors?
Can you remember a year when your business both (1) grew in a healthy way and (2) changed more slowly than the year before? Besides a company’s early startup years, such would be the exception, not the rule. So, in 2011, your business is likely to continue accelerating its pace of change. A recent Forrester report, The Top 15 Technology Trends EA Should Watch: 2011 To 2013, named both business rules and SOA policy as items for your watch list — because both of them help accelerate business change.
Back in the mainframe days — and even into minicomputer, client/server, and Web applications — nearly all of the business logic for every application was tightly wrapped up in the application code. A few forward-thinking programmers might have built separate parameter files with a small bit of business-oriented application configuration, but that was about it. But, business changes too quickly to have all of the rules locked up in the code.
Some have tried the route that businesspeople ought to do their own programming — and many vendor tools through the years have tried creatively (though unsuccessfully) to make development simple enough for that. But, business is too complex for businesspeople to do all of their own programming.
Enter business rules, SOA policy, and other ways to pull certain bits of business logic out of being buried in the code. What makes these types of approaches valuable is that they are targeted, contained, and can have appropriate life cycles built around them to allow businesspeople to change what they are qualified to change, authorized to change, and have been approved to change.
Software AG announced today a significant change in their executive structure. After the acquisition of webMethods back in 2007, the second largest software vendor in Germany acquired IDS Scheer last year, at topic we explored already in this report.
If you follow Software AG over this time, you might realize that the way CEO Karl-Heinz Streibich runs a post merger process may involve dramatic disruptions in the executive structure of the company. Dave Mitchell, the former webMethods CEO left some months after that acquisition. Today, the Chief Product Officer, Dr. Peter Kürpick surprisingly left the company. Peter was a member of the executive board since 2005, and, although his contract officially runs until 2013, he is leaving at his own request immediately. He stood for the successful turnaround of Software AG’s product strategy and repositioned Software AG from an outmoded mainframe shop into a leading global integration player. The successful merging of Software AG’s mainframe and integration know-how with the newer webMethods product stack into one interoperable integration stack was one of Peter’s major achievements. Peter also took over the responsibility for Software AG’s ETS (mainframe) product strategy after the integration business reached a solid stability. He would have had the skills and experience to create a consistent technology stack spanning from the mainframe over the WebMethods integration up to the business architecture tools of IDS Scheer (ARIS).
I'll soon have a client report out with interesting Forrester data about how SOA adoption continued apace during the Great Recession. In the meantime, Forrester partnered with TechTarget on a different SOA survey, primarily to TechTarget's readers, wherein we asked a wider range of SOA questions. The bottom line of all this data is that SOA is alive and well.
SOA's strong health is not a surprise (at least not to Forrester), but something else very interesting came out of the survey. To the question, "What is the most significant challenge you are facing with your SOA project/initiative?" the top response was not really about SOA. Instead, by a 2:1 margin over the next response, the biggest challenge was, "Designing how to do SOA in an integrated way with other initiatives (e.g., BPM, events, BI, rules, etc.)." (I describe this in more detail in a write-up over at SearchSOA.com -- you have to register to read the full article.)
In other words, people are realizing that, in a multi-technology world, siloed approaches to individual technology areas won't cut it. This is the fundamental insight driving Forrester's development of Digital Business Architecture (see Forrester report) and Business Capability Architecture (go to blog post or to another blog post).