Waves of change

Web services promise to be the technological equivalent of being in the right place at the right time with just the right information at your fingertips. And some say the technology will hit the IT world like a tidal wave.

“Web services is a tsunami of technology evolution,” Andre Mendes, chief technology integration officer at Public Broadcasting Service in the US, said. He said the nonprofit organisation uses Web services to connect upstream with content developers and producers and downstream with public TV stations and viewers. “What we’re developing is a supply chain optimisation that puts us right in the middle of this equation,” Mendes said.

Government, which is generally a late adopter of new technologies, is leading the uptake of Web services in Australia, according to Graeme Turner, technical director of Siebel Systems Asia Pacific.

The imperative to share information and processes is a key driver for government uptake. “Also, in government, there are some things being done, like the Victorian government CIO appointment, like NOIE in Canberra, where there are some overriding bodies that can control standards. When departments need to share data, Web services gives them a common language and lets them divorce themselves from underlying technologies; in other words when one department has a Microsoft strategy and another has a J2EE strategy.”

In the private sector, however, while it is starting to pick up, Web services is still seen as a lagging technology. “A lot of commercial organisations are focusing on internal integration — for example, talking to mainframes; it is not that easy with Web services at this point in time and there are other technologies that are more readily adopted there.”

For the private sector, he said, the most useful aspect of Web services is that it lets companies, or divisions within companies, move away from the technology war. “There’s no clear winner in the Microsoft .Net, Java type of war and I don’t think there will be. Web services is like a demilitarised zone.”

For the private sector, Turner said, the perception seems to be that Web services is still not a proven technology; there are still some gaps to be filled as far as customers are concerned.

He said customers are asking about Web services and how and where it can be used in their business. In some instances, customers will implement it within a new project as a trial and, while they agree that it works, for many of them the jury is still out.

Turner believes the maturity of Web services will see even more uptake in the private sector. The benefits seen in government for information sharing between departments, such as in a case between the Victoria Police and the Australian Tax Office which made joint case management possible, has implications for the private sector.


Kevin Francis, technology director at Expert Information Services, says it’s a fascinating time in the industry because it’s the first time that everything just talks to everything. “There’ve been enormous struggles in the past because of applications that won’t talk to each other — a great chasm between applications and it’s now about building bridges between them.”

However, he readily agrees that to many companies Web services is a “scary new technology”.

But customers are asking about Web services and the three types of things we’re doing with Web services for both new and existing customers are app-to-app integration — even across platforms, and that’s one of the real strengths of Web services; we’re doing the early days of B2B stuff, the takeup of that is a bit slower. The technology is just now maturing to the point where that is really viable. The other one is using Web services as a user interface mechanism. — tying user interfaces of applications to the middle tier using Web services — instead of the older style, client/server technology.We’re also using it for building better user interfaces than we’ve been able to in the past.”

For in-house users, he said, it is a significant advantage. “There’s the opportunity to build much better user interfaces than has been the case in the past so even getting down to — Gee we can build Windows-based user interfaces as opposed to browser-based ones, that are able to communicate over HTTP efficiently and effectively. And that’s a huge advantage for the end user.”

“Customers can take up Web services safely and get their feet wet in a way that will let them grow over time. Web services is a new technology, one that a lot of companies are loooking at with a degree of scepticism, because it’s new. “We’re saying it’s great and it does work but like anything, if you’re not careful about how you design your first one, how you select your first application to build using Web services, you can build something that will not scale and will not grow, maybe won’t be secure.

“Start small but you won’t need to throw it away when you go to the next step.”

Over the next several years, Web services are likely to enable companies to get a lot more out of technologies such as supply chain systems and CRM, and they’re likely to make it easier to build new applications and integrate existing ones. Here are some snapshots of how Web services are expected to change key parts of the corporate IT agenda:

Business intelligence and CRM

Most of the major business intelligence and CRM vendors plan to support Web services in their products or are already doing so, and Web services are expected to make those applications more readily available to internal users and external business partners.

Web services — with their standardised application programming interfaces — will allow analytical tools to be more easily embedded in standard applications, says Michael Corcoran, chief communications officer at Information Builders. The latest release of the company’s business intelligence product supports Web services, allowing reports to be created and published as a Web service accessible from Java 2 Enterprise Edition or Microsoft’s .Net environment. “Web services will make business intelligence components usable with many other applications,” such as call centre or Web customer service applications, Corcoran says.

Just imagine the systems that could be improved with real-time transactional data delivered by Web services. For example, a manufacturer could use a business-intelligence system to forecast demand for raw materials and then employ Web services to relay the data to numerous suppliers producing those materials. An insurance company could more easily and quickly send CRM information — such as a customer’s previous complaint about a policy — to a call centre agent to help provide better service.

“The point of Web services is to make it easier for people to construct and integrate applications,” says Henry Morris, an analyst at market research firm IDC. “Web services, combined with standards like XML, will make it easier for people to tie business intelligence and CRM applications together. That’s where you get the real value out of business intelligence; not just getting a report, but being able to act on it and get feedback.”

Joe Wanzek, vice president of IT at a large insurance outfit, says his company already has an in-house CRM application that provides transaction information to customer service representatives. But with Web services, Wanzek expects to be able to deliver that data via the Internet to customers just as quickly. That will eliminate the need for costly and time-consuming phone calls to work out customer complaints or answer queries, he says.

Supply chain systems

The adoption of Web services is expected to enhance the way businesses conduct transactions with one another electronically and the way information moves through the supply chain.

Mitsubishi Motors in the US uses Web services to link 700 dealers through its portal — a single point of entry for dealers online, says CIO Tony Romero. “Anything a dealer needs to do can be done through the portal, no phone calls necessary,” he says.

The key to easier integration is the fact that Web services are based on widely adopted standards such as XML. “It changes the integration game; it will be much easier to [link systems] because of the open standards,” says Toby Redshaw, corporate vice president of IT strategy, architecture and e-business at Motorola.

“When you map the supply chain today, starting with source material, all the way to product repair, you’ll find there are 10 to 12 disconnected processes with big gaps and integration issues,” such as how to handle product repairs and returns, Redshaw says. Web services will help trading partners fill those gaps by providing better communication among their supply chain applications, he adds.

In many cases, transactions among trading partners, such as ordering supplies, fulfilment, billing and inventory management, will be wholly automated, says Mike Gilpin, an analyst at Giga Information Group. For example, a retailer could develop a standardised, automated program for ordering goods and then use the program to allow its purchasing applications to work with suppliers’ inventory systems.

This will be a less complex and time-consuming endeavour than it would be without Web services. Automation will also help reduce costs, Gilpin says. “One of the impediments to B2B commerce has been cost, and I think costs will be reduced gradually by Web services,” he says.

Application development

In addition, Gilpin says, the combination of Web services and technologies such as radio frequency identification tags will enable companies to track the location of products in real time as they move through the supply chain, while gathering data about overall demand, purchasing trends and inventory.

Within three years, Redshaw predicts, intelligent Web services will emerge that completely automate a lot of supply chain management functions, such as handling customer queries from call centres or feeding customer-retention data to salespeople in real time.

Industry experts expect Web services to speed up and simplify application development, allowing IT departments to not only create new applications in less time, but also to deliver them to more internal and external users.

“You won’t see a whole new array of things that you couldn’t do before because of Web services, but you’ll see application development enabled much more quickly,” says Larry Calabro, a partner in the technology integration unit at Deloitte Consulting. Calabro says Web services standards will make it easier for companies to build applications that more effectively integrate existing software packages such as CRM and ERP. “The focus of application development will be to make all those assets work together to better meet business goals and better serve customers,” he says.

Web services will make it easier for less-skilled people to more rapidly build applications through their standardised application development tools, says Michael Blechar, an analyst at Gartner. “Web services standards like XML and UML are providing much more automation” in the process of developing and sharing applications, Blechar says.

The ability to recycle software code is another benefit, he says, pointing out that teams of developers will be able to reuse components and place them into applications, rather than having to rewrite existing code. “The whole philosophy of Web services is based on reuse,” Blechar says. “Clients, supply chain partners and people inside the organisation will be able to reuse components.”

Wanzek agrees. “As XML becomes more of a common tool,” he says, “it will allow us to provide quicker and more reusable application development.”

— with Ellen Fanning and Gabrielle Wheeler

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