In Touch With Retailing

Making the Business Case for SOA

By Al Pappa, Vice President, Business Architecture, Fujitsu Transaction Solutions Inc.

Although much has been written about Service-Oriented Architecture (SOA) – an approach to developing a standardized software interface so that one program can use the functions (services) of another – few retailers have begun to explore its business value on a wide scale.

To create a robust business case for SOA, it’s important to understand the full range of the SOA value proposition. The more mature and pervasive SOA becomes in an organization, the higher the benefits that can be derived and the lower the time and cost to implement the next SOA project.

Four key benefits drive the business value proposition from an SOA implementation: reduced integration expense; increased asset reuse; increased business agility and reduced business risk and exposure.

Reduced integration expense is driven by the ability to integrate historically separate systems; by mixing legacy and new applications, retailers can extend the life of their investments while facilitating the possibility of mergers and acquisitions.

Increased asset reuse comes from eliminating duplicate systems, skills and investments by designing applications and IT infrastructure that promote reuse. SOA enables retailers to adopt standards that enable interoperability, build system functionality once and reuse it by recasting software assets into consumable services.

Increased business agility means retailers shorten time to market for new initiatives designed to preempt competition, or react quicker to changing market forces. With an SOA strategy, retailers can provide personalized Web shopping experiences for customers and specialized Web portals for suppliers, employees and business partners that automate previously manual processes and transactions.

Reduced business risk and exposure are the result of improved visibility into business operations at a more granular level than is possible with manual processes. More intelligent tools such as data mining, pattern recognition and statistical methods help retailers detect theft and fraud and improve regulatory compliance related to Sarbanes-Oxley, for example.

In making the business case, retailers must also develop a detailed cost model for all relevant costs, including SOA architecture, design and planning; education and training to support SOA; hardware purchase and maintenance costs; and software licenses and maintenance.

With thorough due diligence and planning – including “what ifs” for the unknown – retailers can approach SOA with a robust, comprehensive, and credible business case that enables the retailer’s executive and financial management to make sound business decisions.