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An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
An approach to extract the business value from soa services
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An approach to extract the business value from soa services

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Natalia Kryvinska

Natalia Kryvinska

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  • 1. Natalia Kryvinska, Lukas Auer, Christine Strauss© 2011 IESS-1.1 University of Vienna
  • 2. Content© 2011 IESS-1.1 University of Vienna
  • 3. Introduction   Many enterprises have been long time struggling with the complexities and duplication inherent in countless redundant systems across multiple business units.   Thus, a single instance of a service, e.g., centrally developed, maintained, tested, and could be shared across an unlimited number of business units is a highly desired.   This is also the core of SOA’s value proposition, with services needed to be developed once only, and then made available to the rest of the enterprise through a registry.   Moreover, with web-based services it is necessary to implement an API in one place only.   The developers can build a series of components around a web-service that the enterprise applications can further use.© 2011 IESS-1.1 University of Vienna
  • 4. Benefits from Components Reuse in SOA Number of Services/Projects© 2011 IESS-1.1 University of Vienna
  • 5. Increase of SOA Business Value with Number of Projects© 2011 IESS-1.1 University of Vienna
  • 6. SOA “Business Value” Features Tree Reduced Operational Risk Reduced Flexibility value processing time drivers Profitability value Reduced drivers Improved errors Protect Ability to existing Change Reduced revenue system Enable new downtime Generate product new revenue development Increase Revenue Increase Increased Improved Ease of existing Profitability flexibility integration revenue Decrease Costs Reduced Reduced Reduced time-to- integration integration market time cost Reduced Increased maintenance reuse cost Improved ability for compliance© 2011 IESS-1.1 University of Vienna
  • 7. © 2011 IESS-1.1 University of Vienna
  • 8.   Today’s businesses depend on electronic processes at every level.   An organization’s ability to stay competitive relies heavily on being able to adapt its electronic processes fast - to improve productivity, reduce costs, deliver higher- quality information, and accelerate routine tasks.   For these enterprise needs, SOA offers protocol independence, meaning that different consumers of computing services - such as:   an application,   a server system, or   a human end user   can communicate with the same service in a different way to obtain the data or functionality desired.© 2011 IESS-1.1 University of Vienna
  • 9. Reference architecture© 2011 IESS-1.1 University of Vienna
  • 10. © 2011 IESS-1.1 University of Vienna
  • 11.   From an organizational perspective, it is difficult to place a concrete value on many decisions, actions, or investments because the effects are too distributed or too moderated by other factors to measure them easily or accurately.   Thus, arises a question - what does it make measuring SOA strategic value so difficult?   A simple answer is that there are too many ways to measure it.   Every consultant, practitioner, or faculty member has a unique method for capturing SOA value.© 2011 IESS-1.1 University of Vienna
  • 12. Methods for Valuing IT/SOA Investments Accounting rate of return Critical success factors Quality engineering Activity-based costing Customer resource life-cycle Real-options valuation Analytic hierarchy process Decision analysis Return on management Application benchmark Delphi evidence Requirements costing techniques techniques Application transfer team Executive planning for data processing Schumann’s method Accounting rate of return Critical success factors Quality engineering Activity-based costing Customer resource life-cycle Real-options valuation Analytic hierarchy process Decision analysis Return on management Application benchmark Delphi evidence Requirements costing techniques techniques Application transfer team Executive planning for data processing Schumann’s method Benefits-risks portfolio Investments portfolio Socio-technical project selection Benefits assessment grid Information systems investment strategies System dynamics analysis Knowledge-based systems for Break-even analysis Systems measurement information systems evaluation Management Information Systems (MIS) Boundary value Time-savings-times-salary utilization technique Costs-benefits analysis Multi-objective, multi-criteria methods User utility function assessment Costs displacement/avoidance Options theory Value analysis Costs-effectiveness analysis Potential problems analysis Value chain analysis Costs-value techniques Profitability index Ward’s portfolio analysis Costs-revenue analysis Process quality management Wissema’s method© 2011 IESS-1.1 University of Vienna
  • 13. © 2011 IESS-1.1 University of Vienna
  • 14. Components of SOA “Business Value” Costs Organiza- Business Integ- tional Process ration Techno- Servicifi- Human logy cation Recources SOA Business Value Benefits Services/ Architec- Integra- Recources ture tion Re-use Flexibility Human Open Recources Standards© 2011 IESS-1.1 University of Vienna
  • 15. © 2011 IESS-1.1 University of Vienna
  • 16.   Risk factors that can impact investment decision process:   Organizational factors - complex program networks, misalignment of (or conflicting) internal goals, lack of leadership support;   Business process factors - impact on existing process, fear of changing work assignments;   Technology factors - rapid changes in technology, interacting with parallel systems, scale and complexity.   Furthermore, project failures are the result of the multiplicity of risks inherent in software project environment.© 2011 IESS-1.1 University of Vienna
  • 17. Risk Analysis Example© 2011 IESS-1.1 University of Vienna
  • 18. © 2011 IESS-1.1 University of Vienna
  • 19. Breakeven Total revenues line Point Total Revenue/Costs Total costs line Operating income Operating loss Number of Services© 2011 IESS-1.1 University of Vienna
  • 20. © 2011 IESS-1.1 University of Vienna
  • 21. Service Development Costs Traditional Approach Economic Advantages SOA Approach Fixed Cost New business capabilities SOA become economically feasible Break-even Point Number of Services© 2011 IESS-1.1 University of Vienna
  • 22. where: π - profits, p – price, q – quantity, c = unit cost (average variable cost), f - fixed costs.© 2011 IESS-1.1 University of Vienna
  • 23. Conclusions   In order to maximize the intended benefits of SOA implementation, organizations need to develop a well-articulated SOA quality strategy to promote trust and reuse.   However, building an effective SOA platform requires tight integration between new and existing product categories, and it may require large investments.   For this reason, conventional investment valuation methods need to be combined with other modern techniques to reflect SOA’s long-term strategic investment nature.   Thus, in this paper, we apply modified BEP method developed under the BVA umbrella for the evaluation of SOA projects, in particular for the services reuse related.© 2011 IESS-1.1 University of Vienna
  • 24. natalia.kryvinska@univie.ac.at© 2011 IESS-1.1 University of Vienna

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