Maximizing Web Services Project ROI

Over the past several years, the emergence of Web services has become one of the most talked-about advances in the technology industry. Throughout corporate IT, there is growing interest – and a bit of skepticism – about the promise and potential of Web services for corporate computing: "Will Web services change the way I do business?" "How can I realize and maximize Web Services ROI?" "Is anyone really doing Web services?" And even, "We hear Web services is the holy grail of computing."

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Indeed, Web services do represent tremendous business opportunity. As leading companies begin to develop and use service-based applications and development tools, application development costs are dramatically reduced and business agility is accelerated – together with the alignment of IT and business goals. However, while the development costs are often planned and understood, little attention is paid to the cost of service infrastructure, service management and service maintenance.

Without taking these additional costs into account, project ROIs can be greatly overstated and miscalculated. In fact, the cost of management can easily dwarf the cost of development, which can lead to insufficient funds for project completion. Fortunately, products such as Actional SOAPstation can dramatically and predictably lower these costs and allow the organizations to fully reap the benefits that Web services can deliver.

Anatomy of a Web Services Project

To illustrate the critical need for Web services management, and to illustrate its value, let's take a look at a typical Web service project.

General Products is a Fortune 1000 multi-division durable goods manufacturer. The Vice President of Customer Operations has recognized for quite a while that his customer service operation is fundamentally inefficient due to the lack of integration of corporate and inter-divisional information. In fact, to enter an order for a customer, the customer service rep must go through four distinct processes, each of which is tied to a different application system:

  • Gather customer information from the Siebel system
  • Check credit status and terms in a mainframe application
  • Check inventory availability in each division's SAP implementation
  • OK the order in the Siebel system

This process is complex, time consuming, and actually requires the service rep to hand write information or get a fax from the customer, process that information and then call the customer back.

General Products has assigned an IT team to solve this problem, with the goal of building an application that can complete this process in a single step, leveraging the existing applications. They have chosen to use Web services to attack this problem and decide to create two services: Enter Order and Inventory Check.

Using one of many popular products such as Microsoft.NET or BEA Weblogic Workshop, the development team implements this plan, first reaching back into their applications for the business logic and data from which they create these new services. The services are then integrated into an existing customer service portal that can natively consume them. Once implemented, these services will allow for greater throughput of orders and improved customer service, enabling them to reduce the headcount required to process orders while improving customer service.

Maximizing Web Services ROI: New integrated services reduce headcount required to process orders while improving customer service, thus improving return on investment

Maximizing Web Services ROI: New integrated services reduce headcount required to process orders while improving customer service, thus improving return on investment

Because Enter Order and Inventory Check are now Web services, General Products can reuse these services to drive incremental business benefits. General Products now leverages the Enter Order service in new and exciting ways such as allowing key customers to directly enter orders via a self-service portal. They can also make these services available programmatically to their affiliate resellers and outsource warehouse providers.

Seeing the success of this service-oriented approach, the team creates an Available-to-Promise service, building on the other available services. Another development team creates a Custom Quote service. With this explosion of services and consumers, the simple project has now blossomed into a complex yet valuable set of business interactions.

ROI: The Rest of the Story

If the story ended here, Web services would represent the ultimate free lunch, a perpetual motion machine of business benefits. However, it is not that simple. In reality, while attempting to scale and operate the project described above, General Products will face a growing set of daunting challenges. Without proactively addressing these Web services challenges, the General Products project is doomed to fail. Read the rest of this white paper to understand the full ROI picture:

For More Information

To learn more about how to maximize Web services ROI in your enterprise, download the entire white paper, Web Services ROI: Maximizing Returns on Web Services Projects