David Senf and Warren Shiau IDC Canada October 9, 2003 416.673.2271

1. The IT Legacy, Web Services, and Your Business Processes David Senf and Warren ShiauIDC CanadaOctober 9, 2003416.673.2271 Note: May not be reproduced or used in part or whole without permission from IDC Canada

2. Agenda • Continuous IT innovation… • What’s the problem? • IT complexity and business processes • The IT imperative • How does Web services help? • What, why, when, where? • Managing IDs in a Web services context • What can be gained? • Standards evolution • When is it time to start?

3. Complexity Fragmentation • Individual systems • Technology solution • Vertical integration • Granular apps to solve business process problems • Process solution • Alliances, camps and coalitions • Software suites • Business solution • Bi-polar approach Software Revenues and Computing Eras Log Worldwide Software Revenues ($) Global Software Market 2.6 2.4 2.2 2.0 1.8 1.6 1.4 1.2 1.0 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: IDC Beacon III Software Forecastertm

4. WWW Continuous IT Innovation: What’s the Problem? Physical Fragmentation by Platform IMS VSAM DB2 IDMS S390 VM Oracle Unix Novell RDB VMS Ingres Linux Mac SQL Server WNT W2K OS/2 Browser

5. Continuous IT Innovation: What’s the Problem? Logical Fragmentation by System

6. Agenda • Continuous IT innovation… • What’s the problem? • IT complexity and business processes • The IT imperative • How does Web services help? • What, why, when, where? • Managing IDs in a Web services context • What can be gained? • Standards evolution • When is it time to start?

7. IT Complexity and Business Processes • A Process* is: • A series of actions, changes, or functions that bring about a result • A series of operations performed in the making or treatment of a product • What is Business Process Management (BPM)? • Called process change, process execution, process evolution, business process – BPM involves the human element of understanding the processes around business. • Some popular process methodologies: Reengineering, Knowledge Management, Supply Chain Management, Value Chains, Six Sigma…among others * Source: American Heritage Dictionary.

8. IT Complexity and Business Processes:Technology Solutions Around BPM • IT has offered many technology solutions to the human challenge of business process management • Business Process Automation, Business Process Management, Business Process Modeling • Challenge • How to provide the changeable human element into technology • In the past, software code was difficult to change in response to process • New efforts with Web services languages, of which there are many, seek to lessen the difficulty of changing process rules without cutting new software code

9. IT Complexity and Business Processes • Standards created (BPML/BPMS) as the next step in the management of business processes, working to bridge the gap between technology and the business process • Many languages and systems are being introduced that may fulfill similar functions as the BPML/BPMS Theoretically FRAGMENTATION Time Source: CSC and IDC 2003

10. IT Complexity and Business Processes: Integration and Consolidation • To address fragmentation… • Point-to-Point Integration • Legacy of historical integration models • Heavily project-driven • Enterprise Integration • Currently dominated by EAI and integration broker • Application Integration • Data, Interface, AND Process integration • Additive, NOT exclusive • Total platform as infrastructure

11. IT Complexity and Business Processes: Integration and Consolidation - The Business Context • Technically Speaking ... • The goal of integration is to achieve the unification of two or more applications, data sets, or interfaces by connecting elements that were not originally designed to inter-operate. • But From a Business Standpoint it Needs to Do More... • The goal of application and enterprise integration is to conduct business in an flexible, timely and intelligent manner. • The drive to automate for quality, competitiveness, and/or profitability • Beyond connectivity

12. IT Complexity and Business Processes: Integration and Consolidation – Key Components of the Business Vision • Ensuring that each contact is greeted with appropriate information… • Rich CRM system, linked with call centres, web site logins, etc. • Real-time information exchange with the field • CRM; secure wireless infrastructure; procedural information repositories; effective integration with financial systems, MRP/inventory information… • Linking to third party business partners • Participation in/management of extranets; effective use of web services and data interchange technologies such as XML and WS/XML extensions • Capitalizing on the data • BI systems linked seamlessly/automatically to internal and external information sources (again, requires WS/XML technology) • Seamless integration of new business lines • Robust and standard core technology and IT processes, data definitions, etc. • Cost-effective operations • Efficient use of capital resources; effective management/reduction of maintenance costs

13. IT Complexity and Business Processes: Integration and Consolidation – The Internal Sell • Standardization – reduce management complexity (and cost) in the IT environment by deploying interoperable, uniform technologies at the client and server levels • Manageability – reduce the costs associated with… • Managing disparate systems through standardization and consolidation • Maintaining links between applications • Consolidation – aggregate resources into a consistent, manageable architectural framework • Utility – develop the ability to deploy resources flexibly, across consolidated platform resources

14. Agenda • Continuous IT innovation… • What’s the problem? • IT complexity and business processes • The IT imperative • How does Web services help? • What, why, when, where? • Managing IDs in a Web services context • What can be gained? • Standards evolution • When is it time to start?

15. The CIO’s Delicate Balance System Priorities • Development/deployment of new systems • Maintenance/enhancement of existing systems Investment Priorities • Addressing LOB requirements for business support • Creating a robust and flexible infrastructure Timing Priorities • Delivering incremental, tangible near-term benefit • Staying focused on long-term system benefit

16. Secure Adaptable “Plug & Play” Customers Employees People Process Business IT Technology Financial Partners/Suppliers LOBs Agility Flexibility Leveragability Services-Oriented Impact

17. Business Process Efficiencies Top Business Rationale N=200; D01A. Which of the following do you see as business advantages to using Web Services? Source: IDC Canada, 2002

18. Augmenting Current Technology Top Tech Rationale N=200; D01B. Which of the following do you see as a technical advantage to using Web Services? Source: IDC Canada, 2002

19. Agenda • Continuous IT innovation… • What’s the problem? • IT complexity and business processes • The IT imperative • How does Web services help? • What, why, when, where? • Managing IDs in a Web services context • What can be gained? • Standards evolution • When is it time to start?

20. Organization A Organization B Metadirectory Metadirectory LDAP/XML LDAP/XML Legacy Directories RACF, NDS, ACF2… Legacy Directories RACF, NDS, ACF2… SOAP WS-SecurityLiberty Alliance SAML Attributes/Assertions Authentication Authorization/Policies Privacy Preferences Standardized Identity Federation Internet

21. Organization A Organization B Metadirectory Metadirectory LDAP/XML LDAP/XML Legacy Directories RACF, NDS, ACF2… Legacy Directories RACF, NDS, ACF2… SOAP WS-SecurityLiberty Alliance SAML Attributes/Assertions Authentication Authorization/Policies Privacy Preferences Standardized Identity Federation ROI Reduced complexityLeverage IT investmentsReduced churn costReduced helpdesk costSeamless accessPersonalizationScalable/flexibleHigher security/privacy Drivers Process integrationPortalsB2B eCommerceWeb servicesComplianceMobilityM&A Internet

22. Agenda • Continuous IT innovation… • What’s the problem? • IT complexity and business processes • The IT imperative • How does Web services help? • What, why, when, where? • Managing IDs in a Web services context • What can be gained? • Standards evolution • When is it time to start?

23. Web Services Standards/Specifications Function: Can’t plan in isolation: Process, Management, Transactions BPEL4WS, BPML, Tentative Hold Protocol, WS-Transaction, WS-Coordination Internet XML Digital Signature, XML EncryptionW3C, SAML, WS-Security Oasis, WS-Trust, WS-Federation, Liberty ebXML, WS- Reliable Messaging Oasis, HTTP-R, WS-Reliability Quality of Service Extranet Description, Discovery, Publication WSDL W3C, UDDI OASIS, WS-Addressing, WS-Policy, WS-Inspection Other services and protocols SOAP,W3C Intranet Messaging XMLW3C Transport TCP/IP, HTTP, etc. … IETF Source: Who’s Behind the Standards Behind Web Services? (IDC #28563, December 2002)