How Web Services Can Help Create New Organizational Efficiencies

Note in the previous example how the bank was able to use Web services to create process flow efficiencies (usually translating into reduced sales, general, and administrative costs and greater organizational profitability).

Business process management enables enterprises to establish policies (for instance, who can use what applications under what conditions) and procedures (how applications are to interact) and to organize workflow (optimize the order in which applications are executed to eliminate redundancy and speed up processing). By properly designing the ebb-and-flow of business processes, a well-organized enterprise can create great efficiencies. In the preceding example, by using Web services this bank was able to quickly add new products to its portfolio (making the bank more competitive and increasing the chances for additional profit). And this bank has the opportunity to further streamline its operations by using business process management software to integrate its various Web services applications with its traditional core applications thus improving internal efficiency by breaking down internal organizational barriers while also improving the customer experience.

What is missing from the banking example is consideration of business process flow. To make the most efficient use of its new Web services-based applications, the bank must also find a way to improve the process flow of information within the bank and to its customers.

For instance, it would be great for a bank to help a customer ascertain whether he or she was qualified for a mortgage, but shouldn't the bank at the same time be able to present that customer with information about the bank's current loan rates and terms? And shouldn't the bank make it easy for the customer to "sign on the dotted-line" for that mortgage immediately? And, if the customer signs up, shouldn't other bank systems be made aware that he or she has become a mortgage customer and could also be a prospect for financial planning or life insurance services?

To make this happen, the new Web services applications would need to be integrated with other traditional banking applications as well as with the bank's workflow processes. The bank would than have access to new business opportunities as well as experience new efficiencies (because various applications would be working together to solve customer problems rather than working across departmental or organizational business unit lines). The resulting opportunities to garner new sources of revenue combined with cross-organizational efficiency would be passed directly to the bank's bottom line in terms of reduced sales/general/administrative (SG&A) costs.

At present there are no formal standards for business rules and business process management. Instead, builders of Web services need to augment their Web services architecture with a "rules engine" or business process management software that deals with how to optimize workflow and processes. For IT and business managers there are dozens of rules engines, workflow products, and business process management software packages on the market today from which to choose. And several vendors are working to closely integrate their business process management tools with their respective Web services offerings.

Some Web services product suites that include tools to simplify application development and automate business process flow are offered by:

• BEA (with its WebLogic servers);

• IBM (with its WebSphere Personalization Server and/or related business-rule "beans");

• Microsoft (with its BizTalk software environment); and

• Hewlett-Packard, Oracle, and others.

These suppliers and their product lines are covered in greater depth in the comparative/competitive section later in this book. Note that all of these products have extensions (software not directly related to Web services standards) enabling enterprises to establish policies and procedures that allow for efficient process and workflow between Web-based applications.