All the major IT companies have agreed to the common set of standards that underpin Web services. These companies are also investing millions in their Web services offerings. So the technology is not a flash in the pan - it is here to stay. The beauty of Web services lies in their ability to transfer information seamlessly between applications. Sectors heavily reliant on the flow of information will be first to take advantage of the technology. Companies in the US and Europe are currently neck-and-neck in Web services deployment and pioneers are to be found in both countries. For example, in the UK, Tesco is using the technology to link its customer-facing online ordering system into its partners' systems. This allows the company to use its Web site to sell a wide range of products supplied by third parties without the need for re-keying of orders. Since Web services run over the Internet, they can be "rented" from anywhere in the world. This means that software will soon be sold as a service rather than as a product, radically changing suppliers' business models. This will occur because suppliers are putting themselves in the position of being held to account: they are offering not just "out-of-the-box" software packages, but hosted business processes that form an integral part of their clients' business infrastructures. Just as Web sites have become a universal format for publishing and retrieving information, Web services will become the universal format for providing and using applications. Web services make it easier to connect processes between organisations, so they will inevitably encourage more extensive sharing of information between firms. For example, a Web services-enabled customer relationship management system could be shared between a retailer and its suppliers. This would necessitate water-tight encryption and data security systems, processes and policies between the retailer, its suppliers and its Web services provider. Web services will lead to greater connectivity within businesses, across supply chains and with customers. As more functions are carried out online, users will be increasingly hungry for bandwidth. This will also occur because Web services make it easier to share information within and between businesses. This will happen for two reasons. First, more applications and business processes will become available for "rent" remotely as Web services provided by third parties. Second, Web services will increase the number of business processes that transcend traditional organisational boundaries - say, between suppliers, manufacturers and distributors. The combined result of these two trends will be a gradual transformation in traditional organisational structures.
In the last in a series of three articles on Web services, Atos KPMG Consulting's Andy Tinlin offers 10 predictions for the future.
The standards underpinning Web services will hold up.
The financial services, travel, energy and public sectors will be among the first to embrace Web services.
The US will not take its traditional lead over Europe when it comes to Web services innovation.
Web services will dramatically change the software market.
There will be a shift in the balance of power between technology suppliers and their customers, in favour of the users.
Web services will become the basic building block of technology and business infrastructures.
Security issues - particularly personal privacy, authentication and data ownership - will rise up the corporate agenda.
Web services will boost broadband adoption.
We will see a growing demand for improved knowledge management, data storage and data retrieval systems.
As Web services mature, they will bring new organisational models, including the much-discussed "virtual organisation".
Andy Tinlin is managing director at Atos KPMG Consulting.
Real World is a regular column in which IT and management consultancy Atos KPMG Consulting shows how the innovative use of technology is helping companies to gain competitive advantage and address critical business issues.
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