Web services get real

Web services are a set of common IT standards wrapped around a business application that allow it to interact with any other...

Web services are a set of common IT standards wrapped around a business application that allow it to interact with any other similarly-wrapped product. And here is the best bit: rather than every supplier doing its own thing, a consensus is being reached on standards - despite recent spats between suppliers keen to maintain their competitive differentiation.

According to IT analyst Gartner, 95% of all major IT suppliers will have added Web services to their applications by 2004 - and they will all be talking the same language.

However, there is still work to be done before Web services can offer a completely robust, secure, and reliable environment. That said, the technology is already mature enough to support internal processes and it will not be long before external processes benefit to the same extent.

But Web services are not a silver bullet for all integration issues, nor a magic button that will automatically deliver increased agility. They allow applications and systems to talk to one another but, if the resulting content is not valuable, if effective change management programmes are not in place or without robust business process redesign, Web services implementations will struggle to repay their costs.

For businesses that do get these things right, the benefits could be substantial. The IT department, which currently spends about 65% of its time integrating applications, should find life getting easier - and the bill should get smaller too.

But Web services have still bigger business implications. Common standards will free organisations from supplier ties and reliance on one brand, giving them the flexibility to shop around in the IT marketplace, to select best value components and business applications, and to fit them together without heavy-duty bespoke integration.

And what works for internal business processes and systems can be applied externally too. Universal Web services' standards mean you can connect your business processes cost-effectively and securely with partners, suppliers and customers, more seamlessly than ever before. This opens up trading possibilities in areas where, previously, it may not have been cost-effective to do business.

The automation of internal processes (such as expenses) with external processes (such as company credit card transactions) can dramatically reduce administration costs and improve efficiency. For example, one European financial services business has recently used Web services to automate the collection of pension scheme data from 30 different payroll systems - formerly the job of 50 manual data collators.

Web services also make it easier for organisations to hire business processes from third parties in areas where outsourcing was not formerly viable. This is made possible by the common standards that allow individual business processes supplied by a third party to be incorporated into an existing infrastructure, and by the Internet protocols that enable Web services to be delivered remotely by a third party.

The current economic slowdown has prompted companies to focus IT investment on improving the inner workings of business. What better way to begin experimenting with Web services than in discrete e-business projects designed to do just that?

Web services are here to stay and are underpinned by a unique industry commitment to common standards. Businesses that experiment with Web services now will be primed to seize new market opportunities when the economic upturn comes.

Andy Tinlin is chief information officer at Atos KPMG Consulting.
This was last published in September 2002

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