Ask a technologist to define service-oriented architecture (SOA) and chances are you'll receive a variety of definitions. SOA has been bandied about to describe everything from Web interfaces to distributed systems. At its most basic, SOA enables applications and services to communicate with each other.
For insurers, SOA typically takes the form of a subordinate architecture of Web interfaces that communicate with legacy systems - think of claims data being pushed out to an insurer's Web portal. Steve Scott, vice president of information technology for Vision Service Plan (VSP), however, insists on a more rigorous definition. For Rancho Cordova, Calif.-based VSP, SOA is an enterprisewide architecture that will enable the insurer to quickly implement new technologies, offer new products and services, and react to new market conditions.
Prior to making the decision to implement SOA, a large group of VSP ($2.06 billion in revenue in 2004) managers and executives described their business priorities to the organization's IT department. At the top of the list was flexibility and agility to meet changing business conditions. IT then reviewed technology architectures to understand which technologies would enable VSP to meet those priorities.
VSP briefly considered approaches such as straight distributed architectures, but it became clear very quickly in the review process that SOA would provide the flexibility the insurer was after, relates Kyle Kelt, director of IT architecture at VSP. Plus, VSP technologists already had experience in Java, and SOA would enable VSP to leverage their knowledge. Professional services firm Primitive Logic (San Francisco) then was engaged to help VSP implement SOA and understand how it would change the company's architecture.
Because the project is measured in years, not in months, engaging VSP's business leaders was critical, Kelt notes. One of the virtues needed to manage a project of this magnitude is patience, he explains. "It takes a long time to make major changes to an architecture," Kelt says. "It takes a lot of patience from the organization's leadership to do it properly and understand that it's a long-term goal that you need to stick to so that you will reap benefits at the end."
Kelt points to the process of identifying VSP's business priorities as an example. The discussion is ongoing, he says, adding that three years into the project the carrier still evaluates priorities against the plan and makes adjustments as needed.
According to Kelt, the main benefit VSP will enjoy from SOA will be enhanced flexibility. "We are spending our energy to build flexibility into our systems so we can make systems changes as the business changes," he says. "It's pretty hard to predict what changes will occur in the business five years from now, so it's important to make your systems flexible enough to deal with whatever the changes may be."
SOA will enable the IT staff to streamline core business processes with a lot less effort than was required in the legacy environment, Kelt relates. It also will enable the organization to get new products to market faster, and push information out to its sales channels about new products and services quickly, he adds.
Although VSP expects the completed architecture project to pay for itself by reducing the costs of making technology changes, SOA is not about cost savings, points out Scott. "SOA is about positioning VSP to take better advantage of the capabilities of technology to go to that next step and deliver superior products and services," he says.
The inherent flexibility of the SOA architecture plays nicely into VSP's mission statement for the IT department, which is centered on creating business solutions through productive partnerships. "I want IT professionals to think of themselves as being businesspeople who know a lot about technology rather than being technology people who know a little bit about the business," says Scott.