What Can Web Services Offer?

With Web services standards still emerging, the big question is just when its potential will be realized. But as the insurance industry waits, there's also room for dispute—especially from an insurance IT executive's perspective—on the range of benefits Web services may bring.

In a nutshell, Web services are applications that can act interact with others through XML-based messaging, such as SOAP (simple object access protocol), UDDI (universal description, discovery and integration), and WSDL (Web services description language). They enable parties to expose digital assets and for such "publicized" assets to be "interrogated" to determine whether they meet the requirements of a party who might wish to consume them. Such transactions can be used in a variety of ways, both within and external to an enterprise.

"I think Web services is being driven by a desire to do B2B e-commerce the way humans conduct business today," says Brian Wallace, director, e-commerce, CSC (Austin, TX). "In today's B2B world, if I want to get something from you, we have to have a lot of conversations." In the Web services model, however, a party seeking a service can approach a provider with no advance knowledge, since the standards serve to abstract those details away. "The e-commerce vision is to have this kind of dynamic marketplace where everyone is publishing these Web services, and I, as a consumer, can tap into these service and then create integrated systems," Wallace says. With that capability, a company can "insource and outsource any part of its business processing," Wallace adds.

An insurance example would be the ability of a third-party provider seeking to incorporate a online quoting capacity. "I may not have a rating or underwriting engine in my shop, but I can go out and invoke that service," Wallace says.

While acknowledging that Web services are not just around the corner, Josh Lee, global technical strategist, Insurance Enterprise and Partner Group, Microsoft (Redmond, WA) says, "the technology is maturing every day." In fact, Microsoft, which introduced the first Web-services development environment/platform—.Net—about a year and a half ago, at press time was about two weeks away from releasing development tools for production. In projecting the success of the technology, Lee emphasizes its analogy to prior models. "You could argue that Web services have been around for years, but only in proprietary formats," he says.

Lee acknowledges the obvious value of Web services on the B2B side, but also sees value in the potential of Web services as a systems integration tool. "Application integration is very important, especially in an industry such as insurance, which has a need to integrate different siloed business applications."

Don Lykins, CTO of Cincinnati-based e-solutions firm Portalsoft, sees Web services as the next step in the evolution of business process integration and sees the technology as potentially "the cornerstone of enterprise application integration EAI."

"Prior to the invention of Web services," Lykins says, "EAI was difficult because you ha multiple programming languages and middleware," resulting in many different systems and interfaces. Through the open standards of Web services, "you can now integrate multiple business departments, applications or processes very quickly and cost effectively," enabling rapid adaptation to a changing business environment, he adds. "It enables companies to centralize what makes sense and have an open, industry-standard way of enabling these services and processes."

Web Services To Replace EAI?

Such a vision is plausible, though premature, according to CSC's Wallace. "I don't think EAI and Web services are mutually exclusive, but EAI and the integration tools on the market today represent the state of the art," he says. "You might say that when the full Web services vision is realized, EAI will cease to exist." In the meantime, he adds, "I think they'll grow along side of each other."

One of the chief distinguishing features of Web services technology is its simplicity, according to Ken Barger, CTO, The Hartford—and it is just that which makes it a more viable proposition in the B2B world than within the enterprise. "Web services can be more pervasive because they're more simple," he says. "But Web services, by itself, is not going to replace some of the more complex messaging capabilities required within an enterprise for some time to come."

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio