SOA Adopters Discuss Best Practices
Central Governance Is Key
Another key to successful SOA implementation is governance. Specifically, organizational structures need to be in place to foster collaboration among business lines and movement beyond specific silos. Allstate, for instance, has a very federated development organization, according to the company's Abbattista, and the carrier's SOA development standards and architecture are centralized.
"The baseline is governance" when discussing SOA best practices, says TowerGroup's Gorman. "We're seeing things like enterprise steering committees, business architecture models, councils of architects, project management offices and certification of reusable services. Those are the guiding principles from a governance perspective."
MetLife's Kessler credits architecture reviews with helping maintain consistency in integration. He compares the process to obtaining a building permit: Development teams working on an application must submit to reviews in which architects look at the project and try to direct the developers toward the right types of integration technologies and so on, Kessler explains. He notes that the process only works, however, if the inspections come early enough in the process. If it comes when the project is already half done, it can be too late to make a change.
"It's not a magic bullet, and you have to make sure you convey that message right away," adds New York Life's Scott. "You need to present and communicate what SOA is in your shop. That's critical -- to make people understand what it is you're going to get as an end result."
Getting Started
For many insurance companies, simply getting started is one of the largest roadblocks to achieving the benefits of SOA. The industry is naturally risk-averse, a characteristic that comes with the territory of working in the business of transfer of risk. "When you grow a business completely around that philosophical point of view, it is natural that the culture is going to flow down into the IT department and other aspects of the business," according to Paul Dolbec, practice lead, insurance business architecture, Microsoft.
Allstate attempts to drive innovation by devoting approximately 80 percent of its IT resources toward business priorities with the remaining 20 percent devoted to the "business of technology," according to Abbattista. Essentially, he explains, one-fifth of the IT budget is dedicated to projects regarding infrastructure, network upgrades and developing new frameworks -- including SOA efforts.
"Because of our focus, we don't go out and cost justify each of these little infrastructure projects separately," Abbattista says. "We bundle them and do them as part of the business of technology. [The business is] seeing the payback when we say we can do the same functions cheaper and cheaper every year."
At MetLife, Kessler says, a specific part of the IT team -- approximately 12 people -- is devoted full-time to integration technologies. Internal customers looking to deliver business solutions will come to the team with requests to build services, he adds, and often the team already will have the necessary connections developed. "We have examples where [internal customers] were going to do it one way, but it would have cost three or four times what it ended up costing by working with the centrally managed services team," Kessler says.
That team also served to drive the SOA movement at MetLife, when the paradigm still was in its infancy, Kessler continues. Team members were SOA evangelists. Now, though, developers approach the team asking for reusable services, Kessler adds. "In the beginning, the conversations were a little harder because you had to get everybody to start thinking this way," he recalls.
Still, while SOA can offer key benefits -- such as increased speed to market, flexibility in reacting to market pressures, enhanced scalability and simplification of technology stacks -- it isn't the automatic right answer for any technology problem, Kessler concedes. There's no value, for example, in implementing SOA on systems that are largely dependent on batch processing; putting a Web service in the path of a process that extracts millions of records from a batch system database in milliseconds apiece doesn't make much sense, he contends.
"You have to be careful where you put SOA," Kessler says. "But done well, it creates quite a bit of flexibility [and] configurability, allows you to get a high degree of reuse, and gives you a platform to create standardization of how you are integrating both inside and outside the company."
As the insurance industry continues to plug along the SOA path -- starting small but thinking big -- better returns on investments should follow, experts agree. Celent's Josefowicz says that some companies are realizing those benefits now, as some insurance companies are seeing 10 percent to 40 percent drops in project costs. Allstate, according to Abbattista, is shaving 40 percent to 50 percent of its development times in some instances.
"The business value is there to be measured," says Microsoft's Woodman. Problems arise, however, when businesses look for "ironclad guarantees" about just what the business value will be.
"Put simply, SOA, in terms of maturity, isn't far enough along yet that those [business values] are really well-defined and locked, and universally agreed upon," Woodman continues. "It was the same when people went from paper books to mainframe, and mainframe to client/server technology. Advances made in tools and platforms naturally force a rethink on how to approach solving problems in order to take best advantage of those tools."
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