Waves Of Change

Web services promise to be the technological equivalent of being in the right place at the right time with just the right information at your fingertips. And some say the technology will hit the IT world like a tidal wave.

"Web services is a tsunami of technology evolution," Andre V. Mendes, chief technology integration officer at Public Broadcasting Service (PBS), said at the Computerworld Premier 100 IT Leaders Conference in February. He said the Alexandria, Va.-based nonprofit organization uses Web services to connect upstream with content developers and producers and downstream with public TV stations and viewers. "What we're developing is a supply chain optimization that puts us right in the middle of this equation," said Mendes.

Over the next several years, Web services are likely to enable companies to get a lot more out of technologies such as supply chain systems and CRM, and they're likely to make it easier to build new applications and integrate existing ones. Here are some snapshots of how Web services are expected to change key parts of the corporate IT agenda:

Business Intelligence and CRM

Most of the major business-intelligence and CRM vendors plan to support Web services in their products or are already doing so, and Web services are expected to make those applications more readily available to internal users and external business partners.

Web services -- with their standardized application programming interfaces -- will allow analytical tools to be more easily embedded in standard applications, says Michael Corcoran, chief communications officer at Information Builders Inc. in New York. The latest release of the company's business-intelligence product supports Web services, allowing reports to be created and published as a Web service accessible from Java 2 Enterprise Edition or Microsoft Corp.'s .Net environment. "Web services will make business-intelligence components usable with many other applications," such as call center or Web customer service applications, Corcoran says.

Just imagine the systems that could be improved with real-time transactional data delivered by Web services. For example, a manufacturer could use a business-intelligence system to forecast demand for raw materials and then employ Web services to relay the data to numerous suppliers producing those materials. An insurance company could more easily and quickly send CRM information -- such as a customer's previous complaint about a policy -- to a call center agent to help provide better service.

"The point of Web services is to make it easier for people to construct and integrate applications," says Henry Morris, an analyst at Framingham, Mass.-based market research firm IDC. "Web services, combined with standards like XML, will make it easier for people to tie business-intelligence and CRM applications together. That's where you get the real value out of business intelligence; not just getting a report, but being able to act on it and get feedback."

Joe Wanzek, vice president of IT at American Equity Investment Life Insurance Co. in Des Moines, Iowa, says his company already has an in-house CRM application that provides transaction information to customer service representatives. But with Web services, Wanzek expects to be able to deliver that data via the Internet to customers just as quickly. That will eliminate the need for costly and time-consuming phone calls to work out customer complaints or answer queries, he says.

Supply Chain Systems

The adoption of Web services is expected to enhance the way businesses conduct transactions with one another electronically and the way information moves through the supply chain.

Mitsubishi Motors North America Inc. in Cypress, Calif., uses Web services to link 700 dealers through its portal -- a single point of entry for dealers online, says CIO Tony Romero. "Anything a dealer needs to do can be done through the portal, no phone calls necessary," he says.

The key to easier integration is the fact that Web services are based on widely adopted standards such as XML. "It changes the integration game; it will be much easier to [link systems] because of the open standards," says Toby Redshaw, corporate vice president of IT strategy, architecture and e-business at Motorola Inc.

"When you map the supply chain today, starting with source material, all the way to product repair, you'll find there are 10 to 12 disconnected processes with big gaps and integration issues," such as how to handle product repairs and returns, Redshaw says. Web services will help trading partners fill those gaps by providing better communication among their supply chain applications, he adds.

In many cases, transactions among trading partners, such as ordering supplies, fulfillment, billing and inventory management, will be wholly automated, says Mike Gilpin, an analyst at Giga Information Group Inc. For example, a retailer could develop a standardized, automated program for ordering goods and then use the program to allow its purchasing applications to work with suppliers' inventory systems.

This will be a less complex and time-consuming endeavor than it would be without Web services. Automation will also help reduce costs, Gilpin says. "One of the impediments to B2B commerce has been cost, and I think costs will be reduced gradually by Web services," he says.

In addition, Gilpin says, the combination of Web services and technologies such as radio frequency identification tags will enable companies to track the location of products in real time as they move through the supply chain, while gathering data about overall demand, purchasing trends and inventory.

Within three years, Redshaw predicts, intelligent Web services will emerge that completely automate a lot of supply chain management functions, such as handling customer queries from call centers or feeding customer-retention data to salespeople in real time.

Application Development

Industry experts expect Web services to speed up and simplify application development, allowing IT departments to not only create new applications in less time, but also to deliver them to more internal and external users.

"You won't see a whole new array of things that you couldn't do before because of Web services, but you'll see application development enabled much more quickly," says Larry Calabro, a partner in the technology integration unit at Deloitte Consulting in Chicago. Calabro says Web services standards will make it easier for companies to build applications that more effectively integrate existing software packages such as CRM and ERP. "The focus of application development will be to make all those assets work together to better meet business goals and better serve customers," he says.

Web services will make it easier for less-skilled people to more rapidly build applications through their standardized application development tools, says Michael Blechar, an analyst at Gartner Inc. "Web services standards like XML and UML are providing much more automation" in the process of developing and sharing applications, Blechar says.

The ability to recycle software code is another benefit, he says, pointing out that teams of developers will be able to reuse components and place them into applications, rather than having to rewrite existing code. "The whole philosophy of Web services is based on reuse," Blechar says. "Clients, supply chain partners and people inside the organization will be able to reuse components."

Wanzek of American Equity agrees. "As XML becomes more of a common tool," he says, "it will allow us to provide quicker and more reusable application development."

Violino is a freelance writer in Massapequa Park, N.Y. Special projects editor Ellen Fanning contributed to this article.

Special Report

The Web Services Tsumani

Stories in this report:

Copyright © 2003 IDG Communications, Inc.

7 inconvenient truths about the hybrid work trend
Shop Tech Products at Amazon