Service Oriented Enterprises Dr. Setrag Khoshafian VP of BPM Technology Pegasystems Inc

Service Oriented EnterprisesService Oriented Enterprises

Dr. Setrag KhoshafianVP of BPM TechnologyPegasystems Inc.www.pega.com

http://www.pega.com/

2 Pegasystems 2006

3 Pegasystems 2006

What are Service Oriented Enterprises (SOEs)?

• You have a technology perspective:

Loosely couple applications, trading partners, and organizations

• Invoke via service calls.

Services involved in processes with human participants

• Provides even greater value than the sum of component services.

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What are SOEs?

• You also have a cultural perspective:

Each party sees herself as a service provider as well as a service consumer

Focus on serving various communities: • Customers• Shareholders• Trading Partners• Employees• Government

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Community

Customers

Shareholders

Partners

Government

Employees

SOE

Service Oriented Enterprises (SOE)

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SOE Goal

• Align Business and IT

IT Business

SOA Technology Alone Will Not Do It

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SalesSales ServiceService OperationsOperations ComplianceCompliance PartnersPartners

Management GoalsManagement Goals


SystemsSystems

SalesSales ServiceService OperationsOperations ComplianceCompliance PartnersPartnersSalesSales ServiceService OperationsOperations ComplianceCompliance PartnersPartners

The SOE Challenge…Execution Gaps!


SystemsSystems

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Business Changes Worsen Execution Gaps

Business Changes Worsen Execution Gaps




SystemsSystems

The SOE Challenge…Execution Gaps!

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Solution: SOE Architecture

SOE Architecture=

Performance Management +

Business Process Management +

IT SOA Architecture (ESB)

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The Service Oriented Enterprise

IT Service InfrastructureService Oriented Architecture

IT Service InfrastructureIT

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Service Infrastructure

• Loose Coupling

• Standards Based (WS-*)

• Discovery

• Service Composition

• Enterprise Service Bus

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Loose Couplingisolated from the details of the service’s

implementation language, platform, location, or other details

InternetInternet

GET/POST Request

HTML Response

Server (s)

InternetInternet

SOAP Request

SOAP Response

Server (s)

Client

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Service Transport: HTTP/HTTPS

Remote Service Request/Response: SOAP

Service Description: WSDL

Service Transactions: WS-Transaction/WS-Coordination

Quality of Service: WS-Security, WS-ReliableMessaging

Business Processes and Rules: BPMN, WS-BPEL, WS-CDL

Service Management: WSDM

Service Content and Portals: WSRP

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Capabilities and Features of an ESB

• Message Transformation• Protocol Transformation• Message Routing• Security• Transaction • Orchestration• Service Registry

Consumer Services requests use a transportprotocol (e.g. JMS) different from theprotocol (e.g. HTTP) of the Provider

Transform Provider message format toConsumer message format and vice versa

(XML to ASCII, XML to XML, etc.)

Content based routing of Consumer messages to appropriate Provider & Vice

Versa. Support for rules based routing

Support for WS-Security, SAML, encryption,Authentication and Authorization

Support for WS-AtomicTransaction,WS-Coordination, WS-BusinessActivity

Micro-Flow Orchestration & Choreography

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Enterprise Performance ManagementService Performance

Bu

sin

ess

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Strategic MethodologyFinancial

Internal

Learning

CustomerVision

Enterprise Performance Management

Business Activity Monitoring

Business Intelligence

Business Process Management System

Enterprise Service Bus

CI Methodology

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Enterprise Performance ManagementService Performance


ITB

usi

nes

s

Service Oriented Enterprises, Dr. Khoshafian

Service Oriented ArchitectureIT Service Infrastructure

Business Process Management SuiteService Integration

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BPMSuite

Workflow

BPMBPM Suite

• Modeling and Simulation

• Business Rules

• Business Activity Monitoring

• Solution Frameworks

• SOA support

• Alignment of business & IT

• Integration:

• System Participants

• Trading Partner Participants

• Process Portals

• Organizational Model

• Rich Process Data Model

• Human Participants

• Flow automation

• Flow status management

• Document and Content Centric

• Workflow Reference Architecture

Evolution of BPM Suites

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Enterprise Policies and ProceduresEnterprise Policies and Procedures

PoliciesProcedure

PoliciesProcedure

Modeled Policies and ProceduresModeled Policies and Procedures

Strategy and Vision ModelsStrategy and Vision Models

Process ModelsProcess Models Business Policy ModelsBusiness Policy Models(business rules)(business rules)

Information & Integration Information & Integration ModelModelOrganization ModelOrganization Model Modeled

AndAutomated

Policies and Procedures

ModeledAnd

AutomatedPolicies and Procedures

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BPMSuite

BusinessBusinessProcessProcess

Monitoring &Monitoring &AnalyticsAnalytics

BusinessBusinessRulesRules

WorkflowWorkflowSolutionSolution

FrameworksFrameworks

EnterpriseApplicationIntegration

Business ToBusiness

Integration

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System/Partner and Human Participants

OrchestrateOrchestrateOrchestrate

Buyer Seller Shipper

ChoreographySellerBuyer Shipper

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Remitter BeneficiaryBeneficiary Bank (Using Smart Investigate)

Remitting Bank

Parse message Check for duplicate cases Create case & route Attach message Locate & attach payment transaction Evaluate transaction

Status=Complete? STP?

Look up customer record Issue notification of assignment Contact remitting bank Schedule chasers Assign SLA

Parse message Check for duplicate cases Create case & route Attach message Locate & attach payment transaction Evaluate transaction

Status=Complete? STP?

Look up customer record Issue notification of assignment Contact remitting bank Schedule chasers Assign SLA

Unable to Apply11

Notification ofAssignment 33

Unable to Apply22Unable to Apply44

Notification ofAssignment55 Update case

Attach message Issue notification of assignment

Update case Attach message Issue notification of assignment

Notification ofAssignment 66

Send chaser Send chaserCase Status

Request77

Case StatusCase StatusResponseResponse88 Update case

Attach message Update case Attach messageResolution of

Investigation99

Resolution ofInvestigation1010 Resolve case

Attach message Send resolution message Levy service fee

Resolve case Attach message Send resolution message Levy service fee

Resolution ofInvestigation 1111

ST

PS

TP

Unable to ApplyExample of SWIFTNet E&I Straight-Through Process

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BPMSuite



BusinessRules



EnterpriseEnterpriseApplicationApplicationIntegrationIntegration

Business ToBusiness ToBusinessBusiness

IntegrationIntegration

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Example

IFDispute Amount is less than $51; AND

Transaction is not disputed as a fraudulent transaction;AND The customer has disputed less than two transactions this year;

Write-Off?

YesNo

Selection: World MasterCardVIP Customer

THEN Fully credit the customer without even initiating the dispute i.e. Write-off the transaction.

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Tasks

Par

tici

pan

ts

Rules

Pro

vid

er

Req

uesto

r

h

Req

uesto

r M

an

ag

er

Pro

cu

rem

en

t D

ep

art

men

tS

hip

pin

g

Approve

Yes

Review Request and

Assign

Receive

Ship to Requestor

ApprovedBudget

Yes

Process

Order

Ask

For

Revisition

Check

Budget

Revise

Request

No

Request

Procurement

No

Yes

Send

Order

Accept

Order

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BPMSuite




WorkflowWorkflowSolution

Frameworks




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HealthcareMember Extensions

Customer Process Management Framework BPM Solution Development

Customer Processes and Rules Customer Profile Customer Entitlement Cross Sell

Customer Dispute Agreement Renewals Customer Interaction

Insurance CustomerRelationship

Banking CustomerRelationship


Business ToBusiness

Integration

BusinessProcess

Monitoring &Analytics

BusinessRules

WorkflowSolution

Frameworks

BPM Suite

Greater speed to market and use of best practices enable faster achievement of competitive advantage

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BPMSuite

BusinessProcess








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BusinessTo

BusinessIntegration

BusinessProcess


BusinessRules

Workflow SolutionFrameworks

BP

MS

uit

e

AnalyticMeasures

Business ActivityMonitoring

BusinessIntelligence

StrategicMethodology

Example:BalancedScorecard

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Link Executing Processes To Strategies

Connecting measurable objectives to executing processes and rules, and continuously improve them – in real time.

Customer Satisfaction Index

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Strategic MethodologyFinancial

Internal

Learning

CustomerVision

Enterprise Performance Management

Business Activity Monitoring

Business Intelligence

Business Process Management System


CI Methodology

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Continuous Improvement LifeCycle

Agents

Six SigmaBlack Belt

ProcessArchitect

BusinessAnalyst

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BPMSROI

Expenses• IT• Business• Staffing

Revenue• New Products• New Processes• Customer Retention• Up Sell• Cross Sell• M & A

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High LevelHigh LevelStructured Structured

ProgrammingProgramming

ObjectObjectOrientedOriented

ProgrammingProgramming

BPMS

X2 to X3

X5 to X10

X2 to > X10

AssemblyAssembly

Productivity Gains

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ServiceService OperationsOperations ComplianceCompliance


ServiceService OperationsOperations ComplianceCompliance

SystemsSystems

SalesSales ServiceService OperationsOperations ComplianceCompliance PartnersPartnersSalesSales ServiceService OperationsOperations ComplianceCompliance PartnersPartners

BPM Suites for the SOE Challenge…


SystemsSystems

Business Process Management SuiteService Integration

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LocalCommunity

Customers

Shareholders

Partners

Government

Employees

SOE

Competitive Advantages for all Communities

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Conclusion• SOE can serve their communities through:

Directly Capturing requirements: • Executable processes and rules

Identify measurable KPIs: strategic methodology

Tying these KPIs to modeled and executing business processes and policies

Continuously monitoring and improving the implementation to meet the needs of the communities

• … while leveraging the underlying IT SOA infrastructure

Documents

Service Oriented Enterprises Dr. Setrag Khoshafian VP of BPM Technology Pegasystems Inc