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Different industries have different priorities and adopt SOA in different ways. Ilog has just announced that their rules product, JRules is being used in Hiscox (a major insurance company which focuses on specialist and hence more complex insurance products). By a strange co-incidence, Elizabeth has just announced an upcoming event on SOA and the insurance industry.

The Ilog announcement is interesting in that it clearly states two of the most common requirements in Insurance that SOA (and in this case SOA with additional business rules) tries to meet - and one which is less commonly stated:

“First, Hiscox wanted to be able to add new distribution channels as quickly as possible.

Second, the company wanted to reduce the time and cost associated with both making changes to existing products and bringing new products to the market.

Finally, Hiscox needed to increase the ability of underwriters and business analysts to make changes to rules directly without having to change complex system logic, allowing the company to improve its business response time.”

The ability to add new distribution channels is common across financial services. As the products are purely electronic, adding a distributor is equivalent to integrating their systems with your own. This requires mediation of the message formats and flows – clearly Hiscox is using a rules based approach but of course others are possible.

The need to get to market quickly with novel products is also common across insurance, retail banking and its most extreme case in derivative trading. Again, it requires good message manipulation capabilities in the middleware.

The final requirement is to my mind the most controversial and clearly the most valuable if achieved: To take IT out of the loop when changes need to be made. If it can be done, it has clear cost and agility benefits. However to be successful it requires well formulated message formats, well understood processes and above all careful controls around what can be changed as the underwriters and business analysts are unlikely to appreciate the implications of their actions in the way IT staff have been long trained to do.

Ronan

Posted by rbradley in Financial Services • Product news • SOA concepts |Digg This|Add to del.icio.us

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