Proving CIO Worth

As a long time participant in the computing industry and the founder of four different software companies, I am intimately acquainted with the challenge of proving value. Whether it's for our boss, investors, customers, partners, or our spouse, we are constantly being asked to prove our worth.

It's no different for today's CIO. Until recently, a CIO's value was proven by their level of technical knowledge and their ability to oversee technology investment and manage the IT organization. Now, the value that a CIO is expected to deliver has shifted.

Managing and communicating value and providing tangible evidence that IT can help grow business, not just support it, was at the top of the list in the Meta Group study entitled "Top CIO Issues for 2005." Business and IT alignment was the second concern.

According to Bobby Cameron, principal of the CIO Group, Forrester Research, supporting business innovation and business growth are two of the top issues facing CIOs in 2005. To that end, he said that IT organizations need to employ cross-organizational business models that provide incremental value.

In Jan 2005, cited a survey of roughly 1000 Deloitte practitioners worldwide. The results of that survey were that providing business value to the company and delivering business integration were two of the top four challenges CIO's were facing in 2005.

Clearly, demonstrating that IT delivers business value is a top priority for 2005 — a CIO's job is dependent on it. This requires aligning IT with the business strategy of your company and can be achieved by collaborating with business leaders to prioritize assets and execute projects in areas that produce the highest return.

But delivering business value with applications using traditional development and integration methods is extremely difficult. My career has revolved around solving technical challenges to create business value. In the '80's I founded Informix, one of the first relational database management systems (RDBMS). Using SQL as the foundation, we made it possible to organize related data into a particular application and opened the door for a revolution in enterprise computing. But as soon as there were two different databases, there were database silos, a problem we still deal with today.

My next venture was co-founding The Vantive Corporation, one of the first customer support applications. Vantive also pioneered the meta data-defined, multi-tier architecture that became the chosen approach for all new enterprise applications. Companies like PeopleSoft, SAP, and Siebel all migrated to this architecture establishing the packaged applications industry.

There is a lingering downside here as well. Packaged applications always have their own database and thus have created thousands of silos. The increasing complexity of corporate IT infrastructure and contending with 40+ years of legacy applications makes it difficult to even know what all we have, let alone figure out how to effectively repurpose or integrate it into new solutions that provide concrete business value. But there is now a solution to this.

Getting from here to there - Embrace SOA

For today's CIOs, the path to solving the challenges brought about by these different innovation eras is to continue the adoption of Web services and service-oriented architecture (SOA). The promise of SOA is to:

  • Eliminate information silos.
  • Improve IT and business agility.
  • Achieve application integration more easily.
  • Use existing technology investments more efficiently.

SOA is enjoying wide adoption and Web services are the logical approach for creating the services for an SOA. Web services, however, are not the complete answer to achieving the SOA vision. They don't resolve several common challenges:

  • Difficulty in mapping business requirements and processes to underlying information systems.
  • Contending with the sprawl of redundant information and inconsistent
  • definitions of business functions across various applications.
  • How to make the most efficient use of IT talent and resources.

There is also an answer to the challenge for creating integrated business solutions from the services in your SOA.

Facilitating better business integration - composite applications

By making better business integration possible, SOA unlocks the potential for capitalizing on the huge IT investments companies have made. And the road to better business integration is composite applications. This concept was first formalized by Gartner in 1998, and today it is a reality. Composite applications are an architectual pattern for creating new applications, not a new programming model.

A composite application is a transactional application comprising business functionality and information from one or more information and business logic resources. Composite applications work best for organizations requiring integrated business processes that cross different corporate and external constituencies. They are crucial for portfolio management, strategic alliances, supply chain management initiatives, and for organizations anticipating mergers and acquisitions. Composite applications make handling these diverse business needs possible because they differ from traditionally integrated applications in several important ways. At the highest level, composite applications:

  • Don't move data move back and forth between enterprise applications. Instead, they interact with business logic components in real time.
  • Leverage Web services and the simple set of standards and successful technologies they comprise.
  • Can be deployed across a wide variety of user-defined environments, including rich, thin, mobile, and portal clients.

In addition to these key advantages over traditional integration mechanisms, there are specific best practices associated with developing and deploying composite applications that will provide further business value:

  • Create reusable 'business services' - business logic building blocks, if you will - so they can be quickly assembled and re-assembled to provide new functionality across different business scenarios.
  • Assemble — don’t code — your composite application from these business services to facilitate faster deployment with lower costs and accelerating the time to impact.
  • Use tools to assemble and reassemble existing services into composite services, and make these combinations available as standards-based Web services so they can work with any 3rd party tool.

Most importantly, composite applications provide the business value and justification for why a company would embark on an SOA.

Enabling tighter alignment between business and IT.

Services representing specific business processes are defined in business terms — not computer terms — bringing about better understanding and closer collaboration between business and IT.

Increasing flexibility and agility to meet changing business needs.

When the time comes to change and evolve applications, it's easy for business leaders to communicate their needed process changes. The business services — because they are not hard coded — can be quickly reassembled to deliver new functionality.

Making better use of IT assets, both people and infrastructure.

IT and business professionals with a broad range of skills can help build composite applications. Those with deep application expertise and extensive coding skills can be used to isolate various application functionality and the create business services from them. But once this is done, those with a stronger affinity to the business processes can assemble the applications.

Existing applications can be more readily extended or repurposed making their functionality available to a broader range of users. And because composite applications can be quickly assembled, projects that were too expensive to justify with traditional approaches are now cost effective.

Ultimately, composite applications provide CIO's the answer to delivering better business value to the company.