| ------------------------------------- BrainStorm Bulletin e-newsletter of BrainStorm Group May 23, 2002 ------------------------------------- ==================================================== -- INTRODUCTION
==================================================== This issue we will continue coverage of our Chicago events with Ken Vollmer of Giga Information Group and Jorge Perez-Luna of Nextel International. Ken Vollmer is the conference co-chairman of the eBusiness Integration Conference and the Research Director of B2B Integration Strategies for the Giga Information Group. In his presentation titled "Understanding Your Integration Options", Ken makes a very persuasive case for the necessity of integration, and lays out a coherent plan for any business. Ken's presentation also includes a slide on what Giga looks at whenever it evaluates a technology or solution. Ken sees continual improvement in connectivity and increased globalization in an integrated collaborative networking environment. Companies that have the most effective electronic links with their value chains will be the leaders in the next decade, and those that lag behind in this development will come under ever increasing financial pressure. In our Expert's Corner we have Jorge Perez-Luna from Nextel International. Nextel International has operations in five Latin American countries and the Philippines. They must integrate systems from multiple countries that use different languages and legal systems, along with different ways of doing business. Because of their powerful business process management tool, Nextel chose Fuego software to create a single Web-based GUI for everyone. Jorge talks about the process they went through to arrive at their decision, the options they considered and rejected, and how effective the results are. Both Ken and Jorge's presentation archives are available online at BrainStorm University. I look forward to meeting you in New York, Jon Huntress ================================================= Archives include all the sessions from BrainStorm Chicago:
We are pleased to bring access to Chicago sessions as well as all To view the available sessions titles and descriptions visit: Use Priority Code BB502 when you enroll at:
================================================= Ken Vollmer is the eBusiness Integration Conference Co-Chairman and Research Director of B2B Integration Strategies for the Giga Information Group. He covers trends and issues related to all forms of business-to-business (B2B) integration, including business process integration (BPI) and electronic data interchange (EDI). Ken has assisted hundreds of clients in North America and Europe with their B2B integration projects, drawing upon his knowledge of emerging trends and many years of practical experience in implementing e-business solutions. Ken has 18 years of management- level experience in the IT industry. Ken is also the author of a monthly column in Internetweek Magazine that discusses B2B integration issues. The most important thing about integration and why it is so necessary, according to Ken, is that integration enables effective collaboration. It makes many things possible that couldn't have been done before. "Integration automates data sharing by connecting people and applications and actually becomes the foundation of effective collaboration." Ken added that the problem now isn't a lack of information, but too much information. There is so much information that it is useless unless filtered. Too much information, or the inability to extract the right information, means lost sales, poor customer service, production delays, waste, and a negative impact on the bottom line. The traditional value chain is vertical, beginning with an understanding of the customer and market requirements for a product, then rising through the steps of design and engineering, sourcing parts and services for production, creating the product, delivering the product and finally providing ongoing parts and services. This is the way the value chain has been for a very long time, however, this is changing. The problem with this traditional chain is that each step of the process can communicate only with adjacent steps, because they share direct communication. The collaboration value chain is not vertical, but circular with each of the above steps being able to communicate with all others. This communication has to be automated to a high degree and creates a new type of entity that Ken calls the Extraprise, or extended value chain. Extraprise includes the enterprise and its outside customers, suppliers, contractors, and partners. The supply chain, service chain, demand chain, and development chain are all linked. "It is my position that moving forward, organizations that have the most effective electronic links with their trading partners will be the most successful and those companies that are laggards in this area will come under severe financial pressure." He warned. The benefits of collaboration come from using Internet-based connectivity to overcome coordination barriers, design process limitations, time zone and geographical separation. Ken related that GE uses this in an innovative way by starting the day with a team of engineers in India who work for eight hours then pass the work on to a team in Russia who work for another eight hours. They then pass it on to a team in the United States who are just beginning their day. General Electric is getting three days of work out of each 24-hour weekday. The collaborative focus varies for each industry. Industries making a few very complicated units such as an aircraft carrier, need a lot of engineering and design collaboration while a low-tech, high-volume food producer would need forecasting, planning, inventory, and other supply chain collaboration. The integration options are:
Ken said the answer to the first question is to start internally. This gives more control over the process while you are exploring your options. First demonstrating the internal benefits makes later external efforts easier. However, everyone should plan on doing both because the future effectiveness of an organization depends on the electronic links to trading partners. As to whether you should implement your integration program enterprise-wide or divisional, Ken recommends doing it enterprise-wide if you can. Benefits include the lower costs of purchase, support, and end-user training, along with more effective linking of the internal groups and business units. Communications channels are changing, but not as often or as quickly as other things. The traditional channels of store, sales person, telephone, and mail will continue. The older proprietary electronic channels of VANs, leased-lines, and dial-up will also continue. Ken sees much growth in the new Internet electronic channels of eMarkets, ETNs, extranets and Web-forms. While there is some migration away from the VANs, it isn't as much as most people were expecting. Ken listed the different types of integration and spoke on what is happening with each. Data integration is sending one thing one time one-way, and consists of basic bits of data or documents, which are well understood and based on widely used standards of X12, EDIFACT, and EDI. Simple RosettaNet transactions also fall into this category. Data integration is the earliest form of integration and will be the dominant form for some time, added Vollmer. Process integration is more complex and based on the application adapters of OAG, BODS, and complex RosettaNet transactions. Process integration is two-way and consists of multiple transactions going back and forth making up one process-based transaction. This is complicated and involves a number of steps. Initially most assumed that all these processes would be computer to computer, but in reality, human input is needed at many of the steps along the way, requiring this capability to also be built in. Process integration begins with process modeling software, which models a business process. The results are then imported into the workflow and process automation software. The next step is workflow software that automates and manages human-to-computer activities, after which enterprise application integration software automates the exchange of data between internal applications and changes the data from one format to another. The data then goes to process automation software that automates and manages the flow of computer processes, then on to business process integration software that automates the linking of internal business processes with those of key trading partners. At the end of the line there is business analytic software that provides monitoring and analysis of the active business processes to find out if you are making or losing money. The last type of integration is services integration and the one getting the most play right now is Web Services. This is the dynamic delivery of online services using Web-based trading partner connectivity based on UDDI, WSDL and SOAP technologies. Ken said that it is necessary to take a realistic view of Web Services now. The first widespread use of Web Services will be internal, except for those cases where there are no security requirements. Most B2B activities, however, require tight security and will probably not become widespread before 2004. Ken added that Web Services would not be universally adopted because of the technology adoption lag and difficulty of retrofitting existing applications. The barriers to the adoption of Web Services are the existing business relationships and vender certification programs. Most people don't want a computer program to pick a new business partner. Ken said the first thing to do is to create a list of criteria and showed a slide of the criteria Giga uses to evaluate any piece of technology.
Whether to buy, build, or do both depends on several factors. Buying means less complexity and repeatable usage. Organizations looking for a competitive advantage should consider building. Many organizations will choose a mix. The last integration option is whether to use an integration server or an integration broker. Examples of integration server vendors are IBM, Microsoft, BEA, Oracle, and iPlanet. Generally, server integration is easier to implement because the technology is woven into the application platforms. Broker integration is more state-of-the-art. Examples of broker integrators are TIBCO, webMethods, SeeBeyond, Vitria, and Mercator. Ken says he expects a lot of convergence in this area in the next few years. The major trends Ken sees coming are greater access to knowledge, improved connectivity, and increased globalization tied with integrated collaborative networking. These trends will result in businesses that are more resilient to change, responsive to new market conditions, adaptable to new threats and more innovative to new ways of doing business. Ken ended with several recommendations. First, do not abandon EDI technology. It is a proven standard and there are new enhancements to make it current. Don't worry about the data format. Soon we will be able to translate anything into anything else. However, you should supplement EDI with process integration using business process management to optimize SCM, CRM, and ERP. Second, begin evaluating the potential of Web Services. Despite the disclaimers, Web Services is going to be big. Make a realistic assessment of what it can do for you now and in the future. Finally, implement collaborative systems to optimize your business processes. You can hear this presentation and the questions that followed at BrainStormU.com.
Find out when you purchase a 3-Day Conference Package for Early registrants will receive a $100 American Express Gift Cheque. Use Priority Code BB502 when you register by calling 508-393-3266. Jorge J. Perez is Vice President of IT and Wireless Internet Application Development for Nextel International, Inc. Perez oversees IT global strategy, direction, and support to all NII markets. In addition, he heads the design, development, and implementation of wireless Internet applications worldwide. Prior to joining Nextel International, Mr. Perez worked for several years at AT&T Corporation, including holding the position of Director of IT for AT&T's Latin America, Europe, Middle East and Africa divisions. During this time, Perez was responsible for implementing Information Technology planning, strategies and direction in support of AT&T business operations in these regions. Nextel International has operations in Mexico, Argentina, Peru, Brazil, and the Philippines with over 1.3 million subscribers. Some of the markets are growing very fast, especially Mexico. Nextel International is working to create uniform business practices across the diverse Latin American region to increase the value they give to their customers and business partners and to make their business practices more efficient. When Jorge started with Nextel International, there was no business integration at all. The first thing they did was to standardize all their applications on one single platform and then select systems for each country. Integration issues were myriad. For instance, with some simple customer queries, staff would have to input the customer's name five times in five different screens representing fulfillment, credit and collections, customer care, along with intra-system communication. To integrate the system, Nextel looked at three different alternatives. The first option considered was a packaged solution. Packaged solutions are expensive, not flexible or open, would require heavy customization and make them dependent on one vendor for all their operations. The second one considered was an intercommunication solution using a client-server paradigm. This solution is also high maintenance, with integrity and upgrade problems and also would result in vendor dependency. The third solution was to use a Web GUI with a single Web-based user interface. This is a process-oriented approach using open standards and would be vendor independent. Nextel International chose the third solution, of course, with their evaluations involving the CIOs from every country. The most important criteria considered was process management, followed by application interface, message transformation, and connectivity. Fuego came out on top because their process management tool is so powerful. The integration strategy was to have a Web GUI that would feed into a Fuego work-portal for customization and a Fuego OLAP for process monitoring. This feeds into the Fuego Business Services Orchestration, which connects to the back end of billing, provisioning, inventory, prepaid customers, and customer care. The Fuego Business Services Orchestration handles processes, business rules and communicates with the back end systems. Nextel International found that Fuego allowed a dynamic approach to the solution of problems using their business process management tool. One of the problems they found was in the credit checking department in one of the countries. This department consisted of one person who manually checked the credit of partners and customers. He placed the people and firms to check on the left side of his desk and the completed checks on the right side. He neglected to tell anyone when he went on vacation for two weeks and no credit checks were made during his absence. The result was a substantial loss of business. The solution they needed was to automate the process. As a result, the process is redundantly checked and the credit status of an applicant can be checked hourly if that is required. During development, they initiated a Fuego design that would compare the existing system with an optimum one. They then developed a proof of concept and moved it into production. The business benefits were large across the enterprise.
The process for implementing the integration project was to first identify the critical issues, then the business goals, followed by identifying the success factors. The steps that followed were doing the requirements analysis, prototyping and the use cases. Next came process and object modeling, followed by parallel development, configuration management and issues management. Then the integration and performance testing was done, followed by user acceptance, training and deployment. Jorge said the main problems encountered were business processes that weren't adequately defined or understood. Business units and users need to understand that charting business processes isn't something that is just delivered to them from on high, but something that involves everyone. This process itself has to be orchestrated across the enterprise. There has to be a balance between giving customers what they want and the enterprise business goals. Perez said that each area of the business such as sales, marketing and so on, should have its own business objectives. Once these are defined, you can figure out the business metrics from the business goals. Once the metrics are there, the course becomes clear. You can hear Jorge Perez-Luna's presentation and view his slides at BrainStormU.com. By William M. Ulrich Commercial application and data architectures support key business and government operations around the globe. Any organization that believes it can address information-related business requirements by replacing, wrapping or ignoring legacy information assets is sadly mistaken. This book is about legacy information architectures, the challenges they pose and strategies for leveraging them to meet critical business requirements. To reserve your advanced copy call 800-811-0912 or visit: http://www.systemtransformation.com/legacy_book.htm 10 Years of Integration Leadership We integrate more enterprise systems than anyone else in the industry. Formerly the Middleware Technology Group of Information Builders - one of the world's largest independent software companies - iWay's integration technology was co-developed with IBM and first introduced in 1991. Our enterprise heritage and ten-year track record make iWay Software one of the largest, most experienced, and most trusted integration vendors. Our "e2E" Business Value iWay's "e2E" software products tie e-business applications to the Enterprise. Our integration middleware connects e-business platforms with back-office information assets - including difficult-to-reach legacy systems, ERPs, transactions, and messaging workflow applications. iWay Principals and Executives The leadership team of iWay Software is comprised of seasoned professionals with over 200 years' combined experience in the software industry. For more information visit
www.iwaysoftware.com or email:
info@iwaysoftware.com.
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