New Forrester Research Uncovers The Truth About Web Services
Available today, a new Forrester Research (Nasdaq: FORR) report examines why CIOs must adopt new IT governance policies for Web services — software designed to be used by other software via Internet protocols and formats. Seven recent reports from Forrester Research explore what CIOs and their executive teams need to know about Web services. These reports examine how Web services technology will evolve and the impact of Web services on CRM and supply chain projects, IT budgets, vendors, and security policies. The following abstracts highlight Forrester’s latest library of Web services research and what it means for IT executives and marketing and business strategists.
“CIOs: Govern Web Services Now” — Bobby Cameron, Principal Analyst
Firms today anticipate little difficulty managing Web services — most are awaiting maturation of standards before adopting the new technology wholesale. The problem? Any developer can build a SOAP interface, any manager can fund it, and any application can call the interface, creating a free-for-all environment where use of Web services will proliferate beyond the reach of IT¿s standard approach to software development, deployment, and operation. CIOs must adopt new governance for Web services to prevent this freeform growth or else risk duplication of efforts, loss of quality, and operational errors. This July report explores how successful CIOs will develop Web services governance in three waves.
“The Truth About Web Services” — Ted Schadler, Group Director
Web services will affect every member of the executive team. For CEOs, Web services is about strategy, locking in customers with better product and service links. CIOs will gain more control using Web services. COOs will tap the technology to improve business operations and productivity. CFOs will use Web services to cut costs. And for the CMO, Web services are about influence, extending the corporate brand out through a new business delivery channel.
The truth about Web services is that companies and individuals will use Internet middleware — software that lets applications exchange data — to eliminate the barriers to applications working together. This is achieved by unlocking vast stores of data to link and relate unconnected applications, services, devices, and even sensors and actuators. The Web services evolution will occur gradually in three waves between 2002 and 2006, affecting the industry in a subtle, bottom-up, cumulative, and ultimately pervasive way as developers use simple tools to build new software networks that draw on untapped value.
“Which Web Services Vendor?” — David Truog, Principal Analyst
Which Web services vendor is right for your project? Forrester believes that firms should start with a bet on a software infrastructure heavyweight and augment that platform with Web services startups. For vendors, the future is now clear: Recast products around Internet middleware — from XML to SOAP and WS-Security — or die. The major infrastructure software vendors are giving their product lines full Internet middleware transfusions, and packaged apps vendors are exposing entirely new APIs for standards-based assembly. A host of focused startups have evolved in tight lockstep with the evolving Internet middleware standards.
“Apps Market, Interrupted” — Laurie M. Orlov, Research Director
Apps vendors are held hostage to a high-margin business model. Facing decelerating demand for their old client-server-type apps, apps vendors provide half-baked and still-costly efforts to ease user frustration. At the same time, users are experimenting with Web services in a quest to connect their enterprise applications to employee portals. As Web services experimentation turns into adoption, Forrester identifies three trends that will reshape the apps market and overturn ISV business models by 2004:
1) User interfaces will shift from individual apps to role-based transactional portals.
2) Enterprise apps will deconstruct from monoliths into components.
3) Licensing models will morph from individual seats to metered services.
“Securing Web Services” — Laura Koetzle, Analyst
Despite the frenzy around Web services, security concerns remain unresolved. Pressed by prospective Web services customers, many vendors are proposing security standards and products that miss the point. The scale and scope of Web services will require new standards and new ways of thinking about problems, such as who’s at the other end of the wire, who’s listening to the traffic, and what if something goes wrong between several tiers of partners?
Instead of relying on traditional piecemeal security strategies, Forrester recommends that CIOs stop building one-off security systems and deliver security as an abstracted network service that provides multiple levels of authentication, authorization, and encryption. This network is built on the principles of what Forrester calls “Organic IT.” Security abstraction will allow firms to offer Web services securely. It will also yield:
1) Security that scales to match the rest of the infrastructure.
2) Any-to-any integration without the need to exchange security infrastructure details.
“Web Services Erode CRM Barriers” — Bob Chatham, Principal Analyst
Integration costs, mutual buy-in across business units, and IT involvement create tough barriers to effective CRM implementation. According to Forrester, only 14 percent of firms enjoy the trinity of high business/IT coordination, high executive support for technology, and high risk of tolerance — good traits for a coherent CRM strategy. The other 86 percent must find a different way that balances managers’ parochial needs against the collective good of cooperating to serve customers.
Web services, even in their nascent state, plug the gap between doing nothing and robust — but complex — EAI technology. Because of this practicality, Forrester believes that firms will embrace Web services to:
1) Share data and status about demand, opportunities, orders, and service requests.
2) Centralize key services for common customer IDs, pricing, and configuration.
3) Build role-based transactional portals to foster data and functionality sharing.
“Web Services’ True Costs Revealed” — David Metcalfe, Analyst
To discover the reality of Web services, Forrester surveyed 70 European executives from IT, marketing, and general management at its April 2002 Leadership Forum Europe. Forrester learned that firms spend little on Web services today, but 84 percent plan to spend more in 2003. Forrester built a cost model to calculate the costs for a loan application portal and for an inventory management system and determined that the true cost of strategic Web services projects will soar 10 times higher than entry-level projects due to consulting spend and staff.