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What is the impact of Web Services on CRM?
Posted Mar 25, 2002
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The claim that web services will eliminate complex integration and allow companies to string together many different application components independent of vendor, architecture, or business purpose is like saying that a grammar book plus a telephone line will solve universal communication. While web services does provide a means to connect different application components and share data in common formats, it does nothing to define and standardize the "verbs" and context of business transactions - such as orders, service request, or customer interactions. Web services is most valuable when combined with a clear business purpose and a set of committed participants, and as such could be a key enabler (although not a full solution) to emerging CRM business issues such as customer data integration, demand chain partner integration, and more seamless access to internal and external systems and functions. The evolution from plumbing oriented APIs to useful business services will be gradual and sometimes painful - watch the vendor hype and wait for real, business-focused implementations before embarking on web services application initiatives. The mind-numbing set of alphabet soup (UDDI, SOAP, WSDL, XML, etc.) that is web services comes down to the idea that applications should be able to connect to needed services on the fly - independent of type of application, operating system, network protocol, etc. However, while applications can connect, it's not clear that they can truly communicate. Meaningful CRM advances in web services will come where both participants share a common "language" - data definitions, business context and application "state" - that can be combined to accomplish real work. In CRM, like many other application areas, there are three emerging classes of problems that meet the criteria of having participants close enough to share a common language but diverse enough to value the heterogeneity benefits of web services. These are application integation, data integration, and business process integration. Each requires additional infrastructure and application above and beyond the web services APIs, and will take time to mature and evolve.
Application integration. Web services in its current plumbing-centric form is a natural fit for loose application integration such as display of external information (driving directions, customer news, shipment status) or simple exchange of information between systems (order, address changes, etc.). Processes and applications tend to be independent and complementary. However, participants must agree on some conventions to be able to display and act on results, an ongoing focus for portals APIs (information consolidation or subscription, function invocation) and EAI and enterprise application "connectors" (common data descriptors, simple transaction handling). Data integration. Emerging customer data integration vendors are jumping on the web services bandwagon as a platform to access integrated customer information across many back end transaction systems. IBM, Oracle, DWL, Journee, and Siperian all offer some form of customer integration solution based in part on web services (or XML moving to web services). Solution functionality beyond web services includes pre-defined customer data models, customer key matching (particularly critical when no common key exists to link the information), intelligent caching, rules for privacy and other policies, and events to trigger relevant actions. Process Integration. The most complex form of web services are those where a single set of coordinated actions are linked together across a set of companies, departments, and/or systems. While this is the promise of web services, process integration requires a complete application of its own, including a way to define and maintain processes, present information, specify business rules and workflow logic, and establish a shared semantic context (common understanding of field names and meaning, actions, rollback of in-progress work, etc.). J2EE and .NET CRM vendors (Chordiant, E.piphany, Kana, Onyx, Pivotal, etc.) offer rudimentary process integration by using web services for their own inter-application communication (offering more customizable and adaptable deployments but somewhat equivalent to talking to yourself - with all the associated semantic shortcuts), which also provides limited process integration with closely-connected external systems. However, true cross-system process integration across many peer systems will remain a custom effort and require complex business negotiation and coordination - not just technology - to be successful. Recommendations: • Web services is an enabling technology, not an application (or even an integration) solution. Expect to spend significant time and resources to turn "connection" into meaningful application communication. • Just because a product or application supports web services doesn't mean that it offers useful application or business integration. Understand how the vendor uses web services to solve a business problem, and which type of integration (application, data, process) is supported in order to assess usefulness and value. • Investigate web services first for internal systems controlled by the company. start to build a vocabulary" of common terms (customer, value indicator, status codes), actions (order, repair, sell, ship, service, escalate), and conditions (in progress, hold, waiting for input, cancelled) that can be used to establish meaningful communication between systems. • Proceed carefully when "the integration is the application" (workflow, cross-business unit or company processes, etc.) as web services alone doesn't specify enough capabilities to enable this type of application without significant proprietary code. Use early efforts to understand integration and business issues, and expect to rewrite over time.
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