SOA-less Service-Oriented Architecture Pays Off

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September 19, 2007

SOA-less Service-Oriented Architecture Pays Off

It may sound like heresy for a blog that is supposed to tout the wonders of SOA in Action, but not all great integration projects have to be strictly about SOA, at least in the strictest sense of the definition.

Lorraine Lawson at IT Business Edge points to an example of a manufacturer that got its supply chain act together employing basic EDI and XML. As Lorraine so aptly puts it: "It's a This is a textbook example of how integration can transform a business." In this case, she explains, Emerson used two 'older' technologies, EDI and XML, to create an integration hub for its 70 business units and sundry partners.

The challenge, as explained by InformationWeek's Andrew Conry-Murray, was that Emerson, a manufacturer, has 70 separate business units that purchase goods from 35,000 suppliers. "Each unit communicates with its own suppliers via a combination of e-mail, spreadsheets, faxes, and phone calls. Asking a logistics provider to step into the middle of this tangled transaction Web simply wasn't feasible."

Emerson wanted to interact with the outside world as a single entity -- not 70. The solution was a communications hub that supported two data formats -- EDI, using the ANSI ASC X12 format, and OAGIS XML from the Open Applications Group. The Emerson Transaction Hub messaging platform that supports these standards was built on Sun Microsystems' SeeBeyond software.

There was one obstacle Emerson had to surmount before all this was set to go, however. The transaction hub concept had to be sold to the 70 business units, each of which typically make their own IT decisions, as well as outside providers and suppliers. Here, Emerson's central IT department had to serve as a partner to the various departments.

Another challenge was describing standard transactions, such as purchase orders and advance-ship notices, in the EDI and XML data formats. Many of these transactions came out of legacy systems. A PO had to be defined, for example. "We spent a lot of time with our primary trading partners trying to understand the business processes and common processes to support, and then defining a standard transaction," Russ Hermes, Emerson's logistics IT program director, is quoted as saying. This process took about a year to complete.

The effort seems to have been worth it, with impressive results. Emerson spent about $500,000 developing the hub, but reports it "has recovered those costs several times over." For example, putting 10 suppliers in the same shipping container cuts costs by 35%, and the company says it has saved millions in transport costs by consolidating shipping. There's also greater visibility into the supply chain, as well as greater leverage to negotiate deals with suppliers, since Emerson now appears as one united company.

Posted by joemckendrick in SOA | Digg This | Add to del.icio.us