Saugatuck sees positive signs of SOA adoption growth, including broad and deep support and promotion by Master Brand IT vendors. Just this week, IBM hosted its' "Impact" WebSphere event in Orlando, with the tagline, "It's going to be a defining SOA event." The event, in which Saugatuck participated, included more than 200 sessions, 4,200 attendees, and a parallel event in the Second Life online environment, which boasted more than 4,600 registrants.

Just last week, Saugatuck reported on SAP's next-gen version of its business software, currently code-named A1S -- as outlined by Hasso Plattner, SAP co-founder and Chairman, at theSoftware 2007 conference (see Software 2007: Conference Trip Report, RA-346, 16May07).  Amid the wide-ranging talk, Plattner emphasized that SAPs new suite of business software is built upon 2,500+ exposed services interfaces, with SOA at the very heart of the vision.

And other Master Brands continue to promote SOA. Earlier this week, Salesforce announced Salesforce SOA, which extends its Apex programming environment so that it can leverage a variety of web services. HP has built a very solid, integrative sales strategy and expanded its services offerings to promote and deploy SOA as a user enterprise architecture. And Oracle continues to heavily emphasize SOA, including through promotion of its Fusion middleware technology.

Why is it Happening?  For all of the hype about SOA being driven by business need, the reality is that SOA is first and foremost being positioned and sold as an IT "toolbox solution" rather than as a product -- a core technology-based approach to be used in solutions. Saugatuck research indicates that user business executives tend to understand products better than concepts.

And while the SOA concept is relatively simple, and it is heavily promoted as being "business-driven," discussions about SOA quickly devolve into technologically-heavy descriptions of software architecture, services, coding, standards and interfaces. The IBM WebSphere and SOA "Impact" event this week in Florida offered example after example of user IT executives starting off by talking about their enterprise's business problems and SOA -- and quickly diving deeply into complex architecture diagrams and acronyms.

SOA must also contend with the traditional silo'd structure of IT and business. It requires a strong IT organization and leadership to coordinate SOA planning and execution across these silos -- especially to secure and coordinate funding for shared services. Saugatuck has noticed a peculiar "chicken and egg" situation when it comes to SOA and IT leadership. Enterprises with strong IT leadership -- meaning a strategic-minded CIO with authority (and budget) at the business planning table -- tend to have more and more successful, SOA implementations. But whether it is SOA driving strong IT, or strong IT driving SOA, is yet to be seen.

Finally, SOA vendor sales tactics continue to miss the broader audience. They overwhelmingly emphasize a climate of fundamental and necessary business change, and a demand for innovation by user executives, as key factors that should push user enterprises toward SOA. In reality, while user executives may see innovation as being required to compete in most marketplaces, they by no means agree on what "innovation" means, or how important it really is. Saugatuck's C-Team research published earlier this year indicates that CIOs tend to be twice as convinced that innovation is absolutely necessary to developing and sustaining competitive advantage than CEOs (see Research Report C-Team Research: Growth and Innovation Driving the Global Business Agenda, SSR-325, 28Feb07).

And while SOA can enable business innovation, there are not yet enough clear and articulated links between SOA and business innovation for CEOs to understand. Of course, this is a function of the relatively nascent nature of SOA, with users and vendors alike still learning how to approach it. And it is important to note that several Master Brand IT vendors understand this and are taking steps to address it. IBM this week, for example, announced eight industry-specific SOA "roadmaps" that promise to articulate SOA's role in improving select, typical business processes.

Finally, SOA more or less requires organizational and cultural change in user enterprises to truly be successful. An enterprise services-based environment requires centralized IT management, sharing of resources (and costs), and sophisticated services-oriented resource/asset management capabilities that few user organizations today possess. As noted in Saugatuck's previously noted SOA Research Report, "unless users are willing to take on the serious challenges of implementing SOA as a wholesale change in the way business units work together and develop systems, the real benefits of SOA are unlikely to be realized."

Market Impact: Over time, SOA can and will yield significant business benefits to both users and vendors. At the IBM Impact event this week, a Toyota Motor Sales executive detailed how the company was able to utilize an SOA architecture, web services and an Enterprise Service Bus (ESB) to reduce the time required to link buyer-specific data with vehicle-specific data (i.e., owners and their new cars) from four days to about four hours, improving customer satisfaction by enabling faster and more accurate responses to new owner inquiries. The implementation also helped to reduce or eliminate redundant data sets, operations, and server requirements, and reduced risk and overall costs by reducing operation complexity and management needs.

But what can vendors do to kick-start SOA into the next wave of adoption?

Put bluntly, there are a lot of less-expensive alternatives to SOA that deliver very similar business benefits. Better articulation by vendors of the competitive, strategic business advantages of SOA -- not just IT and business improvements, but real, industry-specific competitive advantages, presented in short-and long-term financial case-study format -- will help user executives better understand the value of SOA investment.

Continued growth in user enterprise IT spending will also help, in two ways. First, more money is available for IT than in recent years. Saugatuck has previously shown how IT investment spending is back to pre-2001 levels (see Saugatuck Roundtable: How will IT Spending Fare in 2006 vs. Overall Capital Spending and other Competing Priorities for Corporate Cash?, EVT-230, 09Mar06). More recent research shows that four of the top five IT spending priorities for 2007 -- business intelligence, data warehousing, new custom applications, and portal/collaboration applications -- are prime SOA candidates (see IT Insights & Trends: Spending to focus on Integration, Efficiency and Effectiveness through 2007, RA-307, 10Jan07).  And we recently published C-level user executive research indicating that user executive focus on short-term ROI is waning, replaced by demand for investment plans that drive business growth (see previously highlighted C-Team study). SOA is a clear complement for all such environments.

But the growth in IT spending will also drive increases in IT complexity. The more complex the IT environment gets, the more user IT executives will be able to justify investment in high-cost, high-value technologies and approaches such as SOA that simplify IT management AND improve business operations.

Mostly, an acceleration of SOA adoption will take time. SOA is a simple concept with exceptionally complex requirements and implications.