Over and above the need for manufacturers to synchronize these disparate, legacy and often non-integrated systems with ERP, supply chain, distributed order management, and often, global CRM systems is the more fundamental challenge of turning all these systems into competitive advantages in the marketplace. The key business drivers in manufacturing leading to greater adoption of SOA as a competitive strategy in conjunction with ESB architectures include the following. First, there is the exponential rise in mergers and acquisitions across many of sectors of global manufacturing.
The heightened levels of mergers and acquisitions has in turn lead to the development of distributed governance models, and specifically for those companies operating in the U. Indian outsourcing companies including Infosys, HCL, and others claim that during their fiscal financial year, one of our every three dollars earned was the direct result of compliance spending by global manufacturers who had significant presence in the U.
Clearly the business drivers that are enabling the growth of ESB adoption, development, and use also favor the adoption of BPEL-based workflows in response to the demanding compliance requirements for manufacturers who choose to participate in U.
SOX, for many global manufacturers participating in U. The logic of many global manufacturers is that while they are incurring the costs of attaining compliance to government regulations and standards for financial disclosure, they can at the same time completely re-define their it strategies to better align with the needs of their business.
In this regard many manufacturers today look to compliance as the impetus for change, and the primary reason to re-architecting how information technologies and services support making their organizations more agile and flexible.
As Abrahams mentions, compliance is also the impetus for overcoming swivel-chair integration, which has continually plagued companies who have not specifically addressed their manual integration challenges yet.
Many manufacturers are in this category. The key it drivers that are supporting the growth of ESBs throughout manufacturing include the need for route requests more efficiently throughout the many ERP, order management, supply chain, logistics, CRM, and service applications that manufacturers in many cases have allowed to become too decentralized and siloed in performance.
This key it driver of ESB adoption has to do with the integration of multiple ESBs located throughout a global manufacturing enterprise. XML-based messaging and schema also contribute to the real-time integration between ESB hubs, allowing for multiple state engines specific to the dominant processes in each location to be synchronized and also predicted in their overall performance.
One critical measure of this overall level of synchronization of systems is the attainment of the Perfect Order, a key performance indicator manufacturers who have mass customization strategies rely on for measuring performance gains in processes over time. Additional drivers from the architectural standpoint for ESB adoption and growth in manufacturing include resolution in many manufacturers as to if they should electronically enable their direct and indirect channels for real-time integration, and if so, which business models are most amendable to the change.
From an it perspective, the development of real-time integration connections throughout either an indirect or direct channel is challenging, costly, and very time-consuming.
The flipside of the argument in must manufacturers today however is that it is a critical competitive advantage and sets the stage for deploying more Web Services-based applications outside the firewall into the broader indirect channels.
Table 1 provides a comparison of the strategies manufacturers are using to accomplish real-time integration throughout their channels, and also defines those tasks by channel strategy that manufacturers today are leaving in batch mode relative to enabling through ESB architectures to become more private trading exchange-like in their ability to quickly sense and respond to market demands.
In those areas of real-time integration, manufacturers mentioned previously are piloting Web Services and relying on BPEL-based workflows to create greater efficiencies and a strong focus on measuring business benefits as a result. There are the exacerbating factors of ensuring order state engines across ESBs can function correctly and can communicate reliably when any channel-based strategies is considered in the context of SOA.
Many manufacturers are using XML-based linking to provide real-time analytics visibility throughout their demand channels, ensuring that forecasts arriving at manufacturing centers in fact can be build specifically to the requirements of the businesses ordering them. These scenarios as they relate to real-time vs. Planning Web Services for Channels: Direct Sales Model Sales force calls directly on customers; High margin and high ticket products and services sold directly to customers; cost per sale is high; response time on sales cycles is high; price elasticity of products is low.
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