IBM SOA EXECUTIVE SUMMIT Sydney 17 July 2007

IBM SOA EXECUTIVE SUMMIT Sydney, 17 July 2007

IBM SOA Business Process Management Enabled by SOA Deon Newman Director, SOA Marketing ©

IBM SOA CEO’s Cite Innovation as Top Priority for Business Model Innovation delivers the greatest returns Results of 765 CEO interviews worldwide: Out Performers place 2 X emphasis on Business Model innovation than under performers - CEOs are under intense pressure to innovate - Corporate culture is critical to sustained innovation - Business model innovation is the new strategic differentiator Source: IBM 2006 Global CEO Study 3

IBM SOA Which key business priorities will your IT organization implement or support in 2007? Note: Multiple responses allowed. Data: Information. Week Research Outlook 2007 study of 300 business technology professionals 4

IBM SOA Inflexible and Outdated Processes Are the Root Cause of Many Corporate Disasters Major Airline strands passengers on runway for 10 hours – no food, overflowing toilets Market-leading cell-phone provider exits market after small fire Why? Inability to modify processes on the fly. 5

IBM SOA Business Process Management is a Discipline… BPM Solves: Processes aren’t documented Bottlenecks prevent efficiency Complex integration across multiple processes Limited visibility into performance Process change is cumbersome KPIs not defined BPM Includes: Integration Modeling Monitoring Software that Enables BPM Forms Rules Engine Workflow Models Process Knowledge Metrics Expertise that Delivers BPM Policies Business Logic Methodology BPM governs organizational and operational activities 6

IBM SOA Optimizing the business is the ultimate goal lower higher BPM adoption maturity Process optimization Transformation Business insight Value to shareholders and competitiveness Process monitoring Compliance & consistency IT agility higher Process execution SOA Efficiency Knowledge lower Process modeling Workers, supervisors and managers CIO Customers and partners CFO CXO CEO Stakeholders 7 Entire contents © 2007 Forrester Research, Inc. All rights reserved.

IBM SOA BPM Starts and Ends with Business Value § Track metrics to measure process performance § Harvest data to optimize process performance § Achieve insight and receive alerts to small problems before they become big ones § Deploy on a SOA platform § Automate processes improve profitability § Facilitate human interaction to increase work efficiency and reduce errors Define § Align business strategy and execution § Communicate effectively between business and IT § Collaborate to improve business process design § Leverage industry standards and frameworks Understand Collaboration Execute § Assess, capture, and analyze core behavior § Understand value processes § Identify redundant, duplicated, and inefficient processes Process Governance 8 Business Strategy Optimize

IBM SOA BPM and SOA – Better Together “…SOA and BPM initiatives…are more successful and the benefits are compounded when they are united” “Organizations that align their BPM and SOA initiatives in 2007 will double their likelihood of becoming an industry leader by 2011” Source: BPM and SOA, Better Together, Paolo Malinverno, Janelle B. Hill, Gartner, Feb 2007. 9

IBM SOA …. and here’s why SOA improves how you design, manage, and optimize your business processes by enabling: SOA at the core of BPM: Business Processes External • Solution Building Efficiency • Reuse of existing assets • Flexibility in change 10 Services (Application & Information) Operational Systems (Application & Information Assets) Application Content Data Registry

IBM SOA IBM & SOA at Wachovia BPM & SOA Drove Business and IT Success 11

IBM SOA Five Flexible Starting Points for BPM Customers can start BPM in different ways Business Process Management Modeling & Simulation Process Automation Rules and Pre-built Frameworks Content Centric Processing Design and simulate business processes 12 Business Activity Monitoring Track performance, gain insight, and take action Choreograph processes across applications and systems Manage process rules and accelerate design and implementation time Manage processes where content is used as input for a decision or produced as the output

IBM SOA Business Level Modeling and Simulation § Use ROI reports to compare and analyze Results § Model “what if” scenarios § Use simulation capabilities to: - Assess risk mitigation - Make investment decisions - Calculate value of improvements § Import Visio Models 13 Web. Sphere Business Modeler Iterative and continuous improvement

IBM SOA IBM Process Modeling & Simulation § 17 Industry-Specific Process Maps and Models based on IBM best practices and the Standards-Based Process Classification Framework § Helps clients kick-start processoptimization engagements. Support for Visio Documentation § Both Modeling tools support leveraging existing Visio documents § Web. Sphere Business Modeler can import Visio drawings § File. Net P 8 Process Designer contains Visio BPMN palette 14

IBM SOA Identify activities and areas for improvement § Driving force behind BPM Adoption BPM Disguised as: Product Lifecycle Management - Synchronize SAP ERP system with various production plant software systems - Manual processes requiring data gathering, was time consuming and error prone (Plant Operations) Supply Chain (Inventory Management) Modeled processes for visibility Aligned business and technology priorities Used adaptors to integrate custom apps with SAP Deployed improved processes on an SOA Rapid Solution Deployment - 4 Months from Concept to Implementation Reduced potential human error with process-controlled automation 15

IBM SOA Business Activity Monitoring Scorecards Key Performance Indicators for business units Collaboration Work with teams to resolve situations Business Alerts Notification of situations that require response Reports & Analyses Understanding trends by combining real-time performance and historical information External Information affecting performance 16 Web. Sphere Business Monitor

IBM SOA Expanded BAM Business Activity Monitoring § Monitoring Third Party Systems § Providing adapters and support for pulling information from a variety of sources. Industry Dashboards § § Templates for industry verticals including key methodologies Predefined, full configurable dashboard templates Human Task Mgmt. § § § 17 BPM Dashboards for human task monitoring and management Monitor human tasks in process BPM Dashboards will provide an optimized experience for those roles responsible for managing the people side of process.

IBM SOA NYS Dept of Taxation and Finance Business Challenge: NY State Dept of Taxation and Finance (NYS DTF) processes 11 million personal and 2 million corporate returns annually using aging technology that can’t keep up with the demands of citizens and users. NYS DTF needs systems and tools that are flexible, permit faster change and reduce overall costs. Solution: Leveraging SOA and BPM, NYS DTF is rapidly transforming their systems, data, people, and business processes to be more functional, flexible and responsive to citizens, users and legislation. Traditional mainframe batch processing is shifting to transactional. Manual processes are transforming to automated business processes. Real-time business activity monitoring is replacing daily printed run reports. Results: Rapid modernization of legacy batch systems to transactional. More channels to enhance voluntary compliance. Web services and XML linkage to IRS for corporate taxes. High component reuse, lowered costs. Reduced errors and business exceptions. Higher value business metrics. Implementation Details: Web. Sphere Business Modeler, Business Monitor, Process Server, Integration Developer, Application Server, Flat File Adapter, Commerce, DB 2 V 9 pure. XML, Data. Stage, Workplace Forms, CICS Transaction Gateway, Rational Suite, Tivoli Composite Application Monitor. 18

IBM SOA Process Choreography and Automation § Runtime for end-to-end SOA-based process automation Transform your business from this… § Flexible, reliable, scaleable, secure § Integrated ESB for Range and Reach § Seamless access to all available services § Robust Human and System-centric BPM Capabilities: § Human to Human; Human to System; System to System BPM for the Mainframe 19 …to this

IBM SOA BPM for the Mainframe Process Automation § § § 20 High powered process engine on a high powered platform New business user client generation in Web. Sphere Integration Developer for processes deployed on z/OS New Adapters for z/OS: e-mail, JDBC, FTP, Flat File, SAP BPM and SOA governance on the Mainframe through Web. Sphere Service Registry and Repository IBM Content Manager with Process Server added content-centric capabilities

IBM SOA Industry Frameworks § Rules and Pre -built Frameworks Service-Oriented Business Solutions Frameworks Based on Industry Standards Combination of IBM and Business Partner Assets § § Industry Content Packs § § Business Service Templates to accelerate deployments Expanded industry coverage for Bank and Telecommunications Web. Sphere Business Services Fabric § § § 21 National Language Support Alignment with IBM SOA Foundation Additional Standard Operation Environments

IBM SOA Content Centric Processing Content Imaging/Capture Doc Mgmt Web Content Mgt. Process Dev Framework Doc Routing Workflow 22 Compliance Records Mgt. Email Mgt. Discovery

IBM SOA Web. Sphere & File. Net Roadmap BPM Enhancements Innovation Investment Protection Integration • Common Service Registry and Repository • Common Modeling, Monitoring Tool • Enhanced run-time integration Interoperability • Web. Sphere & File. Net Processes can invoke each other Q 4 2006 23 3 Q 2007 2008

IBM SOA BPM Enabled by SOA Services § BPM Expertise § § § Enhanced BPM capabilities and services to address any point in the SOA journey Integrated business solutions to accelerate deployment of new business processes Deep industry expertise Consulting methods, tools and reference materials BPM Methodology § § 24 Comprehensive “How-To” reference guide with services Covers both the business and IT sides of BPM Six Sigma, Lean, and other methodologies in combination with BPM software Supports Organizational and Operational Governance

IBM SOA Summary of BPM Announcements Expertise § Enhanced BPM Methodology § GBS Offering: “BPM Enabled by SOA” § Web. Sphere / File. Net BPM Roadmap § File. Net P 8 4. 0 § Standards Based Process Models § Academic Initiative § Expanded BAM § New Industry Dashboards § Industry Content Packs, Industry Frameworks, § Web. Sphere Bus Services Fabric § BPM on Mainframe 25

IBM SOA IBM Expands BPM Value Proposition IBM BPM Enabled by SOA Web. Sphere BPM Systems File. Net BPM People Documents Content Folder § Form § Images, … IBM a Leader! (Forrester IC-BPMS 4 Q 2006) IBM a Leader! (Forrester HC-BPM for Insurance 3 Q 2006) (Forrester ECM Wave 2006 – Document Centric BPMS Wave Pending Q 2 2007) IBM is now the clear market leader in BPM with the most comprehensive set of software capabilities and business expertise 26

IBM SOA IBM has a complete BPMS “IBM is the first and so far the only infrastructure software supplier to offer a complete BPMS supporting the end-to-end lifecycle from analytical modeling to performance management and optimization – based entirely on service oriented architecture. ” Bruce Silver, Bruce Silver Associates – The 2006 BPMS Report 27

IBM SOA IBM Leads in BPM Enabled by SOA § Business Expertise: - BPM Enabled by SOA Readiness Assessment (www. ibm. com/SOA) - 1000+ consultants trained in BPM Methodology and BPM Enabled by SOA Engagement - 20 BPM Training and Education classes available § Technical Leadership - Breadth of Offerings from Tooling to Runtime; From Dashboards to BAM; Modeling, Simulation, Choreography, Frameworks, and ECM - All supported by SOA § Market Recognition: - Leader in Gartner BPA MQ - Leader in Forrester Integration, Human, and Content centric BPM WAVES § Vibrant Ecosystem - 300+ BPM Business Partners – 4000+ pre-builts assets in the SOA Business Catalog 28