"It's completely eradicated the old way of doing things," Bapatla says. In addition, business-process monitoring software from CommerceQuest Inc. audits each business process along the way to spot any disruptions. A real-time message audit eliminates the prospect that a failed trade will lose revenue for a client by missing the deadline. Services-oriented architecture "is so key," Bapatla says.
It's no coincidence that services-oriented architectures are maturing at the same time that businesses are doing other housekeeping. Because they encompass auditable business-process management, services-oriented architectures can help companies achieve compliance with Sarbanes-Oxley, the Health Insurance Portability and Accountability Act, and other regulatory requirements. Analyst Stephen O'Grady with IT research firm RedMonk refers to the idea as a "compliance-oriented architecture." For example, electronic-record retention could be manifest as a software service that's reused whenever saving records is a requirement, O'Grady writes in a recent report.
Despite the fact that they bring a greater degree of order to IT environments, services-oriented architectures have to be managed and maintained (see story, Scalable: Managing Web Services Demands New Approach). They also create new security risks: Since Internet-accessible software components are fundamental to services-oriented architectures, any oversight could expose systems to outside threats. To avoid that, software architects are using the HTTPS protocol, which encrypts messages and documents being sent over HTTP, the new Web Services Security standard, and IP filtering.
To secure a 6-month-old architecture that opens its systems to business partners, Aeroplan is using an appliance from Reactivity Inc. that parses XML messages, making sure they come from known trading partners and contain no hidden instructions. Aeroplan is the frequent-flier program administrator for Air Canada, its parent company, and a loyalty program supplier to American Express and the Canadian Imperial Bank of Commerce, a Visa card issuer. Its rewards programs let credit-card users accumulate miles for purchases made with their cards, then redeem them for freebies such as hotel stays or car rentals.
Aeroplan developed a services-oriented architecture because, although it tracked frequent-flier miles and accounted for their redemption in its internal systems, "we needed to externalize those same services to our part- ners," such as hotels offering rewards, says Spyros Kattou, E-business architect. Also, Aeroplan made it easier for consumers to redeem miles on its Web site, skipping the need to apply for a certificate sent in the mail. The change has led to "a very important increase in reward redemption," Kattou says.
There's a compelling business case behind Aeroplan's services-oriented architecture: The company can't recognize the transactions as revenue until the rewards are redeemed. "We earn revenue from the burn rate of those miles," Kattou says.
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