Now that the world is coming in terms of deploying Service Oriented Architecture (SOA) as a strategic solution for better gains in the business and agility, the question comes on how to measure the benefits.
Probably you first need to be clear on what you wanted and how you wanted to measure that paramater(s) and then verify where you were before adopting SOA. After every milestone and complete adoption, keep measuring to understand whether you were in right direction.
There are various ways on measuring depending on what were your objectives. Major objectives could be cost savings or improvement in revenue and your agility. While the cost savings are easy to measure, the amount of agility achieved is a bit intangible but can still have a correlation with some measures.
There are two ways to measure the ROI .
1. Effort Redution
You have the estimates for the work that you have been doing. Now after implementing SOA based solution verify the improvements based on amount of efforts reduced in the areas of work sheet.
Major dimensions identified are as follows:
Reuse: The focus of Service oriented architecture is on reusing wherever possible. You can compute the cost savings through tracking the number of service reuses and the amount of cost saving.
The cost saving could be
* Saving in Cost of development of service
* Saving in Rework (the services are already tested and proven and hence the defects will be less)
* Saving in documentation efforts (Designs and deployment documents already in place and may need only minor updates)
Savings in Integration: The integration through SOA Approach is more quick and efficient as well as less error prone and maintainable, compared to the point to point integrations. You can objectively measure the savings in integration in terms of
* Reduction in Number of Interfaces required without SOA and
* Reduction of effort in rebuilding each Interface corresponding cost savings
* Reduction in testing and reworking on each of Interfaces
* Reduction in Interface Maintenance Costs
* Reduction in Documentation efforts
The savings will increase as you have more and more applications involved in the integration using SOA.
Cost Savings from SOA monitoring and management: With SOA Management functions of your techstack, you can manage the common software problems without much human intervention across the network, with alert mechanisms when exceptions occur.
* Cost savings from reduction of Skilled resources
* Cost savings from quick alerts and resolution of exceptions
Hardware Savings: It is best practice for any Project Manager to take the details of existing Hardware used by the customers before adopting to SOA solutions to assess the hardware savings through consolidation and creation of framework with lot of common services and components.
- Cost of Hardware reduction and maintenance
- Intangible benefits of being more ECO friendly by consuming less Hardware utilities
2. Revenue Improvement
The Combination of Process Orchestration and real time business intelligence with robust process management capabilities, the business will get improvements in revenue side apart from the cost reductions.
Depending on the business that you do, you can compute the improvements in some of your Key performance indicators to identify the benefits from SOA.
For example, the real time intelligence coupled with intelligent actions for correction and address the alerts, can provide some of the following benefits:
1. Improvement in Delivery performance
Example: Your Production shop completed the Turbine but the delivery team didnt release the item to customer. An alert from Real time business intelligence tool can make sure the item is delivered on time and reduce your storage costs and on time delivery performance.
- Collect the data and calculate the improvement in delivery performance.
- Also calculate the savings in storage costs which improve the profitability
- Collect ths stock outs per month and calculate the improvement.(Stockouts are reduced due to real time alerts for correction)
2. Improved Inventory turns due to direct integration between businesses
3. Quick and error free mergers and integrations save lot of down time costs and provide you the revenue opportunities due to quick entry of merged versions in to market
4. Improved Customer satisfaction index and expantion of customers
- Count the new customers in each period
- Compute santisfaction index
You can quantify the benefits in the same way in all functions of business such as HR, Design, Order capture and management, customer care, Sales, Finance, Marketing etc.
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