'SOA can be put into practice in existing IT environments'

Service Oriented Architecture (SOA) is the new rage. SOA's ability to

transform application into business components makes for highly flexible

solutions architecture, as individual components can be removed and new ones

added. SOA- based IT architecture assumes more significance in the Banking and

Financial Services (BFS) space. In an interview to Shrikanth G of Dataquest, the

company's AVP, Global Head-Product Strategy and Management, Finacle-Sanat

Rao talks about the multi-pronged impact of SOA in the banking space. Excerpts:

Sanat Rao

How significant is SOA for banks in comparison to the

existing IT architectures?



To keep pace with rapidly evolving business and operational requirements

along with changing customer demands, banks need to constantly upgrade its

banking practices and processes. This is only possible if banks regularly

enhance their core systems and associated applications. A service-oriented

architecture (SOA) assumes an island of service identified by functionality and

not by technology. It also includes process definition standards and can

accommodate process changes that would take place during a core banking

implementation. Since SOA is technology-agnostic, not aligned to any specific

technology platform, development language or technology tool, it can seamlessly

be put into practice in existing IT environments. This quality of SOA ensures

that changes in technology and processes during core banking replacement can be

phased out and managed effectively.

With the advent of CORBA, the promise of creating a single

view out of heterogeneous systems, cutting down on development times etc have

been talked about. In these scheme of things where does SOA steps in?



SOA is an integration framework that binds internal and external services to

create a solution. Just as a storage area network provides virtualized storage

that is not dependent upon a specific storage device, and grid computing

provides virtualized processing that is not dependent upon a specific computer,

service-oriented architecture provides virtualized application functionality

that is not dependent upon a specific block of computer code. With SOA, instead

of focusing on different applications that reside on different computers, the

emphasis is on business services that represent several different underlying

applications.

Can you talk about some of the banking application

scenarios that bring to fore the significant benefits of SOA based solutions?



Banks can migrate functionality into a centralized middle tier environment,

thus creating a centralized enterprise components' layer of business logic

sitting in front of the core systems. This allows banks to remove duplication

and leverage synergies across multiple product systems, thus maximizing cost

savings, homogenizing operations, and standardizing sales processes. The

business components in this enterprise layer are product-agnostic (e.g. pricing,

commissions, workflow) and can be readily standardized across product systems

with minimal customization. SOA provides an alternative to the complex and

high-risk 'big bang' replacement strategy by allowing banks to replace

specific areas of functionality.